THE CORONAVIRUS CRISISHUNG OUT TO DRY
Otto English reports on how the COVID-19 outbreak has revealed the worst of corporate greed, as employees are left without their salaries being paid and are told to rely on Government support.
On the surface at least, much has changed in the way of workers’ rights over the past 50 years.
Before the mid-1970s, if you got sick, became pregnant or fell foul of your boss, you stood a very good chance of losing your job or getting thrown out onto the pavement. Yes, many unions played a vital role in protecting their members from the whims of management, but the legislation itself was patchy.
Maternity leave was introduced in the mid-1970s, but was not broadly implemented for decades. Statutory sick pay was only established in 1983. The minimum wage was only set up as late as 1998 – and in the face of fierce opposition from business leaders and Conservative politicians.
But, it’s not just employment law and workers’ protection that has undergone a quiet revolution in the past four decades; the culture has, for the most part, changed as well. Gone are the days when boards of directors didn’t have to show that they cared about their employees. Before the 1970s, workers were viewed as little more than drones, existing to serve the margins of shareholders and the interests of the management. Today, companies fall over themselves to demonstrate on their websites and in communications with employees that they care. Any company worth its salt has ‘values’ and ‘principles’ and dedicated teams in HR departments, which exist to look after their staff, their well-being and their rights.
And, in a crisis such as COVID-19, you get to see how much of that talk is real and how much of it is utter bullsh*t.
Forced Into a U-Turn
Over the past week, the businessman Tim Martin and his Wetherspoons chain have attracted particular criticism, after a video emerged featuring Britain’s best-known pub landlord telling his 43,000 employees that they wouldn’t be paid until the Government’s furlough scheme kicked in at the end of April. The furlough scheme is the Government-backed initiative to provide 80% of salaries to employees whose companies might not be able to meet the commitment during the ongoing crisis.
Martin suggested that his employees might want to go and work for Tesco in the meantime, but generously offered to give them their jobs back when he needed them again.
After the video went viral on social media, I was contacted by a number of Wetherspoons employees, who felt that they had been hung out to dry and that nobody was listening to their concerns.
One team leader, who has worked for the chain for almost five years and who has just had a baby with his partner, said: “They love to talk about values but the minute this happens they disappear into smoke? I don’t know how I’m going to pay my bills.”
The same employee, currently completing a post-graduate degree, stressed that he loved working for the pub, despite the low wages, because it was flexible and sociable. He stressed, however, that this was entirely down to the camaraderie of his colleagues and the area managers, who he claimed were every bit as despondent.
“Tim says they can’t afford to pay one month’s salary!” another employee told me. “But they’re turning over nearly two billion pound a year.”
As late as Tuesday afternoon, Wetherspoons was insisting that it couldn’t afford to pay its staff and that, while it wasn’t abandoning them, they would have to wait until April for the Government bail-outs to begin.
Many Wetherspoons workers are on very low wages. One member of bar staff told me that she was getting paid £8.60 per hour for daytime shifts and £9.60 for any hours worked past midnight. These are predominantly young people operating on very tight margins, with bills to pay and rents to meet. They have no savings to fall back on or lines of credit. The idea that they weren’t going to get paid until the end of April was troubling everyone I spoke to.
And then on Wednesday – after days of negative publicity – Martin and his team U-turned and declared that they would pay their employees’ salaries after all.
A happy ending for Wetherspoons staff but, unfortunately, the behaviour of that particular pub chain is just the tip of the iceberg.
I have been inundated with messages from employees of other big name firms over the past week too, expressing concern about the way they are being treated during this crisis.
Staff working for upmarket Italian restaurant chain Carluccio’s, for example, have been receiving a stream of messages seeking to reassure the chain’s “famiglia” that do nothing of the sort.
In one email from CEO Mark Jones they are told: “Our owner, The Jagtiani Foundation, has been very loyal to the Company and has, over the years, invested over £100m and never taken a dividend. Against this backdrop, it has agreed an additional cash injection that will enable the business to pay approximately 50% of the March wage costs that you are due, but I am afraid no more.”
The email goes on to suggest that the management are in the same boat, with the CEO stressing: “The Executive team has agreed to take an even bigger cut in salary and I have decided not to take any salary in March.”
But, there’s a big difference between low paid staff missing out on a month’s salary and the same fate befalling a well-paid management team.
The Jagtiani Foundation is run by Micky Jagtiani, an Indian Emirati billionaire businessman, based in the United Arab Emirates – but it seemingly can’t stretch to paying the full salaries of its low-earning staff until the Government’s furlough scheme begins.
One employee told me that his salary had been slashed by £500 – a huge sum of money for someone on a relatively low wage.
In Padstow – where celebrity TV chef Rick Stein has a chain of cafes, bars and hostelries – restaurant staff have also been laid off for the duration of the Coronavirus crisis and will not be receiving any pay until the Government scheme begins. In a string of messages to employees, Ian Fitzgerald, the managing director of Stein’s businesses, tells employees: “As of last night, our business will have next to NO money coming in but will still have bills to pay.”
Making it clear that staff wages are at the back of that queue, Fitzgerald helpfully advises his team: “I would urge you to consider your own financial situations – talk to your bank, landlords, mortgage companies etc. Consider seeking short-term alternative work in areas that need people now.”
One contact told me: “This will mean staff are paid for two weeks’ worth of March pay and will then have to wait until maybe mid-May to be paid the rest.”
Stein’s employees have been particularly irritated by the celebrity chef and his son appearing on social media, praising staff and asking followers to donate to a charity that helps “casual workers in the hospitality industry”.
Both Carluccio’s and Rick Stein have been contacted for comment.
But, they are far from alone among the big names suspending pay.
The Essential Service of Selling Lawn Mowers
Employees of the Heathrow Express rail service have also been told that they have been temporarily laid off and won’t be receiving any pay until the Government money comes through.
At least one company – responsible for running one of Gatwick Airport’s executive lounges – has also put teams out to pasture without pay, while trying to give it all a positive spin: “One of the options we want to explore is to offer you the chance to take some ‘you’ time. Now is your chance… to take a period of extended unpaid leave, to take a break, visit family and friends or explore new experiences.”
Quite how that could be achieved in the midst of a lockdown is anyone’s guess.
At the other end of the scale, there are companies – claiming to be vital industries – insisting that their staff turn up, even though it might present a threat to their health. Of those, the name of one company has been brought to my attention again and again.
Halfords is a well-known retailer of car accessories and bicycles and also runs 314 autocentres across the UK. A number of employees have contacted me to express concern about how well the firm is handling its staff during the Coronavirus crisis.
There are familiar tales of social distancing not being maintained, no hand sanitisers or gloves being available and potentially ‘at risk’ staff remaining on the frontline. While the autocentres remained open, the Halfords shops initially ordered staff home before having a change of mind and sending everyone back to work again.
This is one employee, “Steve”, who works at a retail store, in his own words: “Received a notification, through our works app, notifying myself and my team that we are closing down for three weeks on full pay. Then 48 hours later, receive another notification saying we are to reopen at full hours. Every customer I serve asks me ‘why are you still open?’. I have to reply saying ‘we are an essential service’. The mood in the store is worrying, we have vulnerable people in our store from our older colleagues to ones with pre-existing health conditions. Before everyone was upbeat and happy, currently it’s all glum. In no way is this my manager’s fault. They have been told to do so by head office.”
The son of another employee, in his early 60s and working at a Halfords autocentre, contacted me to express considerable concern that his father – who suffers from diabetes, heart disease and high blood pressure – is still being obliged to turn up for work.
“He has asked a number of times over the last few weeks to go into isolation for his own health, and following the guidelines set out by the NHS, Government website, and British heart Foundation, but had been told by Halfords that, if he does, he will not be paid and they will not apply for his 80% salary from the Government,” he said. “He must produce another(!) letter from his GP in order to do so, in order to confirm his illness.”
A third Halfords employee told me: “We have at risk people and no clear guidance as to what we should do if we’re at risk.”
In response to these accounts, a spokesperson for Halfords said: “We’re fundamentally changing the way our stores operate. Essentially, we won’t be inviting customers into our stores, but providing services and collection from the front of store, all within the social distancing rules. Obviously we have also asked colleagues in the most vulnerable groups to stay at home, and can confirm we will only continue to operate this service while we believe it is safe to do so for our colleagues and communities.”
Halfords is far from alone. I have been contacted by people working at clothing retailers, delivery firms, hotel chains and even a biscuit factory, who have told me that they are concerned that they are being obliged to work for no other reason than that their management believe they can maintain their profit margins in hard times.
“We are still selling lawn mowers,” one employee of a well-known online retailer told me. “Seriously, how is that a vital service?”
Another employee, working for a much respected building society, told me that they felt they were being sent into work needlessly: “Yesterday in the branch there were 12 staff to one customer… ‘good’ companies are putting people at risk and completely unnecessarily.”
It’s not all bad. Ken contacted me to say that his employer, Timpsons, has pledged to keep paying all of its staff 100% of their salaries for eight weeks and that, as a relatively new employee, he was completely taken aback by the unsolicited offer. Indeed, many people have told me anecdotally that their firms have responded brilliantly to the crisis, reassuring them that they can work from home and that their jobs are secure.
It is disappointing that, at a time of national crisis, not all businesses have risen to or met that standard – and these employers need to be held to account.
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