Flexible Wages Are More Rational Than Retrenchments
Hard times in business will naturally result in a shortage of funds. Thus, it is a phenomenon that no one wants to be part of. No matter if it is the lowest grade officer nor the business owner. Being struck with little business income may ultimately result in no pay for salary earners. That is why, in difficult times like where we are now, hit with the pandemic, it is essential to strategize the business so that it can stay afloat with government aid. Besides monetary assistance, the government, together with the National Wage Council, agrees that it is imperative to advise flexible wages during the pandemic.
When a company decides to cut employees’ wages, it comes as no joke. It may be logical for the business to save as much money as possible by reducing the operating expenses, including salaries. Some companies have resorted to shutting down business altogether, leaving employees without a source of income. This anomaly will begin to consume a healthy mental state of mind turning them into desperate people to acquire earnings. Hence, closing the company is not always the best possible solution unless it is inevitable. Therefore, advising for flexible wages during a pandemic is deemed the appropriate current solution for businesses to sustain and retain their workers.
As business owners are crack their heads to figure out how to remain in business while at the same time retaining employers, the Singapore government with the National Wage Council is urging businesses to offer flexible wages to their employees. The government is a genuine concern of companies and human capital assets as they play a significant role in the economy. Should the business resign to shutting down the business, the vicious cycle may spread to other industry sectors. With a flexible wage in place, companies can afford to retain local employees until the economy improves. At the very least, employees know that they still have a job, albeit with lesser pay. With that in mind, low-wage workers may find it harder to sustain living if faced with pay cuts. However, employers should note that wages must be fair and reasonable as people have necessary expenses to upkeep and provide special consideration to low wage workers. Companies must also note that the pay cuts are temporary and must restore actual wages when the business recovers.
Reskilling to Match New Units
Besides agreeing to pay-cuts, employees should be open to new skillsets their respective companies plan to train them. In tandem with the government’s call to business owners to restructure their business, employers should also provide upskilling and reskilling to their employees, given the company’s necessary changes. At best, if the company fails to retain its employees, the employees are ready to hunt for a new job with a unique skillset or perhaps start on their own.