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Unions call on retailers to make pandemic-related wage premiums permanent

Unions representing essential workers at some of Canada’s major retailers are pushing back against the decision to eliminate wage premiums that were put in place to compensate employees for working during the height of the COVID-19 pandemic.

“The pandemic is not over,” said Jerry Dias, Unifor National president, in a statement. “The danger has not passed. These workers are no less at risk and are no less essential today than they were yesterday. There is no justification for ending pandemic pay now, or ever.”

The union, which represents some Metro and Loblaws employees, wants to make fair pay permanent. It created an online petition for people to ask leadership at some of Canada’s largest grocery stores and other retailers to institute the pay increases permanently.

The retailers, however, are rebuffing that call. Essential employees at Loblaw Companies Ltd., Metro Inc. and Sobeys Inc. will see their COVID-19 bonus pay eliminated Saturday, about two weeks after Walmart Canada employees experienced the cutback.

Loblaw announced Thursday in an email sent to workers that it has “decided the time is right to transition out of our temporary pay premium,” wrote Sarah Davis, Loblaw president, noting its stores and distribution centres “have settled into a good rhythm” and provinces are re-opening their economies.

The company started paying a $2-per-hour bonus, or about 15% more, on March 8 when the pandemic first started having a serious impact in Canada. It will stop the bonus pay Saturday.

Metro, which also started paying a $2 premium March 8, will end its bonus pay on Saturday as well, wrote communications manager Genevieve Gregoire, in an email.

Walmart Canada paid workers an extra $2 hourly in April and May, as well as a one-time bonus, wrote Adam Grachnik, director of corporate affairs, in an email. Pay returned to regular rates in June.

Empire Co., which owns the Sobeys and Safeway brands, launched what it called “a temporary Hero Pay Program” March 8 across its stores and distribution centres, according to an April 15 business update. All employees received an extra $50 weekly, while those working more than 20 hours per week also saw a $2 hourly wage increase.

The company sent a memo Friday to corporate store and distribution centre employees announcing the cancellation of the temporary program for corporate stores under its brands.

“As provinces execute their reopening plans and customer behaviour shifts, we felt that this was a natural time to end our Hero Pay program,” wrote chief executive Michael Medline in the memo, saying “you will be heroes to us and all Canadians forever.”

Unifor believes these companies should maintain these “long overdue” wage increases rather than eliminate them.

Many of these workers struggle financially, the union said in its petition, and hazard pay during a pandemic is the bare minimum employers should offer.

It called Loblaw’s elimination of COVID-19 bonus pay “wrong.”

Dias noted Loblaw “rightly” continues to enforce social distancing measures at its stores, so it “knows the risk is not over. It’s just trying to boost profits on the backs of its most vulnerable workers.”

The union released its statement prior to Metro’s announcement, but the union’s spokesperson Stuart Laidlaw said the sentiment applies to the Quebec-based chain as well.

While it doesn’t represent Walmart workers, it “absolutely believes that all retail workers deserve to be paid fairly, and that pandemic pay was a start,” he wrote.

The United Food and Commercial Workers union said in a statement it is “disappointed” with employers choosing to stop their extra pay practices while the pandemic is still active and some provinces still have various precautionary measures in place.

“UFCW Canada acknowledges that premium pay was introduced as part of the COVID-19 response, but the union also expressed that premium pay should be maintained throughout the pandemic.”

Loblaw stores have settled into a stable, consistent situation, wrote director of communications Catherine Thomas in an email, noting Loblaw invested more than $280 million into adjustments and safeguards, she said.

“The company is no longer benefiting financially from COVID-19.”

Metro noted a similar stability, with Gregoire saying the company is “no longer working under the crisis conditions that prevailed from March through May.” Metro implemented several prevention measures and is now transitioning into recovery, she said.

Walmart and Sobeys did not immediately respond to a request for comment on the unions’ reactions.

Dollarama Inc., which instituted its 10% temporary pay increase March 23, plans to keep it in place until July 1, according to a company statement.

“Dollarama continues to evaluate measures that can be taken regarding employee compensation both in the current business context and over the long term.”

Loblaw does plan to dole out one-time bonuses totalling $25 million, after consulting with the UFCW, which Loblaw president Davis called “a rewarding conclusion for our team.”

She said it will be paid to staff who worked shifts from March 8 to June 13 and will be about two weeks’ worth of the premium pay based on average hours worked over those 14 weeks. Workers will be paid the bonus on their first July paycheque.

Sobeys will offer a similar bonus to be paid by the end of next month, according to its memo. The chain will also accelerate plans for an employee discount program, which was initially planned to be in place by May 2021. It will now begin in the fall.

Metro will also pay its full-time employees an additional $200 bonus and part-time workers $100 by July 2, according to spokesperson Gregoire.

Walmart added a few incentives, said Grachnik, including ongoing, free access to tele-health care professionals and three new days for additional employee discounts.

 

 


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COVID-19 causes industry-wide labour disruption

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These are challenging times and to a large extent, previous models and economic expectations will have to be revised as our society muscles through this public health crisis. COVID-19 created a shock wave through our economy and is effects on the labour marketing are still being felt and understood.

Currently, Canada has furloughed close to 2.5 million workers with Toronto alone seeing more than a quarter-million people sent home from jobs to stay safe. Will the economy quickly reabsorb these workers once the all-clear has sounded? Indications are that over the short term there will be pent up demand in the market and this could be good news for retail and service sectors. Government economic initiatives will also help spur the economy. However, COVID-19 has created lasting damage to the trade environment and this will be felt over the long term following back to work.

Here are some figures we have been able to source about the impact of COVID-19 on employment in Canada. Restaurants Canada tells OCTANE that there are now more than 800,000 foodservice workers on lay off with 10% of Canada’s restaurants closing permanently. The ING group has reported the economy shrunk by 20% in March with some three million laid off across the country. The Edmonton Chamber of Commerce states that 3% of businesses in the city have closed permanently and 47% see this a strong likelihood in the coming period. There, 86.3% of companies have seen drops in revenue and 60% have had to lay off staff. About 40% of Edmonton businesses have shut down their offices.

Even though gas station and car wash facilities were deemed essential services (most provinces), there is still considerable pain with-in this sector across the country. Customer volumes are down dramatically with people isolating and operators are working hard to keep staff safe. For example, at Valet Car Wash, an eight location full-service chain in Ontario, they had to stopped interior detailing, a key point of revenue, and focus on automated exterior service. The company typically employs just under 200 workers, but the vast majority of Valet’s crews were laid off waiting to see what the future will bring. According to Karen Smith, Valet’s compliance and training manager, “We choose to close interiors for the safety of our employees. We are keeping exteriors open due to the fact it is a zero contact service.”

Valet’s experience is similar to what other operators across the country are finding. As we move forward the labour challenge will be competition from a wide range of businesses for the laid-off employees as the country gets back to work in the months ahead. Already businesses such as c-store, car wash and gas bar were being hit by high rates of turnover and difficulty in recruitment.

Before March, operators across the country had been finding it harder and harder to recruit the staff they needed and to keep the ones they already had in place. Indeed, the number of jobs unfilled in Canada’s private sector had grown. At the end of 2019, the Canadian Federation of Business (CFIB) found almost 435,000 unfilled positions in Canada, a value that is up by nearly 10,000 over last year.

Behind this was a declining labour force where gains in new workers have almost flatlined with an expansion of just 0.2% (BDC). Low wages and limited benefits packages also impacted businesses such as c-store, gas bar and car wash where their capacity to bring in new staff has been negatively impacted by competitive pressures from large operators such as Amazon and Walmart (Walmart is currently advertising job openings for 10,000 workers).

Among the most difficult spots to fill were in the services sector where businesses such as car wash found a 5.1% vacancy rate, a number well above the national average of 3.2%. The retail sector is also where 54% of respondents to a BDC study reported hiring was very difficult. Regionally, the Atlantic (50%) was tops in reporting trouble sourcing new hires. BC was next up at 45% with 40% of Ontario respondents telling BDC they had Human Resource (HR) challenges. Hardest hit were small businesses with between 5 and 49 employees. The study found 49% of businesses in the 5-9 worker set had real difficulty finding new staff with 55% of 10-19 worker enterprises reporting major challenges and 58% in the 20-49 worker group finding HR grief.

The Convenience Industry Council of Canada (CCIC) is a national body dedicated to convenience sector advocacy, research and education. Recently they took an in-depth look at British Columbia’s labour market. Findings mirrored other studies and showed specifically that the c-gas channel was being hammered by hiring and retention challenges. Industry participants to a round table discussion told moderators that:

  • Employees of any kind were difficult to find but especially difficult to find suitable ones.
  • They found very low response rates from ads.
  • They were interested in the Temporary Foreign Worker Program and found they could rely on that program to help fill positions but with recent program changes such as application fee increases and more paperwork, the process became more onerous and stressful.
  • Present staff is mostly students and mostly part-time. These workers tend to be very hard to retain and they quit easily often without notice.
  • Retention cost for employers is about $4,000 (e.g., it costs about $4,000 to recruit and provide each new employee with approximately 50 hours of initial training). After all that training, however, employers can’t pay wages high enough to recruit and retain high-quality people.

Help at hand

At Valet Car Wash, Smith reports they recruit using organizations such as Second Chance in Guelph, the YMCA and use federal government programs to assist with training. They also turn to Indeed, Facebook and through word of mouth. “Friends tell friends if the employment environment is good,” she says adding that they seek employees who are a good fit with Valet’s core values. “When the fit is there, retention is high. During our interview, I tell applicants about our values and ask them to give two examples of core values they possess,” she says mentioning that road signs can also be effective.

“We also use the local universities and colleges online career pages to post job openings and have had some success with the local high-schools co-op program, resulting in hiring after the co-op term finished, this includes students with disabilities, who have developed into valuable employees.

“Give some thought to the questions you want to ask in the interview, you want to make sure the applicant is qualified and understands the adverse conditions they will be working in; weather, noise, physical, fast-paced.  Not only do you want to hire qualified staff that can do the job, but employers also have to consider if they have the right personality to fit into the culture of your business.”

Smith tells OCTANE that at Valet they don’t do exit interviews with general labour, but do so for managers and supervisors who leave. She comments that this final talk with an exiting staffer can offer tremendous insight into working challenges every business faces. “The goal is continuous improvement in everything we do.”

Are temporary foreign workers still a viable option given the current state of affairs? The short answer is yes, especially once the dust settles from COVID-19 labour challenges and the economy corrects. Foreign temporary worker numbers have been climbing as Canada faces labour market shortages. By 2017 Canada had over 214,000 foreign temporary workers. This is a number that is up by 50% from 2015 and reveals a strong trend across the country.

“Restaurants, c-stores and gas stations can be challenging environments for hiring,” suggests Parvinder Burn, director with Canadian Immigration Centre, a consultancy specializing in student visa, business immigration and skilled foreign workers. He has seen Tim Horton’s locations with 110% turnover, gas and c-stores that are finding it tough to compete with wage and benefits from other businesses, and sites where temporary workers fill entire staffing cohorts. “Having skilled workers come in from other countries can be a good solution to these challenges. However, we see that businesses are both confused and intimidated by the government paperwork and regulations.”

Originally published in the May/June issue of OCTANE.


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6 tips to reduce employee anxiety about COVID-19

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In Convenience Store News Canada‘s recent online survey asking operators “How is the coronavirus affecting your business?” many wrote in with concerns about how to keep employees safe and healthy, not just physically, but mentally.

We reached out to the Canadian Mental Health Association for advice and they shared this.

With coronavirus (COVID-19) now officially being called a pandemic by the World Health Organization, public fear and anxiety are on the rise. Your employees may be experiencing a high degree of uncertainty, worry and stress about the health and safety of their loved ones, and how this pandemic may disrupt their work and personal lives. 

While employers are preparing responses to safeguard their business operations and protect the physical health of their employees during this crisis, it’s important to consider everyone’s psychological health and safety, too. 

In order to support the psychological health and safety of your employees, the Canadian Mental Health Association (CMHA) recommends employers consider the following six tips:  

  1. Have a plan. Let employees know that you are thinking and looking ahead, that you will stay well-informed and that you can answer the questions they already have: What if I get sick? How do I take time off work? What if my family member contracts the virus? You may want to compile frequently asked questions and direct employees to them often.
  2. Communicate, share and be open. Worry and fear grow in the absence of up-to-date information. Let your employees know that they can expect regular updates from you. Communicate even if the situation remains unchanged.
  3. Empathize. Share that you know it’s stressful. Recognize that it’s okay to be anxious. Remind your employees of resources (EAP) that are available for those who are experiencing stress.
  4. Reassure—as best you can. You can refer to reports indicating that most people who become infected with the virus will recover.
  5. Understand. Recognize when stress has become unmanageable for individual employees. Stress can lead to anxiety and even panic. Some employees may need mental health days and medical intervention in order to cope. Encourage employees to practice self-care activities on-the-job and reassure them that it’s ok to take steps to manage stress, such as relaxation exercises, listening to relaxing music or taking regular breaks. 
  6. Recognize this is not quite ‘business as usual.’ Know that work will likely be impacted—work will slow down (or get busier). Reassure staff that expectations will shift accordingly, and that’s ok. We will get through this! 

Additional resources for employers: 

COVID-19: Practical workforce strategies that put your people first

How to stay emotionally healthy during the coronavirus outbreak