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LETS GET DOWN TO BUSINESS.

Question :
We’re a travel operator with no revenue and currently the only source of income for my staff is the wage subsidy. I’m hopeful wage subsidy will be extended and optimistic about the long term future of the business when international borders reopen. In the short term what do I do with my staff when the wage subsidy ends- struggling to understand what “stand down on no pay means”, should I make my staff redundant, should my staff resign? If they resign will it impact their ability to claim income support. We don’t have a HR team  – any help gratefully received – thank you.

Question submitted 13/05/20 @ 10:07am
Industry: HR & Talent
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  • Morena, some good questions here. First question though, is there nothing your staff can do to keep moving the business forward, while they are getting paid, that is a time for productivity and alignment about creating the future, not waiting for it to come. There are a bunch of rules around notice on redundancy that you will need to be aware of – and others will comment, I just want to iterate back – to have a future, think about how you can get some business.

    Hello

    In terms of resignation, this is only a decision that an employee can make, not an employer therefore your options are agreed unpaid leave or you move to redundancies. There are pros and cons to consider. If you make staff redundant the downside of that is losing connection with them which will be important when things pick back up again. Another option (which you may have seen in the media used by Air New Zealand with some of their pilots) is to agree with the staff that they are in effect on unpaid leave until such time as business picks up. Reaching agreement with staff on this is key. Some people also use the phrase “stand down” for this arrangement. The difference between agreed unpaid leave and redundancy is that the employment relationship doesn’t end under agreed unpaid leave and so all employment obligations (other than the employer’s duty to pay the employee and the employee’s duty to work) remain in place. This includes the duty of good faith (ie keep communicating with your staff about the situation during the period of agreed unpaid leave). If you take this approach you will need to consider how you answer questions from staff such as “does annual leave still accrue during unpaid leave” or “can I take up other work while on agreed unpaid leave”. If staff do not agree to this arrangement then your business may need to consider redundancies instead.

    Hello

    In terms of resignation, this is only a decision that an employee can make, not an employer therefore your options are agreed unpaid leave or you move to redundancies. There are pros and cons to consider. If you make staff redundant the downside of that is losing connection with them which will be important when things pick back up again. Another option (which you may have seen in the media used by Air New Zealand with some of their pilots) is to agree with the staff that they are in effect on unpaid leave until such time as business picks up. Reaching agreement with staff on this is key. Some people also use the phrase “stand down” for this arrangement. The difference between agreed unpaid leave and redundancy is that the employment relationship doesn’t end under agreed unpaid leave and so all employment obligations (other than the employer’s duty to pay the employee and the employee’s duty to work) remain in place. This includes the duty of good faith (ie keep communicating with your staff about the situation during the period of agreed unpaid leave). If you take this approach you will need to consider how you answer questions from staff such as “does annual leave still accrue during unpaid leave” or “can I take up other work while on agreed unpaid leave”. If staff do not agree to this arrangement then your business may need to consider redundancies instead.

    Hi. you say you are a travel operator. do you own an experiene or sell travel services? either way do you have a customer base and understand who your top customers are? are they business or leisure? i know for fact bookings for NZ domestic travel are kicking in at a level higher than what was previoulsy suggested. there will be pent up demand from business and reuniting families. school holidays are coming up on peopoles minds and those who can afford and are confident will look to NZ for experiences. can you reach out to your customers and see what they are thinking/doing? yes you need to have a plan for your people but getting cash in will make the other problem smaller,

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