As a response to the economic downturn posed by COVID-29 crisis, Singapore’s National Wages Council (NWC) has enacted new guidelines. As stated in the guidelines, pay cuts might be unavoidable as a cost-cutting measure for the business continuity plan. However, NWC urged employers to ensure management “leads by example” before implementing the cutting system.
The council also suggested that employers should continue to reward employees with bonuses commensurate with the company’s performance and employee’s performance. “In good times, we share gains. In times of crisis, we share the pain – each making mutual sacrifices to sustain businesses and save jobs,” said Josephine Teo, Minister of Manpower Singapore. And to sustain businesses and save jobs, here is a contingency plan businesses can adopt in order of priority.
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Business leaders must focus on protecting employees. Many studies have revealed that mental, psychological, and physical wellbeing are greatly affected by COVID-19. Employees, including payroll staff, might have to work remotely with limited access to systems. Therefore, a contingency plan for payroll staff, who help assess businesses contingency wages and costs, should become a leader’s priority too.
According to Matthew Stark, a partner at Mazars UK, there are two scenarios where a company’s payroll might become chaotic.
Payroll mishaps as a result of having no team in place could adversely affect business. Payroll team is responsible to communicate and execute employees’ wages correctly and consistently. Without them, the salary might not be paid on time. Consequently, employees might feel a financial burden as a result of late payment.
That said, when the payroll team is unavailable, those who step in to support business, such as manager, secretary, or recruiter, need to be able to collect any required information and process this into payroll software.
If your business uses a payroll bureau, HR managers should know how to give the bureau all the information they require. Generally, the payroll bureau will need the following information: starters and leavers, permanent changes, pension changes, sickness and absence recording, and parental leave changes.
Yet, what if the payroll manager or HR manager is ill, thus, unable to process the payroll information above? Stark suggested that in this situation, employers must ensure to have a solid and transparent plan to pay employees in the coming months.
Moreover, it might be worth considering asking whether any outsourced providers have experience in your payroll system. If so, count and ask them whether they can operate your payroll for a short period as a contingency plan. Employers must also consider the following questions for further planning.
At last resort, employers must consider an additional, appropriate staff in place with access to all payroll, payment and pensions system. Employers can start by having training for a chosen candidate who can be trusted with this process. If employers have a concern about the resilience of the payroll process, it is worth considering outsourcing this critical function to ensure that payments to employees are protected, added Stark.