PositivePeople July 23, 2020 No Comments

How to Build Empathy into your Restructure

How to Build Empathy into your Restructure

As a result of the impact of COVID 19 on organisations, the reality is that many businesses are needing to restructure to remain viable. For those employees affected, a job loss, in addition to the multi-faceted anxiety that this pandemic has created, can be devastating.   

We all necessarily have to take note of the legalities of how to implement a change process in a way that is fair and minimises the risk of any personal grievances being raised.

Rigidly following due process does minimise potential risk. It can also sometimes leave the impression, with both those affected and those employees who remain in the business, that the employer is cold hearted and uncaring. Given the COVID 19 situation, these perceptions can be especially strong.

Change processes are more successful for all involved with empathy built in along the way.

The feeling that exists within the organisation during the restructuring process and afterwards is a clear indicator of morale and also how employees view how the process has been handled and communicated. This in turn affects engagement and productivity, as well as potentially leaving an indelible mark, either positive or negative, on the organisation’s employment brand.

So, the ideal is to strike an even balance by following a fair process, but doing so with a very strong sense of caring and empathy for all of those affected, both directly and indirectly.

 

Outlined below are some practical pointers of how to show caring during the process:

  • Ensure that you plan the restructure very carefully so that it is professionally done
  • Make sure that an essential element of your plan includes a filter of empathy and caring throughout
  • Develop well thought out and carefully worded communications. As with any communications on a difficult subject, the facts have to be stated, but it is how you say and communicate them that makes the difference. Maintaining confidentiality is important. However, it is helpful to have others in the team understanding the need to be supportive of those directly involved
  • Take the time to put yourself into others’ shoes and tread lightly
  • After outlining the proposal, offer to allow impacted individuals to go home for the rest of the day or deliver the proposal mid-afternoon and let impacted employees go home then
  • Understand that different people respond differently and take that into account at the time
  • Outline access to the company EAP service or in the absence of this, the Government funded ‘Need to Talk? 1737’ service for counselling support
  • At the proposal meeting, offer time to employees during the work day to get their thoughts straight around what feedback they may wish to provide and prepare for the feedback meeting. Arrange cover if they need it
  • Realise it can be a difficult process for all concerned – CEO, Manager implementing the change, impacted employees and other employees. Be available to hear and discuss concerns from anyone throughout the process. If the issues raised are beyond your skill set, encourage people to access EAP or 1737 or seek other appropriate outside assistance
  • Sometimes the content of a proposal may take a while to process. Be available for additional questions or meetings if you think your employees require it
  • For those whose roles are disestablished, provide support with up-dating CV’s, LinkedIn profiles and practical guidelines on navigating the job market at this time

Separating from a business is counter-intuitive for a human being’s natural desire for social connection and approval. Showing caring and empathy never goes amiss, and can work towards reducing the stress for all concerned. Apart from being the right thing to do, especially at this time, it is also sets your organisation up as one that will be respected for its ethos.

This will have positive spin offs of loyalty, commitment and engagement from those remaining.

If you need help navigating restructuring, please make contact with us. Positive People have over 25 years of experience partnering with medium sized businesses. Call us on 09 445 1077 or email info@positivepeople.co.nz 

PositivePeople May 28, 2020 No Comments

Reviewing your Organisational Structure and Design

Reviewing your Organisational Structure and Design

29 May 2020

 

With changed circumstances it is smart to re-evaluate how your business is organisationally set up. Many businesses will have already taken this step and will have a lean but solid framework newly established. Steps to consider include:

  • Take an almost greenfields approach and evaluate what work you have in-house and what work you predict will come in through the door over the next period
  • Alongside any efficiency gains that could be achieved, work out the essential functions that you need and develop an organisation chart that can deliver the outcomes required
  • Establish job descriptions, skills and competencies required for each of the roles
  • Evaluate current resources against the ideal arrangement

 

Either rejig the organisation chart to accommodate current skills and competencies with some tweaks to roles. Any changes to encumbents’ roles requires discussion and agreement and formal changes to employment documentation

OR

Decide to restructure the business along with the creation of new roles in a new organisation chart.

 

If a restructuring is decided upon, then a full restructuring process needs to be mapped out prior to commencing any action whatsoever. Assistance with mapping out and operational implementation is recommended. This is a complex and often fraught process that needs to be conducted to the letter of the law to minimise employment and reputational risk

 

Every business is different and, as such, will have different HR needs. Positive People is available to help. Call us on 09 445 1077 or email info@positivepeople.co.nz

Workforce Planning and the Prospect of Restructuring

Workforce Planning and the Prospect of Restructuring

* Last Updated 14 April 2020

 

Planning

Over the past 4 weeks we have all become somewhat accustomed to constant and rapid change. We’ve learnt pretty quickly to take a step-by-step and day-by-day approach to avoid wasting time and energy on plans that quickly become irrelevant.

 

But, having dealt with the blow of the lockdown, the time has come to get ready to adapt and adapt again. Having contingency plans in place will be essential for you to navigate the next 12-18 months by being nimble and flexible.

 

A good starting point is to map out at least three possible scenarios – perhaps starting with a best case, worst case and a middle ground. These might include:

  • Best case – Level 3 after 4 weeks of lockdown. Reverting to level 2 the following week. No further lockdowns eventuate. Borders remain closed, but non-essential national travel re-starts in June. Government stimulus packages are relatively successful and the economy, including your industry, shows promising signs of recovery.
  • Middle – Lockdown is extended to 6 weeks. The country remains at level 3 for an additional 6 weeks, with some businesses needing to remain closed. National non-essential travel is restricted on and off throughout the year, there are regular school closures and occasionally it looks like another lockdown is possible.
  • Worst case – NZ returns to Level 3 after 4 weeks but it’s too soon or community transmission of Covid-19 has sprung back under the radar. After a few weeks at Level 3, another lockdown is announced and this one continues for another 6 weeks. After that, Level 3 with heavy restrictions for a further 6 weeks. Your business is unable to open properly at Level 3 but can operate to a limited extent on-line, but your industry has been heavily impacted. Sales are virtually non-existent.

Now think through what impact each scenario will have on your workflow and cashflow. Then, how will you need to change or downsize your workforce to match this footprint? What will be the triggers (sales figures, production levels, cashflow) that will force you to look at headcount reduction? Consider how you can avoid ‘death by a thousand cuts’ – where you need to downsize, will it be possible to make a more significant change to avoid constant redundancies and hours reductions.

 

Restructuring

Having completed the planning, you should have a clearer idea of the conditions and thresholds that may necessitate a change process. Or, in some cases, it may be clear that you already need to consider the prospect of restructuring your organisation and reducing your employee numbers. This is a complex and difficult process.

Here is a step-by-step overview of what you will need to do next:

  1. Plan
  • First, you will need to write a business case for why you believe change is required. Include important details such as sales figures and projections.
  • Next, write a communication plan – who is potentially impacted by this proposed change and how will you communicate with them? Individually, team meetings or a company-wide briefing? Will anyone be on leave during this time? How and when will you communicate with them?
  • Finally, get your ducks in a row. Review Individual Employment Agreements, read Job Descriptions, pull payroll information to double check details such as pay, titles and hours. Run a risk assessment for each – is the role you are considering to be disestablished similar to another role in the business? If so, do both employees need to be included in the consultation process as two positions becomes one?

 

  1. Consult
  • Draft up letters for all affected employees. The letter must:
    • Explain the proposed change
    • Outline the proposed impact to their particular role
    • Give the reasons for this proposed change
    • Say what will happen to them if the change goes ahead
    • Include the details for how the employee can submit feedback and the deadline for this
    • Either propose a time for a meeting to hear feedback, or offer the opportunity for the employee to book a meeting if they want to ask questions or provide verbal feedback
    • Emphasise that no decision has been made, and that this won’t happen until you have received their feedback
    • Give details of a proposed timeline. Seek feedback on this as well
  • Hold your consultation meetings.
    • Ideally, where only a small number of people are impacted and redundancy is a possibility you will hold these face-to-face. You can set this meeting up ‘informally’ by simply inviting the employee to a meeting, but we recommend that you let them know that what you need to discuss may impact their role, and that they are welcome to bring a support person – allowing them time to arrange this. In large company-wide restructures, and with the Covid-19 restrictions, this will not always be possible.
    • Ideally, read through the letter
    • Answer initial questions, but try not to get into receiving feedback in this meeting
  • Hold feedback meetings. Often questions will be raised at these meetings. If you don’t know the answer, commit to coming back with it as soon as possible. You must remain open, honest and communicative throughout. If you take too long to respond to questions or do not answer them at all, you risk an argument that the deadline for feedback should be extended.

 

  1. Consider Feedback
  • It is important to consider feedback in good faith. If, as a result of the feedback, you want to make changes to the proposal you need to decide whether to go back and consult on the new proposal.
  • Give yourself time to adequately consider feedback – usually 48 hours
  • If you’ve received a lot of feedback from numerous employees, group it into themes and write out your response to each ‘thread’ and any changes to the proposal made as a result

 

  1. Confirm
  • Having considered any feedback and made a decision, you need to draft up a second letter outlining your decision. This should include:
    • A summary of feedback received and your response
    • Any changes made to the proposal as a result of the feedback
    • What your final decision is, and the outcome for the employee’s role, including timing. If applicable, you may include details around final pay
    • If redeployment is an option or a selection process will follow, provide the details for this
    • Consider what outplacement support you can offer and outline this in the letter – this could include career coaching, assistance with writing a CV, an interview technique workshop, and financial planning resources.

Change processes can be very complex and are difficult for everyone involved. Emotions are likely to run high and it is so important that you get it right. Positive People can help. Email us at info@positivepeople.co.nz or call 09 445 1077 for a confidential discussion.

More COVID-19 FAQs Answered Here (issued 3 April 2020)

Issue #2: More COVID-19 FAQs Answered Here

 

Question: Do I need to consult or get agreement to reduce pay?

The COVID-19 lockdown is an unprecedented event, and there are differing views about whether you need written agreement to a pay reduction, or if you only need to consult. It is generally agreed that a unilateral pay reduction with no consultation is a high risk strategy. We recommend running a short consultation and seeking written (email or text) feedback or agreement prior to confirming the temporary change to terms and conditions. You can also use this opportunity to have employees indicate in writing if they would like to ‘top up’ their pay by taking some annual leave (e.g. one day per week).

 

Question: Can we use annual leave balances to top up the wage subsidy?

If you are passing on the wage subsidy, employees may agree to take Annual Leave to top up the subsidy. Likewise, if you have reduced pay to 80%, they may request or agree to take one day Annual Leave per week to maintain 100% pay. You may also direct an employee to take Annual Leave, but you must first try to reach agreement. If agreement can’t be reached, you must give 14 days’ notice and it must be from the Annual Leave ‘entitlement’ – you cannot direct an employee to use their ‘accrued’ balance.

 

Question: If I accept the wage subsidy can I make people redundant during this period if things change?

You need to try your best to retain your employees you are currently receiving the wage subsidy for. If you applied for the wage subsidy for any employees after the scheme was modified at 4pm on 27 March 2020, you must retain those employees or you will be in breach of your obligations. The WINZ website states that if you breach your obligations by making someone redundant you need to repay the subsidy within five days.

 

Question: What are the options if someone has signed an employment agreement but haven’t started work yet?

If you have offered someone work and they have accepted, they have the same rights as other employees – even if they haven’t started working for you yet. You can apply for the wage subsidy and pass this on from after their start date. Just like with current employees, you need to consult if you wish to change their terms and conditions (reduce hours and/or pay) or make them redundant. If you have a Business Interruption clause in your agreement, you may choose to invoke this. But remember, even with this clause you must ask for feedback before confirming suspension without pay.

 

Question: What happens if an employee was due to return from parental leave during the lockdown period?

Similar to the above, if this was the agreed date for the employee to return to work you must proceed with that plan. Therefore, you can apply for the wage subsidy for this employee and pass it on to them from their planned return date. You should still consult with the employee prior to confirming any changes to pay or hours during the lockdown period – even if they haven’t returned to work yet.

 

Question: An employee had an overseas holiday booked to take place during the lockdown and had Annual Leave approved. Now they want to retract that request (we are not an essential business) but I want them to take the Annual Leave. Can I enforce that?

Technically you can, but for fairness and simplicity, many employers have wiped all Annual Leave requests from the start of the lockdown and will review this at the end of the initial 4-week lockdown period.

 

Question: Can/should casuals qualify for the wage subsidy and be paid something during the lockdown?

Yes, they can – you use average weekly hours to calculate the amount. However, as casuals should have no expectation of ongoing work and you have no obligation to offer it, technically you don’t need to apply for and pass on the subsidy. If you review a casuals average hours and decide to apply for the wage subsidy scheme on their behalf, you should also consider whether they are a true casual. If they regularly work a pattern of hours and could reasonably expect this to be ongoing, they may be considered ‘permanent’. An important definition if you need to restructure down the track.

 

Question: What are the potential scenarios where we might be at risk of having to pay back the wage subsidy to the government?

You need to repay some or all the COVID-19 Wage Subsidy if:

  • You no longer meet the criteria for the subsidy
  • You’re not meeting your obligation to use the subsidy to retain and pay your employees,
  • You’ve received insurance (eg, business continuity insurance) for any costs covered by the subsidy
  • You have provided false or misleading information in your application.

You can check the obligations here.

Obligations if you applied before 4pm on 27 March

Obligations if you applied on or after 4pm on 27 March

You can also make a repayment if you were overpaid or made a mistake on your application.

 

Question: Did the minimum wage increase go ahead? I’m worried that I won’t be able to access the system to make the changes.

The adult minimum wage rate increased $1.20 from $17.70 to $18.90 per hour on 1 April 2020. However, MBIE recognises that some employers may not be able to action the increase immediately, while also complying with lockdown requirements. If you cannot process the raise in time, you should communicate with your employees about this. You should then process the increase as soon as you are able to do so in compliance with any COVID-19 restrictions in place. You will need to pay employees back for any hours that were worked, but for which the required pay rate could not be processed at the time.

 

Question: Does the wage subsidy always need to be passed on in full?

Not always. If your employee’s usual wages are less than the subsidy, you must pay them their usual wages. Any difference should be used for the wages of other affected staff.

 

Question: Can I reduce an employees pay if they’re on minimum wage but can’t work? What happens when they come back to work – partially or fully?

During the lockdown and beyond, you must still pay workers for the work they do. This means employees—regardless of whether they are working from home, or from premises to do essential work—must be paid at least the new minimum wage for each hour they work. If the employee cannot work during the lockdown and does not wish to use any Annual Leave entitlements, you can access the wage subsidy and pass this on in full without topping it up to minimum wage for the employees normal hours, or requiring the employee to do any work. You should still follow a consultation to implement this reduction in pay.

 

Question: What should employees be paid for the public holidays over Easter?

For employees who would have otherwise worked on the public holiday (had the lockdown not been in place and had not been a public holiday), then they should be paid for that public holiday at their relevant daily pay as set out in the Holidays Act. If the employees pay has recently been reduced, then the relevant daily pay rate is this reduced pay rate – unless otherwise agreed with them. We know some employers who have reduced pay are choosing to pay public holidays at the employees ‘normal’ full pay.

 

Question: How do we manage pay for staff returning to work on reduced hours – specifically the point at which we have to ‘top up’ the wage subsidy (if the wage subsidy is what we are currently paying)?

Employees must be paid for any hours worked at a minimum – however, the wage subsidy can go towards this pay. However, many employees who cannot work and have taken a pay reduction during the lockdown, will expect to be paid more when they return to work. How you manage this is really going to depend on what pay reduction you have applied, and the hours worked on return. We think it all comes down to communication. If you think that pay reductions will need to remain in place even when employees return to work (either at normal or reduced hours) it is important that you communicate this possibility early and then consult with employees fully when the time comes.

 

Question: What are our H&S obligations when people do start returning to work?

Employee safety is paramount. It is likely that when employees return from the lockdown changes will need to be made to the way you work to keep everyone safe. We will be looking to government advice when the time comes and implementing all recommended measures (e.g. social distancing) as a minimum. We also recommend the following:

  • If you don’t have a Health and Safety Manager, appoint one person to be the COVID-19 co-ordinator. Communicate this person (ideally a senior manager) as the first point of contact for any related matters
  • Identify your risks and work to eliminate, isolate or mitigate these risks
  • Involve employees in a brain storming session to get their ideas on how best to manage the risks to themselves and their colleagues
  • Make an emergency plan
  • Review your sick leave, absence and travel policies. You may need to issue amended versions of these policies for the duration of the COVID-19 threat
  • Communicate regularly, in over-drive, with employees via email, text and social media
    • Publicise the supported need for employees to go home if unwell or not to come in if unwell
    • Publicise the hygiene recommendations like hand washing, management of coughing/sneezing etc.
    • Publicise the Ministry of Health guidelines and information
  • If practicable, promote remote working/video conferencing and flexible work options where required
  • Keep up-to-date with the current situation in the country and follow official advice as it is presented
  • Develop a relationship with a medical provider/doctor. Alongside Healthline’s dedicated COVID-19 number (0800 358 5453), this will ensure you have trusted guidance available to answer questions and deal with concerns such as when an employee needs to self-isolate
  • Discuss and agree (as much as possible) anything that comes up with employees

 

We know that every business is different. If you need help with working through the HR implications of Covid-19 in your workplace, call us on 09-445 1077 or email us at info@positivepeople.co.nz

Change Management

Making Changes Smoothly and Without Drama

Plan a smooth restructure that enhances the business and allows the future to be tackled with confidence.

Sometimes it is essential to make changes in your organisation. Markets shift, customers demand more, technology advances and business practices move along. It is imperative that organisations stay ahead of the game and adapt to rapidly changing environments.

Making changes within your organisation to meet these challenges can often involve difficult decisions that will affect your people’s employment.

It is not just the human side of the changes that can keep you awake at night, but also the legal risks involved. Additionally, a badly handled restructure does your employment brand no favours. A badly handled change initiative can sully how attractive your business is to work for as well as negatively impacting on your current team’s satisfaction, engagement and retention.

Successfully navigating your way through a restructure, relocation or major system or process change requires expert planning and careful implementation. A fair process throughout is essential.

Once the decision is made to explore the possibilities of a change, then a proposal needs to be developed which explains the background, provides the genuine commercial reasons and provides a justification for the proposed changes.

Any changes contemplated must be for a genuine commercial reason.

A key element to be aware of is that from the moment a change idea is conceived until after all relevant feedback has been received is that it is only a proposal. Only after a fair process has been conducted, and all relevant feedback received and carefully considered can a decision on the proposal be taken. Up until that time the change contemplated is simply a proposal, nothing more. This is still the case even if you’re facing a certain change – for example, the lease running out on a premises meaning that some sort of change is inevitable.

The people affected need to be provided with a fair opportunity to provide their response to the proposal. If redundancies are a possibility then all alternatives to redundancy need to be explored to see if any people affected by the changes could be accommodated elsewhere in other roles, or other working arrangements introduced.

Once the decision on the proposal is made, then those affected need to be informed.

Throughout the process everyone affected needs to be treated with the utmost care and consideration. Suitable support in the form of the offer of counselling and CV/career path assistance should be offered to those affected. This will reduce your risk, but also ensure you are acting as a good employer and looking after your employees.

Because the discussions that are held are confidential, it can be difficult to maintain the engagement and morale of the rest of the team in the organisation as they naturally want to know what is going on. However, there is little choice but to wait until the whole process is completed before information like a new organisation chart and role descriptions can be shared.

If your Company is committed to creating a work environment where open dialogue, honest discussions, trust and fair processes are nurtured and promoted as part of the organisational culture, you and your team are most likely to come out of a restructuring process with a sense of optimism.

Following these guidelines should help you emerge from any change program with minimum risk and ready to take on the future with confidence. Positive People are well experienced in guiding, assisting and providing support to companies who need to make changes. Contact us today at info@positivepeople.co.nz or 09 445 1077 to discuss the details.