Yes. Would be the easy answer. The popular answer.
Let me share a little story and then we can really answer this question.
Local hotel in your city down by the local convention center. A national chain, but locally owned and operated. The husband and wife both work full time at this hotel. Every conference for the foreseeable future has been canceled at the local convention center. They went from almost full every week to under 25% full. One of their 150 employees just came down with COVID and now many others will as well. This employee wants to be paid for all 14 days, minimally, they have to be out of work.
Because of the 75% loss of business, the owners are seriously going to have to cut expenses to even stay open and escape bankruptcy. They care deeply for their staff. They consider their staff, family. Many have been with them for over twenty years. These are proud people.
United Airlines is going to have its business crushed as well. Turns out, people don’t want to fly on virus chambers during deadly outbreaks. Plus business travel is being curtailed at almost every organization. A big giant publicly-traded company that probably made billions last year in profit, when times were flying high and the economy was awesome. They could also have an employee come down with COVID-19.
Do you think both employers should pay sick leave for as many employees who need it, for as long as you need it? Just the local hotel? Just United Airlines?
Business Insider ran an article about how “brilliant” Trader Joe’s is for coming out and saying they’ll pay their employees to stay home until the virus symptoms are gone, flu, COVID, etc. It seems like the ‘right’ thing to do. You have sick employees and you want to protect them and your customers, and your brand, so pay them to stay home.
It’s an easy decision when you make 76% margin on 6 oz. of Organic Wasabi SeaFoam for $12.99. It seems ‘right’ (Editor’s Note: Tim has no idea if Trader Joe’s sells Organic Seafoam or their margins). Rich people buy overpriced, and quite tasty, products, great business model, well run, we’ve got the money, it’s the ‘right’ thing to do.
It’s not the “right” or “brilliant” thing to do for everyone. One organization decides to make that same decision and the entire company goes under. Or they can’t ever recover to the level they did and now they’re being sold to private equity who’s going to chop them up and sell the pieces. Brilliant business decisions are brilliant in very specific ways.
We all have stakeholders that these decisions will impact. Employees. Customers. Shareholders (F! The Shareholders, Tim!). Etc.
The reality is my grandmother and her pension might be one of the shareholders who are super concerned about being able to retire. Joe Plumber might have is retirement in his 401K that has a concern about these decisions. These decisions aren’t linear.
It’s easy to say pay all sick employees for as long as they need. Any moron can say that’s a “brilliant” business decision because it’s always going to be a popular business decision. The brilliant business decision, and maybe the most difficult one a leader will ever have to make, might be to not pay sick employees for their entire time they need to be off.
Each organization is going to have to make these decisions for all involved. It’s multi-dimensional and it’s complex. Before judging someone as being brilliant and an idiot, you would first have to understand each individual situation.
All that being said, we need to find ways to help our employees and their families out during times of crisis. That’s what the best organizations do. It’s not always just more money, more time off, it can be a thousand different things. The key is to have the conversations and be out in front with communications early, so employees aren’t having the additional stress of not knowing.
An excellent piece Tim. Many a small business cannot afford to pay wages for no work. They can cut wages, as long as they don’t go below minimum wage, in order to provide for a pay check in hopes that the emergency passes. Sayubg everyone can work from home is only a solution where you are not serving coffee or food as your business.
Tim , great piece.
I worked at a hotel company during the aftermath of 9/11 and was laid off from a dream job. I was also at a small hospitality group for the recession in 2006 – 2009. Everyone was impacted far more than we thought we would be, it hurt way more than we thought it would. There were a lot of unpaid vacation days and no one was safe.
We were already living paycheck to paycheck trust me I know what these folks are going through.
Here is the upside though, you are going to learn what really matters in life and it will get better. It always gets better. Every time, it always comes back better than it was before. We all lived through a terrible recession in the 1980’s in Scotland when they closed the coal mines, car plants, ship yards and steel mills. They Glasgow was nominated as Europe’s City of Culture and went through a huge boom.
We all lived through a nice one in early the early 90’s in California then had a gigantic tech surge. 2001 gave way to record hotel growth and profits. Same thing after 2006 – 2009 we have a bull market for 10 straight years!
Now it is 2020 and it looks like we may get our butts handed to us one more time. Guess what, we are going to get through it. Now, how you get through it is up to the individual. If you look at this as an opportunity to smile and grow personally and professionally you are going to explode out the other side when things turn around. You show up every day with a good attitude you will be the the last person they will want to let go. Or you can dig a hole of despair now, jump in and when this passes look up and see that everyone left you behind.
I have tried both sides of this attitude. Last time I chose to smile and grow and show up every day as the guy that would do whatever it took to get the job done. Unpaid, yes sir I’m in. Weekends too, you betcha. 70 hours a week plus part time in the evenings sounds like great fun. I’m not worried about this at all. It may get bad but this is not going to beat us by a long shot. Smile every day through this one and give thanks every day for another day and be light in a dark time. You will be surprised how fast this will pass.
Well said as always, Tim.
Scott Galloway mentioned something very similar on PIVOT the other day about SXSW. SXSW and their corporate sponsors aren’t going to suffer–it’s the catering teams and other small businesses (conference tech setup, chair rental companies, etc) that are going to be hit with canceled contracts. It’s a positive PR move to cancel travel because no one wants to be the company that has or caused the sick employee.
Context totally matters in this situation, and I think you’re right in pointing out that outcomes definitely vary widely when one seemingly best practice is used. Companies with <50 employees really need to descend into the particulars here and run the numbers.
Prof. Galloway is smart dude, he gets it!