Over the last several months we have seen many of our clients deal with the difficult reality of shutting down their businesses.
Time after time we have seen employers doing everything they can to try and mitigate the effects of COVID-19 on their businesses. Sadly, in many cases there is no choice but to either permanently lay people off, or at least, temporarily stand them down.
A stand-down, otherwise known as a furlough, is an alternative to redundancy. It is a way of saying to your employees “We have no choice but to shut-down right now. We expect we will be back up and running when the economy and restriction of movement allows, and when we are, we want you to be around.”
This is a vital message to be sending to your employees at the time of being stood down. Make sure you let them know they are valuable to you and your business or organisation.
Sidebar: What does the word furlough actually mean? What does stand-down mean?
The word furlough originally referred to “a leave of absence given to soldiers.” It was borrowed from the Dutch verlof, which literally translates to the English word leave.
The term stand-down is also originally a military term. It was originally defined as a temporary cessation of offensive actions; cease-fire; truce, but also relates to a work stoppage or layoff.
Before implementing a stand-down
While there are plenty of articles about the legal aspects of standing down or furloughing, the following addresses some broad points HR professionals might like to consider before implementing a stand down.
- The first is step is to make sure stand-downs are the right decision. While some people may disagree, stand-downs are ultimately an employee-retention strategy that can be put in place due to temporary financial difficulties (such as recessions and pandemics).
- Managers need to carefully consider the types of employees that will be stood-down and who they are.
- Further to this, there may need to be some consideration of equity and communication: namely different treatment of people with the same roles
- Part-time, temporary, or contract employees may not be eligible for unemployment benefits while being stood-down.
- The risk of losing star employees or the cost of having employees with specific knowledge cease working may also outweigh the benefits of a stand down.
- Managers should evaluate the perceived fairness of stand downs as they can affect a significant proportion of the workforce. This may strike some employees as unfair. To alleviate this, we have seen employers spreading the pain, by rotating teams, departments or divisions so employees are not forgoing their pay checks for several weeks at a time. You could also consider imposing a reduction of hours across the board (listen to our last podcast with Jodette Cleary from hipages to learn more about how this strategy worked for them), or using other cost-savings measures such as salary cuts for senior leaders.
- Employers need to give their employees as much advance notice as possible. Research has shown that employees are most likely to trust their managers, when their managers communicate what they intend to do, why they have chosen that strategy, and how employees will be affected in a timely manner.
- Once this has been done, best practice is to have your managers communicate with their team via Zoom or a phone call so that employees have the opportunity to raise concerns and questions and the employer’s reasons for furloughing employees explained by the manager.
- Managers should collect all the appropriate contact details of their team, especially if the stand down means those employees will no longer have access to their work email.
- Managers should explain what they would encourage their employees to do, while they are stood down. This helps to create mutual expectations: it could be to use the time to keep fresh; to keep up to date; to encourage them to take a course; to watch Netflix and treat it as a holiday.
Have you been faced with the difficult task of standing-down employees during the current pandemic conditions? What have you found to be the greatest challenges or most useful tools in managing your workforce during this difficult time?
If you have a story you’d like to share, or you’re especially proud of the way your organisation has operated throughout the challenges of 2020, I’d love to have a chat and share your story on my podcast, YouTube and blog. Please get in touch by filling out this form, and my team or I will be in touch to schedule a time to chat.