How to navigate job insecurity and redundancy during economic uncertainty

In the wake of the coronavirus, uncertainty has become the new norm for many people. The reality is that the landscape is changing daily, and job security is in question for many industries. And whilst many people understand that businesses and organisations are looking for options to reduce expenditure and some have to make the difficult decision to downsize their workforce, employees just want help to navigate through these tough times.

The pandemic and consequential economic crisis will see more than a million Australians lose their jobs from a variety of industry sectors over the coming year. In this period, it’s crucial to look ahead and consider options that will benefit the business and protect jobs.

From a management perspective, maintaining empathy and sensitivity towards your employees is key to navigating the uncertainty of the current landscape, and to ensure organisational success and survival.

Retaining staff – People are your greatest asset

Whilst it may be a trite statement, the main asset of any company is its employees. In times of uncertainty it is imperative to look after your staff. While redundancies may be unavoidable for some businesses, and for others there is an understandable temptation to make employees redundant in the present circumstances, other options (most notably JobKeeper) should be fully considered before redundancies are made.

It is important to remember that the current challenges won’t last forever, and once the crisis ends (or at least some of the restrictions are lifted) employers with a significantly diminished workforce will not be in a position to effectively restart business and will be at a competitive disadvantage. Even with more jobseekers on the market (as a result of redundancies and shutdowns during the pandemic), those companies with a reduced labour force will simply not be able to recruit a large number of suitably qualified employees quick enough to restore their pre-crisis capability.

Be transparent

Reduce stress and opportunities for panic by offering support and supplying facts. Given the level of disruption COVID-19 is creating and the uncertain outlook, it’s important to provide clarity to employees about how their roles may change and to set expectations regarding new ways of working. It’s imperative for management to keep employees updated on where the company stands and how jobs may be impacted in the coming weeks and months.

Communicating clearly and concisely even when you don’t have all the answers helps reduce uncertainty in people and builds trust in you as a leader.

Financial relief is available

The Australian government has announced its JobKeeper payment scheme to encourage businesses to retain staff throughout the economic downturn. Under this scheme, eligible businesses will receive $1,500 per fortnight, per employee for up to six months.

Additionally, the government is offering temporary cash flow support, as well as various other support measures, to businesses and not-for-profits across Australia. Taking advantage of these incentives may enable you to retain employees if your organisation has been financially impacted by COVID-19.

Reduce expenditure – without redundancies

While employers will often assume that mass redundancies are their only course of action, other options are available and may actually be more cost-effective. These include:

• Allow employees to take their paid leave
• Reducing work hours for some or all employees
• Reducing wages for a defined period
• Introduce job sharing
• Introducing furlough or sabbatical leave i.e. temporary employee leave under special circumstances
• Moving employees to other areas of the business that need support

Given that these are unprecedented times, employees may be willing to accept alternative working arrangements or even temporary pay cuts in order to keep their jobs. From an organisational perspective, implementing these measures rather than redundancies will allow you to retain your best people and hold steady for when the market turns around.

The COVID-19 crisis will pass. Stay close to your workforce and keep the channels of communication open. to help your organisation be ready once the rebuilding effort gets underway.

For more information please contact one of the Taylor Root Australia team.