Sedex guidance on COVID-19

Considerations for businesses experiencing reduced demand for goods and services due to COVID-19

The following sections will consider responsibilities for employers who have reduced demand or a labour shortage due to COVID-19. Please note that businesses can fluctuate between these 2 situations – they may start with reduced demand but then be left with a labour shortage when their country, sector or customers start recovering from COVID-19.

 

Ensure people have sufficient income to survive

Business should seek to avoid or minimise as far as possible terminating employment and aim to mitigate impacts on workers if doing so[1] – see the following section “terminating employment contracts” for further guidance.

  • Identify workers who may be left without income. This may affect all workers, and some will be dis-proportionally impact e.g. piece rate workers, temporary workers, casual and informal workers and self-employed.
  • Consider alternatives such as reduced hours, voluntary unpaid leave or voluntary termination with redundancy packages for those who do so.
  • Reduced wages for the same hours of work should be the last resort before collective dismissal and when it is essential to keeping jobs. In these cases, ensure minimum wage is paid and that pay cuts are applied equally and do not discriminate.
  • Support workers to access any government funded benefits
  • Complement statutory sick pay where it exists
  • Help workers access local organisations who can support them.
  • Employers that use recruitment agents must work closely with recruitment agents when handling worker termination, wages or furlough, and ensure that workers can return home or have safe and decent accommodation, as well as sufficient income and food during this time.

Terminating employment contracts

  • Workers must not be dismissed without a valid reason related to the capacity or conduct of the worker or due to the operational requirements of the job.14 A worker cannot be dismissed because of a temporary absence from work due to illness or family responsibilities resulting from the COVID-19 outbreak.[2]
  • Where collective dismissal is being considered, worker representatives or elected trade union should be consulted with as early as possible and given relevant information so they can consult workers, provide options to avert or minimise terminations and help mitigate the adverse effects on the workers concerned
  • If a business is forced to close, employees will be among the hardest hit so treat your employees as “preferred creditors” and ensure that you pay any unpaid wages as a priority.[3]

 

Considerations for businesses experiencing increased demand or labour shortages due to COVID-19:

Many companies, especially those providing “essential services”, including farming, who are able to continue working in their usual workplaces during the COVID-19 outbreak will be facing a shortage of workers due to the health impacts of COVID-19, the restrictions on migration and / or an increased demand for goods and services. They will need to find ways to manage their businesses to meet demand.

To do this, businesses may need to do one or more of the following:

Increase hours/overtime

In exceptional circumstances, such as the COVID-19 pandemic, working hours can exceed 60 hours in any 7-day period. But this can only happen if the following are met:

  • this is allowed by national law;
  • this is allowed by a collective agreement freely negotiated with a workers’ organisation representing a significant portion of the workforce;[4]
  • appropriate safeguards are taken to protect the workers’ health and safety; and
  • the employer can demonstrate that exceptional circumstances apply such as unexpected production peaks, accidents or emergencies.

Overtime premium must be paid during this time for all overtime worked.

 

Hire new permanent or temporary workers  

  • Despite the fact that hiring workers may be extremely challenging at this time, it is essential to ensure that the recruitment of workers follow existing requirements and that workers have the right to work, are over 15 years of age, and do not pay fees, identification is not withheld and are not in situations of forced labour.[5]
  • Ensure workers who have symptoms of COVID-19, have been in contact with any person with COVID-19 or those that have crossed borders from countries with COVID-19, can self-isolate for an adequate period of time (following State or World Health Organisation (WHO) guidelines) before starting work.
  • Ensure workers receive contracts, with clear terms and conditions of work including their rights relating to COVID-19 and safety measures that they are entitled to.
  • Ensure that workers are given relevant training relating to their job and health and safety, including safety measures to protect workers from COVID-19.
  • With so many people out of work due to COVID-19 there are opportunities to hire and retrain people from other industries.

 

Subcontract work to other organisations

  • Companies may need to subcontract work to other businesses if they are unable to meet demand.
  • Inform your customers of this before subcontracting work to get their approval.
  • Ensure that your subcontractors are aware of and respecting safety measures to keep workers safe from COVID-19.

 

Accessing support for your business

Many governments are introducing economic measures to support local economies.[6] Please check with your local authorities to understand if they may apply to you. Measures may include:

  • Tax & tariff relief
  • Unemployment packages for laying-off workers
  • Government loans

In all cases it is essential to ensure workers are safe and are able to manage family or other commitments which may have increased due to COVID-19 and that labour requirements and local law are adhered to.

 

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[1] Employment Recommendation, 1982 (No. 166) and the ILO Standards and COVID-19 (coronavirus) FAQ: Key provisions of international labour standards relevant to the evolving COVID-19 outbreak

[2] ILO Standards and COVID-19 (coronavirus) FAQ: Key provisions of international labour standards relevant to the evolving COVID-19 outbreak

[3] the Protection of Wages Convention, 1949 (No.95) and the ILO Standards and COVID-19 (coronavirus) FAQ: Key provisions of international labour standards relevant to the evolving COVID-19 outbreak

[4] Where there is an existing collective bargaining agreement (CBA) or some form of worker representation body – these should be approached and/or used to consult with workers on basic terms and conditions such as hours, overtime hours, shift patterns and Operational Health and Safety during these extended hours.

[5] For more information on forced labour and responsible recruitment, please see:

[6] See the OECDs overview of key policy responses from the OECD here: http://oecd.org/coronavirus/en/#id-7

The ITUC’s “Putting People First, 12 governments show the world how to protect lives, jobs and incomes” can be found here: https://www.ituc-csi.org/IMG/pdf/20200327_ituc_covid-19_countryresponses_.pdf