At Mercer we believe that looking after our employees at this challenging time is critical. Therefore, as Hong Kong prepares to emerge from COVID-19 and return to a new normal the pressure is on for individuals and organizations alike to adjust. Along with an unprecedented public health emergency, COVID-19 has also triggered an economic crisis and the consequences on both businesses and people is severe.


As Kristalina Georgieva, Managing Director of the International Monetary Fund says, “It will take us much longer to have a full recovery from this crisis”. As we balance virus containment with business re-opening and face additional uncertainties in global markets it is hard to find secure footing. That is where Mercer seeks to add value. We believe that reinvention may be necessary for organizations to weather the storm but, when they do, returning to a new normal will be possible, and may even lay the foundations for continued, future successes.


Insights on workplace readiness: preparing and maintaining safe workplaces


How should organization prepare their workplaces? How do you make it a safe place for employees to work, and continue working even in the case of reinfections?


The renowned Dr Andrew Wong Tin Yau and Honorary Consultant in Infectious Disease at Gleneagles Hospital has some suggestions. In a recent webinar, Dr Wong covered how to get our workplace ready, the key items in crisis management and communication plans and discussed management checklists.


As he wrote in an article in the Hong Kong Economic journal, it is important to be prepared in advance, for when employees come back to work. Knowing what happens if they get sick, communicating with them, keeping social distancing in place in the office, and general hygiene and cleanliness in the workplace are key. In essence, it starts with screening and triaging employees, isolating cases and then keeping the workplace clean


“We don’t know when a second wave or third wave will come, so we have to be on high alert at all times,” says Dr Wong. “It’s important to do drills or exercises in calmer times to prepare for more urgent times.” He also noted that as many as half of the cases are asymptomatic, so proactive steps need to be taken at all times. It is important to isolate potential cases, before sending individuals for medical attention, so be sure to identify a location where they can be isolated. In addition to regular intensive cleaning, workplaces need to be cleaned and disinfected again once these cases have been identified.


Protecting the workforce by optimizing employee benefits


Thankfully, in Hong Kong, we are entering the return and reinvent phase: a stage where companies are learning from the crisis, assessing the potential impact and taking action. As workplace readiness and benefits optimization experts, Richard Roper, Health Business Leader of Mercer Hong Kong says, “What they do between now and the reinvent phase will set the foundation for post-crisis life.”


He and Sireen Cheng, Associate Director at Mercer Hong Kong believe that using a ‘Respond, Return, Reinvent’ model that Mercer has developed can help people in Hong Kong return to work. Another aspect to consider is using a back-to-work checklist, like the one we provide. The third, and most critical element in terms of both employee reassurance and financial considerations is how to review employee benefits in the current circumstances. Reviewing your company’s employee data now, to prepare for the next employee benefit renewal, can provide deep insights into where benefits can be improved, costs can be reduced or – in some cases – both. Reconsidering benefits to understand their provision and usage may allow you to tailor your solutions and provide a deeper understanding of underlying employee health issues. When these elements are combined with employee utilization, it is possible for companies to prepare more effectively for their next employee benefits renewal.


Rethinking total rewards strategies: cost management measures


When you combine Mercer experts including Brian Sy, Head of Career Products and Total Rewards at Mercer Hong Kong, Jackson Kam, Regional Practice Leader of AMEA Talent Strategy and Karen Tse with a legal expert from DLA Piper Hong Kong, the inevitable result is deep insights about how to put cost savings in place, responsibly.


How do you optimize your rewards programs in response to uncertainties?


It is wise to begin considering the current situation. Based on our research, 27.5% of employees can work from home, and 57.5% have experienced a moderate impact since some employees need to work on site, while 2.5% of companies have had to have a complete shutdown. The remainder (12.5%) have experience a significant impact, as most employees need to work on site.


The impact of this is that most companies (76.1%) have frozen their headcounts, nearly a third (29.6%) have reduced executive pay and delayed merit increases while others have reduced pay. 19.7% indicated that they have reduced incentive bonuses and require mandatory vacation, a common first step, as Helen Colquhoun explains. “A lot of companies are looking at annual leave to save costs – partly to avoid employees having big banks of annual leave accrued.”


Helen Colquhoun is a Partner and the Head of Employment at DLA Piper Hong Kong: a global law firm with lawyers located in more than 40 countries around the world. If you are curious about what you can ask employees do with their leave, from a legal perspective, here is her answer. Helen says that there is a difference between dealing with statutory minimum leave and excess contractual leave. “With statutory minimum you can direct employees as to when they take their leave, provided you consult with them and give them at least 14 days’ notice of the days on which you want them to take their leave. With excess contractual leave, then subject to the terms of the employee contracts and company policy, you generally have greater flexibility and can direct employees to take it.”


Can you reduce salaries, working hours and unpaid leave in Hong Kong?


“From a legal perspective,” Helen says, “you cannot, unilaterally, impose any of these on your employees in Hong Kong otherwise you run the risk of claims such as constructive dismissal, breach of contract or failure to pay wages. All of those measures need to be done with employee consent.” However, she goes on to add that in the current economic climate the majority workforce have been willing to agree to some sensible cost containment measures along these lines.


How do you actually reinvent your business to survive the current circumstances and thrive in the future?


The answer may lie in incentive management. Short-term incentive (STI) schemes are highly impactful and can both increase revenue and lower cost at the same time, if done well.


Brian Sy explains that it is important to focus on the business battles that you must win and keep a laser-sharp focus, to construct a portfolio that balances short-term fixes with longer-term transformation. STIs can be very useful here. While, they need to be redesigned to meet the challenges of our uncertain times, opportunities may be found in the most unexpected areas. If a sustainable design of STIs can be found and communicated in a way that considers employees’ reactions, this may well help companies weather difficult periods and build the foundation for them to thrive in good times.


As Brian says, “Considering employee perspectives is actually one of the most critical actions of STI design. Things like conducting win/loss analysis, anticipating reactions and having the right techniques to handle them, finding solutions that work for both sides (the company and employees), being transparent, communicating a lot and conveying the sense of fairness will be quite critical. These are all critical aspects for the STI scheme to be effective.”


How to return and reinvent your business: next steps


To find out more about how to return from COVID-19 and reinvent your business, take a look at our Return and Reinvent Toolkits – you can download them here. Or, if you have any questions about how to help your business or your employees survive now and prepare to thrive, please don’t hesitate to get in touch with us!

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