Dear employers and employees,

Another month is coming to an end!

For most business owners, these are not the best of times. It is no longer news that many businesses and business owners are groaning under the weight of financial loss occasioned by the lockdown imposed on some states in particular and the effects of the economic strangulation due to COVID-19 in general.

Historically, about mid-month is when most business owners start to worry about how to sort out salaries and other sundry experiences (pay suppliers, pay bills and other stuff). This timetable is true for most SMEs and Single Entity entrepreneurs (ever wondered why your bosses put pressure and ‘tension’ you around this time of the month on the status of receivables), many of whom will already be contemplating how best to get off the conundrum of paying staff salaries when no work was done for the month. This problem has only one of two solutions for many of these guys – 1. Initiate Layoffs or non-payment of salaries (if this is not already the case even for last month at the onset of the lockdown); and, 2. Slash salaries (again, if this hasn’t been done already) while hoping the lockdown is lifted soon.

Speaking with many of my friends and colleagues, I have come to the realization that it is a catch-22 situation for both the employers and the employees: The employer whose business hasn’t recorded any revenue figures in a month is in a difficult place as to how and/or where the resources to pay staff that hasn’t been working will come from; on the other end of the spectrum are staff who feel entitled to salaries or some sort of compensation from their employers – after all, haven’t they been instrumental to previous years of financial buoyancy for the firm?

It is a really touchy matter and one risks being drawn into a dizzy maze of emotional bias, based on which side you are on – employee or employer. As someone who has been on both sides of the equation, I may be able to better appreciate the arguments from both sides of the divide – and believe me, there are really strong arguments.

But, having said all of the above how does one justify an employee who refused to pay members of staff at the end of March, when in full knowledge a lockdown was coming into effect? An employer who put staff on leave, lays off staff or furloughs staff (i.e. place on temporary sack) without pay?  Or the ones who continue to ask their staff to “work from home” without pay for March and no plans to pay even at the end of this month?

In my view, we all have to realize that the shutdown and subsequent impact on business is outside anyone’s control. Hence, the current circumstance is one that calls for a lot of empathy and compassion from both parties.

However, business owners, have a bigger role to play. An employer must look at human resource not as RESOURCES but as HUMANS. – Shanu Afolami – Tweet this

Behind each one are undefinable number of dependents relying on these “bread winners” for daily survival. If we take a moment to consider our people from this angle, maybe then a lot of my ‘employer’ friends might have a better view of how to treat this issue of staff payment in a stagnant economy during a pandemic. This is a powerful emotional argument to be made for the staff.

A more rational argument that can be made in support of the members of staff is, every business with a good sustainable model should be self-sufficient and self-sustaining. This means, over a period of time (even in the short term – and business consultants and professionals usually advocate a 6 -12 months period), a business should be able to continue operations even without a profit. If one carries this argument a little further, if the business has been in operation for a few years with varying levels of financial success (i.e. profits), it will be expected that it would have set aside resources in reserve for the ‘rainy day’ – such as a COVID-19 pandemic …and, in a situation where it has been consistently posting a loss, a “shedding of dead weights” should have been initiated to ensure the overhead isn’t going to be too much of a burden for the firm during the aforementioned 6-12 months period. Thus, a situation where salaries continue to be paid shouldn’t be an issue (again back to the argument, after all, the staff contributed their quota to the period of “bountiful harvest” for the company). A business that doesn’t have this kind of model in place hardly has a moral basis for being in business and taking on staff.

For the employer, and this is where I think many failed and lost the plot, would it not have been a better idea to have a collaborative solution with members of staff on how to navigate the lean period of this lockdown? A general meeting stating the business’s position and requesting practical suggestions from staff members on welfare packages could help in better feeling the pulse of your workforce (their expectations, needs etc.). It should be particularly noted, that as members of staff, the financial situation of the business is not entirely unknown to your staff. They know when you are ripping them off and when things are good – unless you are that type of employer who is very good at running a “closed book” enterprise. Nonetheless, the bigger advantage of bringing in your staff on board and on-side, is that the ball would have been squarely put back in the staff’s court to be emotionally invested in the continued survival of the business.

Since that horse has already bolted from the stables and we are already in the middle of the lockdown, a more rational approach could be to look at how your business can benefit from this situation. Your firm can grow her social capital by showing a more inclusive and compassionate side of its personality. Endeavoring to provide for your staff members’ basic needs (and always remember that this does not always directly have to be money) in a period like this will earn you strong points with how your staff interact with and project your business to others. It builds an emotional bond which can be of immense value to your business down the road as feelings of loyalty, passion, compatibility and desire to contribute to the success of the firm will be higher and more entrenched. If you have a well-cared for and happy staff, you can then begin to initiate certain activities that will build your company’s social capital – you can encourage them (alongside yourself)  to engage in a number of group activities (from their various points of isolation of course e.g. a karaoke challenge which you can then publish on the company’s social media). A happy and well-motivated workforce, with a feeling of being well-cared for will genuinely key-in into a program like this and the value to your business will be way more than the cost of providing for their needs during this lockdown.

Finally, businesses and business owners should understand that their staff are their responsibilities – in so far as they are still carrying employment contracts. Hence, the temptation to throw them to the wilderness to cater for themselves, in a bid to save money should be resisted. Even if the hard decision to let staff go, in order to save the company has to be taken, it should be a decision taken with compassion and a sense of humaneness behind it. Let them go, but let them go in a way that they can say – I was happy working with XYZ Company and hope to come back once this whole lockdown is over.

 

Another exciting post: Keeping A Healthy Mental Balance in a Pandemic

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Written by: Shanu Afolami, Lead Strategist at 3keys Communications Concept

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