Facebook Live Event 5: Latest Government Updates, Business Closures

Published March 31, 2020 Views: 4

25/03/20

Ed discusses the latest updates from Scott Morrison’s broadcast last night. He also answers questions about stand downs vs redundancy, leave for your employees, business closures, and what to do in the event of a lockdown.

To help your business navigate the COVID-19 crisis Employsure’s founder and Managing Director Ed Mallett is hosting live events on Facebook, to discuss the latest events, burning questions Employsure’s clients are asking and to offer business and management tips. At the end of every session, Ed will answer a few questions that come through the comment section.

Facebook Live Event 5: Latest Government Updates, Business Closures

  • Transcript

    Ed: Hi, guys. Ed here for our daily midday catch up. Lot going on, a lot going on both in Australia and New Zealand. There’s actually a live press conference going on right now with Scott Morrison. We were just pausing quickly to listen to it in case there are any key updates that we needed to pass on to you. It doesn’t appear so. And I’ll come back to the updates from last night in a moment. I just wanted to start by asking you all the questions. I think it’s really important and indeed incumbent upon us as leaders, business owners, managers in this time to do exactly that and lead. And I was thinking yesterday and I was sort of reframing this situation, which, as we know, is pretty terrible as an understatement. But it’s something that we’ve got to work through and lead through.

    And I thought to myself this when I was reframing it in my mind, what would happen if I sat down and said, okay, day one of establishing Employsure, the fears, the thoughts, the concerns I had on that day about not getting a shred of business, pouring my life savings into business at that time, and not knowing whether it was gonna work at all. Those fears versus the fears and concerns I feel today about what’s gonna happen to this business and myself, which would I choose? I would choose the problem that I face today every day. That fear, that concern has nothing, frankly, on the first day that we set up as business owners. And I just thought that might be quite a useful way of reframing the problem for you guys. As you, like me, I’m sure, oscillate in and out of feeling positive, despairing, being concerned.

    But just reminding yourself that you’ve been through this before when you set up your businesses, that fear and concern that you had on day one, really, is far more than you should be feeling today. This is time to lead. This is time to step up. This is time for you to manage through this crisis. The second point I wanted to make on that, I was thinking about the concept of a spring, a metal spring, that is. And I was thinking about that in the context of our obligations as leaders and managers to get ready for the bounce back here. I’m not gonna talk about that today. There’s too much other stuff to talk about today. We will come on to that in due course, what we’re calling stage three, looking at opportunities that are available for businesses going forward. But we’re not there yet.

    But I do want you to bear it in mind. And we’re bearing in mind here in this way, that our strategy for dealing with this, which I’ve described before, is that we are preparing for the worst, but, and I stress the but, hoping for the best. If our strategy was just to prepare for the worst, that would be a highly negative strategy. It would be thinking only about the catastrophe that could be coming up. Instead of making sure that we are placed well to spring back, reminding myself again of that spring, gotta make sure that we, as managers, leaders, business owners, are considering that spring back event.

    So, again, just a couple of tidbits. I’m not a management guru. Those are just things I’m thinking about here in terms of my responsibilities as a leader. How do I ensure that as a business, we are ready to spring back when it comes time to do that? And I’d urge you guys to be thinking along those lines rather than just looking straight in front of your face at the moment, at the problems that we’re all facing and what you need to do about those. That, as we’ve said before, is worrying, not thinking. It’s not following that mantra that I’m following and maybe you guys are now as well, which is T-CUP. Make sure you’re thinking clearly under pressure.

    So those are a couple of bits of information for me, I suppose, things from my desk as to what I’m trying to do here in terms of my responsibilities as a leader. Now just to catch up on last night’s position both in Australia and in New Zealand. I’ll mention New Zealand quickly because it’s quite interesting that they have gone from nought to 60 at a space that’s being quite…at a pace, sorry, that’s been quite bewildering. As a business owner over there, we have a team over in New Zealand and we were well lit on Monday, to be honest. As of Sunday there was a belief that New Zealand was probably a week behind Australia in the strategy it was using to approach coronavirus. And then, as of Monday, they went into planning a complete lockdown, which will occur tonight at midnight.

    So we’ve had to make some very quick changes in plans over there to ensure that we’re ready to operate. As of today, actually, we’re operating completely from home. We don’t have anyone in our offices, anyone out in the field anymore. We’re operating purely by video conference and by phone. So that was a very quick change in strategy and it’s caused a lot of confusion where there has been some really good communication in New Zealand that seems to go backwards, unfortunately, on Monday. And that a lot of businesses are just simply unclear as to what they’re meant to be doing. The position, as we are taking, is this, is that businesses are permitted to operate in New Zealand in one of two circumstances.

    You are on the list of essential services that is being published by the New Zealand government on the COVID-19 website. That’s a far more extensive list than had previously been thought in New Zealand in terms of what various bits of legislation set was an essential service. They’ve gone well beyond that. So have a look carefully at that. Seek advice as to whether you might fall into those essential services. There’s lots of gray in there. It’s arguable, for example, that Employsure could be considered an essential service in those circumstances. We’re not gonna seek to make that argument. We’re gonna work from home instead because that’s the second exception.

    If you’re not an essential services business, you can still work from home. The New Zealand government hasn’t been clear on that. They said that all businesses that are not essential must shut down. And that could be easily misinterpreted by business owners as a requirement to stop running their businesses, which isn’t the case. Carry on working if you can work from home, even if you’re a non-essential business. Over to Australia. A slightly different pace and view on the way things are going here. I was half expecting, as I suspect many of you were, a rapid approach to a broad natured shutdown from Scott Morrison last night. He did go further than he had done on Sunday. That hasn’t gone as far as many of the governments are now going, including New Zealand and the UK.

    What he has done is he’s added to that list of businesses that we looked at on Sunday and I’ll go through the additional new businesses now because there’s lots of gray in there. There’s lots of confusion. And I know from the questions that we’ve been fielding in here that there are lots of different types of businesses that raise awkward questions under what is very scant information, frankly, at the moment, that’s covered the nature of the information at stage. Things are moving so quickly, and I’ll hopefully be able to help you with a few questions answered on that today.

    One of the other interesting things that came out last night was that Scott Morrison, unlike in New Zealand, has used a very broad definition of essential services. So there’d been lots of questions on here about are we an essential service, which was until last night a bit of a red herring in Australia. The states had confused the issue by raising the question of essential services. Scott Morrison then didn’t talk about essential services on Sunday last night. What he said was, everyone that has a job is an essential service at the moment. And in essence what he was saying is, if you need to leave home to work, that is still possible. So he was not saying that you are bound at home and cannot go out to work if you need to do that. And the need, if you like, we are interpreting as whether it is reasonably practicable for you to work at home. If it’s not reasonably practicable for you to do your job at home, then you can carry on going into the workplace.

    So you can see, I know this comes in at midnight tonight, but you’ll see me here in my office today and I’ll be here tomorrow as well. And the reason is it’s not reasonably practicable to do the job that I am required to do at the moment from home. Most of my staff are now at home, but I still have a number of people, actually a growing number of people here that I need to lead through this to ensure that we are helping our clients through this process. And Scott Morrison, in our view, confirmed last night that that was an acceptable way to work. We also have a high volume of field staff out on the road today around different parts of Australia and we consider it subject to social distancing principles, acceptable for them to carry on their jobs, going out and seeing businesses that want to see them because it’s not reasonably practicable for them to do that by phone or video.

    We’re out there trying to help businesses with their workplace relations issues and we see it as necessary to go out and meet with those businesses to do that, subject to social distancing principles. So, hopefully, a bit of clarification on that. Now let’s have a look at some of those industries that were said in the press conference last night, kicking in at midnight tonight and now set to be shut down. Quite a bit of confusion, arguably quite a lot of inconsistency that will be causing problems for a lot of you going through this now. Please do fire through with your questions as ever. We’ll work through some of those at the end, and then we’ll reply to you during the day as that goes on.

    Forward going to the list of questions, I can just see one question saying, can we delay the PM address? We did consider that. We listened to the PM’s address, but it didn’t seem frankly like he was saying much new. And he doesn’t seem to have said anything that changes the position from last night. I’m not really sure why he chucked in an additional midday address. That said, I’m not gonna criticize him for doing more communication than he has been doing today. So the list, all the businesses that came out on Sunday are still on there. Next, there is amusement parks and arcades, food courts. The reason being there is that people were treating a food court as a takeaway station then taking it and sitting down on the communal tables and so forth. In essence, it was still operating as a restaurant. And consequently, they’ve plugged that hole that they noticed over the last couple of days. You can do outdoor activities including running businesses that are outdoors but only up to 10 people and subject to social distancing rules. That caused a bit of controversy last night that came up in the questions to Scott Morrison afterwards.

    And you can see why when you look at the next one that he said that you cannot have weddings with more than the participants, the celebrant and witnesses, which by my fairly back of an envelope mathematics takes it to five people. And that being the case, you’ve gotta have a smaller wedding than a group exercise session, which doesn’t seem particularly consistent, seems a bit unfair on those that run businesses in the business of weddings. Particularly when you go to the next one as well, which is that funerals are allowed 10 people. So whilst I wouldn’t suggest that that number is taken down in the awful circumstances of a funeral, it does seem oddly inconsistent that you can have a wedding only with 5, but a funeral with 10. And you must be scratching your head today as to how that impacts your business, why it impacts your business in that way. You may be feeling as though you’re being unfairly treated and so forth. We’ll talk about those things in a moment.

    Auction houses are going to be shut down, avoiding these congregations of big people, and that includes auctions for a real estate as well, including open houses. That’s quite a big change in a very worrying market for housing markets in any event to suddenly say that they can’t be sold now by live auction and you can’t have open houses is a big, big change for a number of our real estate clients. Play centers and galleries are being closed, perhaps not greatly surprising, many will have done anyway. Swimming pools now closed. So whilst you can have outdoor exercise of up to 10 people, you’re not allowed swimming pools for some reason, which, again, causes a bit of confusion.

    Then perhaps the most confusing of the lot is I’ve seen a number of health and beauty clients getting in touch. And beauty has been closed down. Hair has not. As long as you have a social distancing rules and you’re only allowed hairdressing services up to 30 minutes. And then on top of that, there seems to be a medical type exclusion for certain health and beauty services. So, for example, massage, if it’s got physio benefits, it’s unclear as to whether the litmus test on that is whether you can claim it back, for example, through your health fund. There are plenty of massage businesses that you can claim through your health fund that aren’t physiotherapy businesses.

    So there’s gonna be some confusion about that. And those are all questions I’ll try to answer as we go through this now. I can see some of those questions coming through. Stu, should we turn to a couple of those and see what’s going on?

    Stu: Absolutely. Some of these might be a slight repetition from the last few days, but nothing wrong with that. Any clarity around schools?

    Ed: Just pausing for a moment, just having a bit of a camera issue here.

    Kate: Did you just pause it?

    It just came up and said a camera issue.

    Kate: Camera issue.

    Apologies. Bear with us, guys.

    Kate: That’s pretty much… Should we end it and restart? We have to end it and restart it. Oh, is it working? Still working, yeah.

    Ed: Still seems to be working. Give us a shout if the camera’s not working. It’s saying at my end that it’s not, but let’s answer some of those questions. Probably fed up with seeing my face anyway, so the noise might be a welcome relief. So Stu, any questions from you?

    Stu: Yeah. Just to reiterate, questions coming through over the last 24 hours about clarity around schools.

    Ed: Schools, good question. I’ll interrelate this to the question of carer’s leave, which is a very important one. So schools are taking different positions in different states. At the moment the federal government is saying the health advice that they are receiving, schools remain open. As of yesterday, ACT shut their schools, Victoria went on early holiday. Other schools are recommending that you don’t…in other states, sorry, are recommending that you don’t attend schools. But they are open. New Zealand schools are shut as part of their total lockdown from midnight tonight. I believe many will be shut today as well.

    Now what does that mean? I think that there are a couple of really interesting questions just whilst on New Zealand. New Zealand doesn’t actually have a concept of carer’s leave. So there’s a tricky question there for employers as to what they do with parents that can’t do their work because they’re caring for children during this crisis. In Australia, where you have a situation like you do in New South Wales, given that schools are open but a parent might choose not to let their child attend school and consequently not be able to do their work, that’s arguably not triggering the carer’s leave emergency provision. There isn’t an emergency which causes you to need to be a carer because you could send your child to school. So arguably that doesn’t trigger paid carer’s leave, and your responsibility as an employer is not to pay a carer’s leave.

    You might take the view that you’re gonna be more generous than that and pay in any event. But in those states where schools are open, there is arguably not a trigger for paid carer’s leave at this time.

    Stu: On the back of that, if a parent is required to be at home for the sake of their children and family, what level of proficiency are they expected to achieve in their job?

    Ed: Good question. The rule of thumb that we’re using on that is, can the employee reasonably complete their duties? So they may have a child who is at high school age and is perfectly capable of looking after themselves during the day as long as there’s some adult supervision in the house, right through to babies and toddlers who you’re gonna struggle to do your duties in general with them in the house. But we recommend that that being a conversation, an adult conversation between employees and their employer as saying, “Can I realistically complete my duties or some of them? Is my employer happy with that? Or, am I compromised completely by the need to provide caring to my child and therefore unable to realistically complete my duties?”

    Stu: There’s a few questions coming through. Can we just have a clarity around stand down versus redundancy just very quickly again?

    Ed: Stand down and redundancy. So those businesses I’ve just been through as of midnight tonight, our position is that anyone falling into those categories now opens up the position in Australia to undertake a fair work stand down. I can’t stress this enough, guys. There’s a real confusion around this. Stand down is not a broad natured procedure whereby you can simply…because you’ve had a turndown in business, you can’t simply stand people down under the Fair Work Act. It’s only available in limited circumstances where there has been a stoppage of work for which you, as an employer, as a business owner, cannot be reasonably responsible.

    So we’re saying, if you were one of the businesses that is now subject to a shutdown or will be at midnight, stand down opens up to you as a possible procedure. If not, don’t do it, guys. Don’t lead yourself down that path. There are other options. Negotiating unpaid leave, for example, looking at shorter hours, looking at negotiating pay. There’s an interesting thing that happened yesterday in the Fair Work Commission in that the Australian Hotels Association has negotiated with the relevant union to change their award on a temporary basis. So that things like the minimum amount of hours that you give to a full-time worker have been reduced so that they’re not quite so hand tied in what they need to do under their award.

    You can obviously see that hotels and hospitality are getting absolutely hammered out there with the shutdowns. And a lot of their staff, particularly with casual staff, are the ones that are bearing the brunt of losing their work at the moment.

    Stu: Related, I guess, this one, if a workplace transitions to takeaway-only, that is a cafe, etc., does that affect the award of the remaining staff member and their pay?

    Ed: Could you say that again, Stu?

    Stu: Yeah. If a workplace, a café, etc., goes to takeaway-only and the remaining staff members are serving those takeaways, does that affect their award?

    Ed: It does potentially affect their classification. There were moments of this last night for Scott Morrison where he’s sort of seen saying, “We’re on a different footing here. We’re gonna take pragmatic views here. We’re not looking to trip people up.” And that may well be the position that the Fair Work Commission took or would take or the ombudsman would take if they were investigating things like underpayments of wages. But we don’t know yet. We don’t know what the regulators are gonna do in this environment at all yet. They haven’t communicated that. So be very careful if you are changing someone’s duties, it may well change their award classification and consequently change their pay. If you’re asking them to be adaptable and do more at this time, it may be that they’re taking on greater responsibilities and you actually end up having to pay them more. So be very careful on that.

    Stu: If we do have to let go of some of our staff, are we obligated to help with resumes and/or references?

    Ed: The standard position on references. So it’s up to the staff members to do their own resumes. And obviously they need to take an honest position in those. In terms of references, the standard position tends to be just to provide a statement of service to avoid any potential hazards for employers in giving an opinion on someone. Let’s say that you didn’t actually have that favorable opinion of someone and you gave that and they were unable there to get another job, that they could come back and criticize you for that, potential liabilities that flow from that. Equally, if you gave someone a glowing reference because you thought you just wanted to do them a favor in a difficult job market and their next employer came back and said, “Well, that wasn’t true at all.” There are issues that flow from giving references, good or bad. And the general recommendation is to give a statement of service, which is simply defining the dates that the person worked for you and the role in which they worked in.

    Stu: If a casual worker is actually working full-time hours, does that classify them as a full-time worker?

    Ed: Not necessarily. It’s not simply the hours that they’re working. It’s the regularity and consistency of those. So the issue with hours for casual worker is whether they’re regular and systematic is the language used. So if you’re finding that they have been doing that on repeat for a period, they can start to turn into essentially a full-time or part-time worker, a permanent worker and start accruing rights in that respect.

    Stu: A specific Employsure question, do we get an Employsure discount for months of downtime?

    Ed: Really good question. So I just agreed yesterday with our local board a three-stage process that we’re applying to our clients that are in need. They all start with this principle. We wanna help people at the moment. That’s what we’re all about. We want to make sure that businesses at this time aren’t cutting down on costs and almost cutting off their nose to spite their face and leaving them exposed for when we do spring back. Let’s say, for example, you experienced a fair work claim at that time, but you didn’t have any protection or cover in place at that point. That could be catastrophic on top of the downturn that we’re experiencing. So we wanna be here to protect you. So we’re saying three things for clients.

    The first thing is that if you’re struggling to pay for our services, we will reduce the cost for six months to what we’re calling app cost. We will take all of our profit margin out of it and just pay a reduced amount for access to our advice services and that protection. Second to that, if you can’t afford to pay at all, we’re giving payment holidays of up to three months. And then, as a final stage, I suppose if you’re saying that you need more than that, that’s not enough, then we’re setting up a hardship fund for our clients whereby clients will be considered under a procedure to understand exactly what we can do for them as part of that hardship fund, with the under underlying principle, or sorry, I should say overarching principle that we carry on helping you. We don’t wanna ditch you right now just because you can’t pay your bill. We want to make sure we’re helping through this.

    Stu: Just another question regarding hairdressing. Can you ask a client to wait outside after the first 30 minutes while they have their color on and then come back in for another 30 minutes?

    Ed: A really good question. I just find the whole hairdressing thing mind-boggling, to be honest. It remains mind-boggling. You simply cannot practice social distancing. So my assumption is that having them now had two COAG meetings where they must’ve debated this. They are happy that you can cut hair and be in that physical proximity. They’ve put this bizarre 30-minute ruling. I’m no medical expert, but I’d be amazed if anyone was saying that the 35-minute haircut exposes you more than a 29-minute one does. But that’s the rule. Be practical about this. Do what is reasonably practicable, what they are trying to do, and that’s probably the easiest way to answer this.

    Go back to the purpose, which is to minimize extended periods of close proximity and contact. If you could create space during that period, someone could go away, come back, I don’t see why you can’t do that. You’re being asked to run your business in different circumstances. If you can do it in less than half an hour, great. I’m not, as you can probably tell from my own haircut, an expert on how long it might take to get coloring done and so forth, but I’m sure it’s over half an hour. And looking at that practically and saying, look, are there ways that we can work, with best intent, I suppose, to achieve what’s reasonably practicable?

    Stu: What happens if my employer refuses to let me work from home, even though I can and we then go into a full lockdown? Do I then have to use up all my accrued annual leave?

    Ed: It’s certainly for your employer to determine whether you can work from home. They’re being encouraged, we’re being encouraged to do so if we can. But they’re not obligated to do that. So if we went into a lockdown and the employer was not therefore willing for you to work from home, essentially you would be in a period of enforced lockdown by the government where you wouldn’t be able to carry out your duties and you’d essentially be on a period then of unpaid leave subject to discussing that with your employer.

    Stu: A New Zealand question. Bunnings New Zealand are staying open. We supply them. Can we stay operational?

    Ed: If you look at the definition of essential services in New Zealand, and I was looking at this carefully last night, someone like Bunnings will fall in that definition. And they’ve been quite careful to say that people supplying those essential services can also stay open as well. There’s obviously no point in a Bunnings or a supermarket or anyone else staying open if they can’t get any goods in that. So the short answer is yes, in general terms, but have a look at the specific supply chain to make sure that you do fall within the essential services definition.

    Stu: Lots of questions coming through around how this affects youth centers and/or community centers.

    Ed: Good question. They were broadly covered and categorized when they were starting to talk about various forms of centers. They talked about place centers, galleries, and some other forms of places of public gathering. I think your best rule of thumb is the…in so far as it’s got any clarity at all, the wedding-funeral training guide. If you’ve got a small center where people are congregating in less than groups of 10, unless it’s expressly excluded in youth centers, I need to go and check. I don’t think the language youth centers was used last night. I’d need to check that. I’ll reply online to you. If it wasn’t specifically excluded, then use as a rule of thumb, if these are small congregations, that’s not what they’re necessarily trying to stop. Bear in mind that the childcare centers are still open, for example, as well.

    Stu: I’m a small coffee shop in a very large center. Do I need to stay open under the essential services banner?

    Ed: I’m a small coffee shop in a very large center, shopping center presumably. Do I need to stay open? No. You will make your choice as to whether that is a good business decision. Remember we talked yesterday about having three different hats as a business owner. Your first hat is your hat with your family, then your responsibilities there. Your second hat is as a director, owner, manager of your business and the duties to that business. Third is to your employees and your customers, I suppose, as well by proxy.

    They’ve all got a different balancing act that you need to achieve, and it may not be financially viable for you to stay open at the moment. It may be financially viable and you’ve gotta make that balance yourself and make those decisions. What I would say is that the longer you can keep your business open, if there is some financial viability to it, the cash preservation is really the broad strategy that most people will be applying at the moment. And you should be seeking to gain as much income as you can to preserve and hibernate. I saw the term used yesterday, which are quite light through the coming period.

    Stu: If you were to make someone redundant because of this pandemic, can you then reemploy them after it’s all over?

    Ed: Yes. Yeah, absolutely. There’s no…and regardless of how long this goes on for, you can make someone redundant and you can subsequently reemploy them. There’s no sort of a prevention of that in any way. I’ll just do a quick check to my guys here. Is there anything that we needed to address from Scott Morrison’s address? It seemed, when I stopped listening to it, to be very general.

    Man: It’s a very general. He’s announced a National COVID-19 Coordination Commission to help the private sector is what he said. He was very broad, and didn’t find much details, but he’s ensuring supermarkets that had supply chains to keep going. In terms of workers, he didn’t mention much about that at all.

    Ed:. So I was just hearing there, it didn’t seem like there was anything particular coming out of that. The lesson I’ve maybe just finished on, I’m very conscious not straying into claiming to be some sort of leadership expert here, but what I am trying to do here for our staff is communicate regularly and consistently. And I have to say, it’s sort of frustrating what I see at the moment. I know there’s another COAG meeting tonight, for example, in Australia, but he’s already said in the press conference today that there won’t be another press conference tonight. So I think people are understandably frustrated. What I would urge and we need to do, though, is don’t descend into worry about that. Don’t descend into sort of becoming a victim or catastrophizing.

    We all owe a responsibility to our staff to step up at this stage and lead them. And that will often mean not showing your worry or concern or confusion to them. It will be taking advice from those around you. Great. See, by the way, some people sharing advice with each other as well as seeking it from Employsure on this feed. Getting those stairs so that you can make decisions and then stay strong in the face of your staff. That’s an important aspect of leadership. Being able to show them clear thinking even if you’re not receiving it from government and anyone else that’s meant to be guiding you through this.

    So, guys, I’m gonna wrap up there. I will, as ever, with my team here, look through your questions and make sure that we’re answering those over the course of the day. Employsure clients, please do contact our advice team. We’re continuing to build our staff numbers here to make sure we can get those calls dealt with as brilliantly as possible for you. And also have a look at employsure.com.au/coronavirus, which is a resource center that’s available to every single one of you out there. Guys, we’ll speak again tomorrow. Let’s see what happens overnight. We really are going day by day at the moment, but hopefully what I’d love to see tomorrow is some questions about the planning stage.

    I had my planning meeting here with my local team yesterday at which we sat down and we did this. We looked at our worst case scenario if sales dry up for one, three, six months. What does that mean for us in terms of revenue? We looked at the consequential costs that we will save if that happens. Then we started to look at a more tricky bucket of costs as to what else that we could save, looking at saving on IT costs.
    Going back to some of us suppliers, for example, before we then start to say, okay, what are we gonna do with our staff? How do we best treat them? We haven’t finished that discussion, but it was a very positive experience, coming out of that feeling much more in control of the situation rather than just reacting and boxing at shadows.

    So remember, guys, that spring metaphor, we gotta be ready to spring back. Make sure we’re springs and we’re not just punch bags at the moment, taking the punches as they come day by day. That’s it from me, guys. I’ll hopefully see you tomorrow.

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