The end is nigh – pivoting your people strategy and contingency planing for the end of furlough

The end is nigh – pivoting your people strategy and contingency planing for the end of furlough

With furlough set to end at the end of October, it’s time to take a good hard look at your business, budgets and people plan and ask yourselves these questions: –

Does your pre-Covid People Plan still apply or has your business changed beyond all recognition?

Setting aside budget constraints for the moment, what changes do you need to make to adapt your organisational design model and People Strategy in-line with a change in business model, customer proposition or distribution channel?     Similarly, do your team have the right skills and behaviours to drive profitable growth in the new world order?

Even if you think that nothing has changed, there are very few businesses that haven’t had to pivot or adapt to some extent.  Therefore, it’s always a good idea to take stock and a blank piece of paper and consider whether, if you were starting your business from scratch today, what your optimum organisational design would look like?   See here for my step-by-step practical guide on how to align your organisational design to your strategy and business goals.

Is furlough staving off the inevitable?

It can be tempting to hope that business will pick up by the end of October so that you don’t have to make any redundancies.  However, it’s important to be realistic and plan for these now. Firstly, it means that you can take advantage of the furlough scheme when giving notice (although you will still need to pay notice at 100% of pre-furlough salary).  Secondly, even if you haven’t mentioned redundancies, you can be sure it’s the elephant in the room and your team will be worried about the possibility of redundancies.  This is particularly true if they have line of sight to falling sales figures and lower client demand. (As a side note, see my blog on Why Change Often Fails to find out why it’s vital that your team always know exactly how  the business is performing, why this is the case and the role that they play in achieving the Company’s goals).

It’s much better to be open and transparent and start talking to your team now about the possibility of redundancies.  Be frank, tell them like it is and invite them to put forward ideas and suggestions on how to save operating costs and drive revenue in order to minimise or eliminate the need to make job cuts.

With redundancies never far from anyone’s mind at the moment, I have found that many employees understand the situation and are prepared to offer and consider potential alternatives such as reduced hours or pay cuts in order to try and avoid redundancies. Over my years in practice I’ve also seen some really innovative ideas from employees ranging from business boosting ideas to opportunities to save significant operating costs, all of which have significantly impacted the bottom line.

If you are in the unfortunate position of having to make redundancies, then my redundancy top tips will help you navigate the process.

Have customer/client footfall declined and/or buying patterns changed?

Many of the retail and salon clients that I work with are telling me that there appears to be no rhyme or reason to fluctuating customer footfall and client bookings at the current time. Prior to the pandemic you could almost guarantee that footfall in shops and salons would be higher on, say, Fridays and Saturdays than on Mondays and Tuesdays, but fast forward six months and it appears that you need a crystal ball to predict footfall and client demand and therefore the number of staff  you need working on a particular day/hour.

Is this something that you are experiencing?   If so and your team are on fixed days and hours of work, you may want to consider consulting with them with a view to moving them on to a more flexible working pattern.  By this I don’t mean zero hours but a new ‘hours’ clause which stipulates that the days and hours that they work each week/month will vary in line with the needs of the business.     You may even want to discuss this with them informally first to gain their thoughts and input. Again, the sooner you start discussing this and show you are open to ideas and suggestions and fully committed to considering these, the better.  However, it’s always advisable to get specialist advice and support when varying terms and conditions as you will want to ensure that you take account of the very real and valid reasons why employees do need some fixed days or a longer lead time when it comes to confirming rotas and schedules so that you don’t discriminate against anyone with caring responsibilities.

Short-time working and lay-offs

It’s important to contingency plan in case of future local or national lock downs so that you can manage your staffing costs as effectively as possible.    Therefore, check your employment contracts to ensure you have a clause which covers ‘short-time working and lay-offs’.

What does this mean?

‘Short-time working’ allows you to reserve the right to ask people to reduce their hours of work temporarily if there is an economic downturn or lockdown and to pay them only for the hours that they work rather than their usual contractual hours.

‘Temporary lay-off’ is, in essence, the same as furlough but without Government furlough pay.   Instead, if you have a clause which allows a temporary lay-off you are obliged to pay a statutory nominal payment ( as of 4th September £30 per day) for 5 days in any 3-month period up to a maximum of £150 per employee and pro-rated for part-time employees.

If you don’t have these clauses in place, in the event of any future lockdown or sudden economic downturn, you will have to consult with your employees to reduce hours and pay/ temporarily lay them off and gain their agreement to this.  The alternative if they don’t agree, may be redundancy; dismissal on the grounds of ‘some other substantial reason’ and immediate re-engagement or, to keep them on full pay regardless of how many hours they work or whether they work at all.

If short-time or temporary lay-offs extend beyond a reasonable period a redundancy situation may be triggered so this clause is a short-term fix to get you over a hump rather than a long-term solution and you should take specialist advice if this is something that you are considering.

Covid-19 policies and procedures

Have you formulated a policy on what happens if an employee goes on holiday and has to quarantine on their return?  Will you allow them to take this as paid holiday, unpaid holiday or work from home?  What about the various scenarios? E.g., what happens if someone goes on holiday despite knowing that there is a self-quarantine restriction in place versus someone that goes on holiday and quarantine is announced only after they have arrived in the country?  Whatever you decide it’s important to clearly communicate this so that everyone knows what will happen in each different scenario.

You may also want to reinforce the need to comply with all Government guidelines and any adjustments that have been put in place following a workplace risk assessment.  Importantly, you  won’t just want to explain what they need to do, you’ll also want to let them know how to comply with these and, what happens if they breach the policy and procedure.

Employee Engagement and well-being

It’s fair to say that Covid-19 has taken its toll on people’s mental and emotional health and sadly, in many instances, their physical and financial health too.

We also know that in the wake of lockdown, employee engagement has never been more so important.  Mercer’s Thinking/dealing with the impact of Covid-19 – the employee experience and what needs to change post Covid 19 talks about the need for employers to match “high-tech with high touch” in line with the shift from the office to home working as well as treating employees as “investors” who “invest their time, energy and learning in your business”.

Whether your employees are returning to the workplace, or you have made the shift to homeworking, it’s essential that you support your business strategy with a robust employee engagement and well-being strategy designed specifically to meet their needs and the needs of your organisation.   My  article on  Work place well being – physical, emotional and cultural  explains why well-being isn’t just about free fruit or lunchtime yoga sessions and why it’s essential for your competitive advantage as well as your bottom line.

What other concerns do you have about your People Strategy and leading your team through ambiguity and uncertainty to navigate the new normal?

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