We are experiencing critical times. International borders are closing, businesses shut down – it is needless to say both employers and employees are concerned about how the COVID-19 virus will affect their work, their health, and the people around them.
To minimise both the mental distress and economic impact of this pandemic, our HR department is here to support and guide our clients through these tough times. In combination with the financial measures taken by the government, we are hoping to significantly reduce the negative consequences that this pandemic has had, and will have, on your business.
Cutting costs during downturn in work
During financially critical times, business will suffer. In combination with the government’s latest instruction of closing down all commercial businesses apart from essential services, this has entailed a large number of employers who are unable to provide their employees with work as normal.
When employers choose to close the workplace, workers are entitled to payment unless it is stated otherwise in the employment contract. In other words – if you are finding a downturn in business and you decide that you do not want your employees to work/there is no work for them to do and they are not sick – i.e. this is not a case of self-isolation or employees having symptoms – then you will need to pay them their contractual hours. If not, you are in breach of contract.
What are my options?
In case there is no work to do, businesses might have no option but to consider redundancies. On 20 March, Chancellor Rihi Sunak announced a coronavirus job retention scheme – a support package open to all UK businesses in order to protect millions of jobs during the temporary downturn in work caused by COVID-19. The scheme includes grants to cover 80% of worker’s wages limited to £2,500 per month, in the case where they would otherwise be laid off/made redundant. Additional information about the scheme, qualifying criteria and how to apply, is available in our blog post.
Employers who find themselves in a situation where they “only” have to reduce the work hours for employees, thus, there is still work for them to do, they would not qualify for the scheme as it is not a redundancy scenario. The employer will then have to look at other options.
Unpaid time off: As an employer, you may not insist on your employees taking unpaid time off unless it states so in the employment contract, which is fairly unusual. Given the current extraordinary situation, you could consult with your staff. For some employees, a period of unpaid time off might be preferable rather than losing their job completely.
Thus, unpaid time off can be given in consent with the employee. With the new wage package rescue plan (see below), this could be a particularly beneficial solution for employers within the applicable industries.
Negotiate reduced hours: Similarly as negotiating unpaid time off, this will have to be done in consent with the employee(s).
Request annual leave: The general rule is that you may require an employee to take time off as holiday, though you must give a notice twice as long as the actual holiday.
Governmental financial support: There has been announced a number of measures taken by the government to support UK businesses during these critical times, especially put in place for the survival of SMEs and to avoid mass unemployment. We continuously update our blog with the latest announcements from the government, how and when to apply for grants and loan schemes. By securing any of them, reducing staff could be avoided.
Our HR team can advise you in what option is best suitable with your current situation and future aspirations in mind. When needed, we assist in contract reviewal, restructuring of employees and potential negotiations. We will, of course, always base our advise on the latest guidelines from the government and the ACAS and thereby ensuring compliance.
Communication is key!
With the majority of the workforce working from home due to travel restrictions and social distancing measures, communicating with your employees might not come as naturally as when you constantly bump into each other in the office. This time might also be a period of emotional distress and fear amongst employees, which makes continuous communication even more important.
Frequently checking in on your employees and informing them about expectations and precautions taken in terms of COVID-19 can be reassuring and affect employee’s mental health positively. Further, it is important to pay additional attention and take extra steps for those employees belonging to a vulnerable group.
Goodwille HR can support your internal communication in connection to COVID-19 – how to communicate with employees, the latest governmental guidelines and provide with templates for employee letters.