Practice Management and COVID-19

Fiona Martin , 25 March 2020

Building on areas of need identified in the recent ACA Pulse Check Survey No.1, Fiona Martin discusses the key areas practices should be working on, and answers some FAQs about leave under various circumstances.

Many practice owners are feeling overwhelmed as the COVID-19 global public health emergency forced shutdowns and an unprecedented economic downturn. There are many pressing demands – moving workforces from office to home, meeting project commitments, offering a range of leave options, thinking critically and creatively about retaining staff, and keeping the practice afloat. In addition to self-isolation and overt social distancing, job insecurity is becoming a big issue for many.

Managing staff – and managing them well – needs time, dedication and leadership. In architectural practice during normal times, managing people can be treated as an aside as project loads and client demands dominate the working day of most practice owners. Day-to-day, many find it hard to also keep up with industrial relations obligations, employee entitlements, professional development and performance management, grievance handling, health and wellness and safety.

However, we must also focus on these matters if practices and the profession are to weather this current storm. Demonstrating leadership is critical in a crisis!

So, what should practice owners do? Put simply, radical transparency is required, along with careful business continuity planning. This means creating a culture that is direct and honest in communication, where sharing of company strategies builds trust and loyalty and distills the realities upon us.

Radical Transparency

Being honest and authentic is the best way to ensure employee confidence and to deal with their anxiety. Job insecurity can be scarier than the virus and will have mental health impacts if not managed well. It is also important to talk about what could happen in the event of a market slowdown and the wider impact of the virus.

Consultation should not be left too late. It’s a two-way street. Good communication allows staff to share any concerns with practice owners, who can promptly consider any matters raised. Consultation is also a legal obligation. Under the Architects Award and state-based Workplace Health and Safety Acts, business owners have a duty to consult employees on major workplace changes. This can be fast-tracked in a crisis.

Business Continuity

Don’t wait. Plan now.

Business continuity planning involves developing a strategy to deal with potential impacts, to reduce or eliminate their effects, and to make informed decisions at the right time to ensure recovery and continuation once the crisis is over. Business continuity plans usually centre on one-off force majeure events like extreme weather, earthquakes, terrorism et cetera. To date, these plans have rarely included unprecedented global pandemics.

Plans should include preparing to deal with the following:

• Projects being cancelled or put on hold
• The consequences of relying on consultants who may be impacted (delaying lodgments and submissions)
• Reduced staff productivity (adjusting to working remotely)
• Disrupted materials supply (for example, lighting from China, stone from Italy)
• Not meeting invoicing targets (reduced cashflow)
• Debt collection
• Client insolvency
• Government support packages being released

Contingency should also include decision making responsibilities and lines of communication if anyone in the Directorship contracts the virus.  Are project leaders across one another’s projects should they fall ill?

In addition, planning for alternative working arrangements should be taken into consideration when assessing debtors, cash flow and project programming. This includes the impact of paid and unpaid leave, reduced hours/days, pay reductions, and redundancies. A Business Continuity Plan should also identify at what point those changes should kick in, and what the triggers are.

Practice owners should also consider the positive impact government support packages may bring before defaulting to terminations.

Business continuation planning assesses the best economic way to ensure job continuation and business survival without a major restructure, meaning redundancies. This may not always mean no redundancies, but the goal is to reduce them.

Remote Working

In addition to sorting out the logistics of the wholesale move to working from home it is important to ensure cyber security, to create open lines of communication, to keep a positive social cyber connection and to maintain productivity.

It’s important to recognise that many, if not most, practice owners and project leaders will have not led remote teams before. They will have teething challenges with communication and engagement. Giving training and support to managers who experience frustration and stress when managing from afar, and giving employees the opportunity to provide constructive feedback, is invaluable. This enables managers to learn and adapt quickly.

To be successful, managers must think about how they evaluate their team’s performance when they can’t observe them or the number of hours spent at their desk firsthand. Remote working requires high levels of trust in employees, and giving fair and frank feedback on tasks not met and praise and recognition where due. This should all be done online one-on-one, by having a conversation on the phone or through video conferencing (not on email).

Retaining Staff

The Federal Government is encouraging employers to retain their staff as much as possible, as they will be needed when the economy bounces back.

In the event of reduced project workload, there are several alternative working arrangements that can be put in place to help retain staff. These may include offering employees to use up their Annual Leave, to take Leave Without Pay (LWOP), work reduced hours or days, consider pay cuts or even potential secondments between practices if viable. Seconding during the GFC was a key tactic in retaining core employees as some sectors were hit worse than others.

Standing down staff for a period of time may also be an option. These are all alternatives that should be explored where practicable, before voluntary redundancies or forced redundancies should be considered. Once again, it is important to have a clear communication plan for employees so they’re aware that alternative working arrangements may need to be implemented for a set period to retain jobs.

Managing Staff in Quarantine and Self Isolation 

It’s vital that everyone uses common sense and is adaptable during these uncertain times. When negotiating workplace flexibility with employees I always ask them to “be flexible in your own flexibility”. It’s a matter of brokering a fair deal between employee and employer, meaning balancing the needs of the employee with the needs of the business.

Employers are not obliged to pay over and above the entitlements stated in the Fair Work Act’s National Employment Standards (NES). However, employees may not be happy about having to use hard-earned Annual Leave accruals for isolation, at a time of global economic uncertainty, where they would much prefer to hold onto those entitlements. Where commercially feasible, employers may consider providing additional Special Paid Leave (COVID-19 Leave) and/or relaxing leave policies. Special Paid Leave is any arrangement granted to an employee that does not come under existing types of leave.

FAQs – leave and COVID-19

A range of types of leave are relevant for staff in relation to COVID-19.

Personal/Carer’s Leave is available to employees who are ‘unfit for work’ because of an illness or injury affecting them, or are caring for a member of their immediate family or household who is ill, injured or has an unexpected emergency. (Personal/Carer’s Leave was previously known as Sick Leave.)

Under the Fair Work Act, 10 days of Personal/Carer’s Leave a year is built into salaries and accumulates year to year if not taken. This is vested with the employer until it’s time to take it. Personal/Carer’s Leave is not paid out upon termination.

If Personal/Carer’s Leave is not accessible, or has been exhausted, employees may then, by agreement, access their Annual Leave until exhausted (or go into deficit). After this, they may then access Leave Without Pay (LWOP).

Employers may also consider establishing discretionary Special Paid Leave to support employees in the unusual circumstances surrounding COVID-19.

The following FAQs consider the different circumstances that may eventuate, and the different kinds of leave that are relevant.

Q: What if an employee is isolated but not diagnosed with COVID19?

There are two scenarios to consider here – an employee who is self isolated and symptomatic, and employees who are self-isolating but are not experiencing symptoms.

Firstly, if an employee is self-isolated and symptomatic (cold/flu symptoms) and is tested and awaiting results, the absence is covered by Personal/Carer’s Leave while ‘unfit for work’. If no Personal/Carer’s leave is available, then alternatives discussed below should be worked through.

The second scenario is when an employee has come into contact with a person who has COVID19 or with a person who has returned from travel overseas, or where an employee themselves returns from travel overseas, but is not yet sick themselves. In this situation, an employer’s first preference would be for an employee to work from home during the isolation period, thereby maintaining a paid wage and productivity. The ACA case studies demonstrate how some practices are managing the transition to remote working.

Personal/Carer’s Leave is not technically accessible to those requiring isolation, but not yet diagnosed as sick. That said, an employer may permit access to Personal/Carer’s or Annual Leave in this scenario. Employers should remember that Personal/Carer’s leave is built into salaries – access to it shouldn’t be judged or begrudged.

Where Personal/Carer’s Leave and Annual Leave balances are exhausted, an employer may allow employees to run ‘into the red’ (deficit) on their Annual Leave. Where none of these leave options are possible, then Leave Without Pay (LWOP) would be considered a last resort.

It should be noted that any leave accrual in deficit may be repayable as a debt to employers upon termination (if such term is included in employment agreements). But this can also be waived at termination – and employers may consider this under the current circumstances.

As a practice owner it is worthwhile considering whether discretionary options can be accommodated, while balancing the short-term cost associated against the longer-term benefits.

Q: What if an employee is unable to attend work as they have a positive test result for COVID-19 or need to care for an immediate family or household member with COVID-19?

A positive result may be traumatic and at worst critical. Employees who are diagnosed with COVID-19 may access their Personal/Carer’s Leave, as may those who need to care for an immediate family or household.

If an employee has exhausted all Personal/Carer’s Leave, they may then access their Annual Leave until exhausted (or go into deficit) and may then use Leave Without Pay (LWOP). Under the circumstances discretionary Special Paid Leave, mentioned above, may be granted so they do not suffer from loss of wages during quarantine and recovery.

Q: What if an employee does not wish to attend work as they are worried they will contract COVID19?

It is important to acknowledge that the uncertainty of a pandemic may cause some employees to experience anxiety and fear. Employees may also have pre-existing underlying health conditions that make them susceptible, such as asthma, diabetes, a heart condition or be immunosuppressed. Mental health may also be a concern.

Clear communication is key. Ask employees to talk honestly with you. You may also be able to refer them to someone who can give additional counselling support. If an employee is asymptomatic and able to work, but unable to attend work, the employer’s preference would be for the employee to work from home. Otherwise, an employee may be granted access to Annual Leave or Leave Without Pay (LWOP).

Q: How do working parents balance remote working with caring for children?

Some working parents may be able to work relatively normal hours from home, depending on the age of dependents. Working parents who don’t have care may access Personal/Carer’s Leave. In this case, any hours that an employee is able to do as work must be paid. The main goal is to keep a wage for the employee and productivity for the business. Employers should be flexible when these hours may be worked, remembering that a partner may also be working from home.

There are a range of possible scenarios. For example, hours may be worked at intervals in the day when another carer / partner is at home, or at the end of the day. An employee with caring responsibilities could commit to say four hours (a half day) of work, those hours could be worked 1–3pm and 7–9pm if that suited, or in one block (say 6–10pm or similar).

Each arrangement needs to be discussed on a case-by-case basis and agreed with the Project Leader. If a working parent cannot work from home at all, after Personal/Carer’s leave is exhausted, an employee may be granted access to Annual Leave, Special Paid Leave or, lastly, Leave Without Pay (LWOP).