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Salary cuts: Telling a bad story in a good way

19 Apr 2020

Covid-19 is clearly the world’s greatest crisis, one that governments, businesses, and people are reeling from. Nations are crumbling internally to this virus, and the havoc that is being wreaked on people, businesses, and governments cannot yet be fully comprehended. The magnitude and depth of the catastrophe is yet to be understood and any projections thereof, are simply projections. The steps taken by our Government are decisive and meant to flatten the curve and undoubtedly, the powerful constituents of society, led by the Government, healthcare ecosystem, financial institutions, as well as corporates, are rallying together to address the situation. The scale of the problem is humungous and we have to collectively do our best to resolve it and come out stronger. In a situation like this, corporate conduct will be under intense scrutiny and any anomalies would get magnified, representing huge reputation risks. At a time like this, it is less about messaging and more about corporate behaviour. All corporate action and communications should be examined through the prism of empathy and compassion. A high level of sensitivity to stakeholder expectation is advised.
In the immediate aftermath and purely from an internal comms approach, I would suggest companies to think critically about how to tell their story. Prioritising employee communications and support for the community is critical, with timing also crucial. Whatever needs to be said must be weighed against “is it the right time?”, “is it the right mood?” It’s important that business leaders focus their communications not only on the impact on their business and bottom line, but they must acknowledge and address the profound impact on the lives of employees and those around them. Such behaviour will be remembered heroically. In our country, purpose and commitment have been put to test among many diversified, blue-chip conglomerates and manufacturing giants. Corporate leaders are scrambling to combat the stress on their financial system with a queue of them promising to forego part or all of their salaries. However bad the coming weeks and months will be for business, and bad it certainly will be, at some point, Covid-19 will be behind us. The communication with employees, workers, customers, and stakeholders will be the make or break of reputation, for which business leaders must be seen as putting employees first and profit second. This is an unprecedented time for all of us and there may be a contingent of employees that have never experienced instant economic turmoil of any kind. Layoffs and salary cuts are inevitable given the new economic reality, but the manner of communication is paramount. While the world faces its greatest trial of the century, in Sri Lanka, internal memos to staff on salary cuts have become public property. Suddenly, the HR (human resources) values of several top businesses, diversified, iconic conglomerates revered for decades as a beacon of business leadership have come under the spotlight, simply because their message was not understood in its context. Widely circulated on social media, read by all and sundry, these letters to staff fed itself to public scrutiny. Perceptions of insensitivity and absence of long-term plans became the topic of conversation in calls and chats among young professionals, who now find time on their hands. From an internal communications perspective, the change was too quick, too traumatic for the employee to grasp, who perhaps had no intent of retaliation but was too emotionally charged and plied it in the digital sphere. From a PR (public relations) perspective, such news is best done personally and privately first, before an email or a letter, which might be perceived as impersonal. The tone of the letter matters, remembering it’s much harder to be on the receiving end. While the pandemic seems to make it obvious why cuts are necessary, providing context on what the businesses are doing to reduce other costs, is an option. The memos could have asserted the company’s attempts to stymie unemployment. Their commitment in ensuring that “you, your colleagues, and co-workers” will have a job/“in ensuring zero loss of jobs of our entire workforce, whom we value very much (several thousands in many cases)”/“we seek your support in protecting the livelihoods of your co-workers”, etc. Somehow, the narrative changes when compassion is sought. My humble submission is: Use your values to give people insight into how you made the difficult decision. The writer is the Chief Executive Officer of Adfactors Public Relations Lanka and counts over 20 years of PR experience across all practices from brand PR to public affairs and crisis management


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