Five formulas for the new workplace during COVID-19

With the pandemic massively changing our work set-up, what would you advise to help us in making an intelligent decision on the work-from-home program, retrenchment, reorganization, retirement, even the closure of our company? Are there specific formulas that should help us in rationalizing our decision? — King Philip.

A famous actress was asked her age by a nosy entertainment reporter. Without hesitation, she replied that she was 68. The reporter objected:

“But Madam, how can you be 68? I just asked your son about his age, and he replied that he’s 60.” The actress grudgingly replied: “My son lives his own life and I live my own!”

Anyone who supervises people has to consider their age to determine who among the employees is eligible for early retirement or retrenchment. That’s not all; you need to consider performance to come to a reasonable management decision. At first glance, the easiest way out is to identify the goof-offs, even the average workers who make a career out of doing as little as possible, just short of being kicked out of employment.

However, if you do that, you will be exposing yourself to legal trouble, unless the workers are clearly and properly informed of their job responsibilities. Goof-offs have to be warned about their poor work performance. First and foremost, you must review all the latest advisories of the Department of Labor and Employment so you can be guided.

Beyond that, let me help you with some important human resource measures that are supported here with formulas. Since it’s not easy to hire and fire workers, these formulas should also help you in convincing your management team, union and the labor department.

MEASURES AND FORMULAS
With or without the pandemic, these measures and formulas are useful to help you come up with an objective approach. Above all else, these should assist you in communicating openly with all stakeholders so that you can minimize the negative impact or even the rejection of whatever proposal you’re considering:

One, absenteeism and tardiness rate. This is easy to understand if you’re thinking of retaining a workforce on a work-from-home basis. If you have a high absenteeism or tardiness rate, given the almost perpetual heavy traffic and the poor condition of our mass transport system, you may as well consider going full-time with workers doing their work at home. The formula for computing the absenteeism and tardiness rate is this:

Absenteeism or tardiness rate =

No. of working days lost in a given period/Total workers in the same period

Two, competitor salary ratio. This allows an organization to determine the competitiveness of its salary compared to those offered by its competitors or industry standards. Knowing the ratio would help management determine the company’s potential and capability to attract new employees and retain them in the long-term compared to other organizations.

Competitor salary ratio = Salary paid by company/Average salary paid by competitors

Three, profit per employee. This should help you define the individual contribution of each worker or manager in your business operations. Therefore, it is advisable to do separate computations for managers, regular workers, casual and temporary workers, and subcontractors. Each computation could give you a good picture of the company’s labor productivity and how to best measure the efficiency of operating the business:

Profit per employee = Gross or net profit per year/No. of regular workers, temporary staff, subcontractors or their managers

Four, employee morale index. This is based on the company’s periodic or annual satisfaction survey. It’s an important tool to define the pulse of each employee and their motivation level. It has a strong connection with labor productivity and gives management an idea of the issues it is facing. To make it a reliable measure, it is suggested that at least 75% of the workers must participate in the anonymous survey:

Employee morale index = (No. of satisfied employees/No. of employee-respondents) x 100%

Five, employee turnover rate. You can make a distinction between those employees who are leaving for greener pastures in other organizations or those who are dismissed involuntarily due to violations of company policy. Involuntary dismissals include retirement, disability, and death. Knowing the turnover rate is connected with the high cost of replacement:

Employee turnover rate = Voluntary or involuntary separations/Total no. of workers in a given period

CORPORATE DASHBOARD
These formulas are not complete. But they are the basic tools that you may need in making a decision whether to offer a retirement program, retrench people, restructure or close the business. Having these formulas is like having a dashboard that tells you if your vehicle is overheating or malfunctioning. All managers must focus on measuring not only the costs of hiring but in determining the satisfaction level at work.

After all, if you can’t afford an above-average pay package in the midst of a difficult situation caused by the pandemic, then you have to make that painful decision. Inevitably, it will boil down to human resource expenditures, which are not an inexact science. But remember, if you decide to swallow the bitter pill now, how will you start again under favorable circumstances?

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