“I work for a small business with about a hundred employees. The business owner is smart, nice, and friendly but delays payments of monthly salaries. When I joined the company seven months ago, I was shocked that I had to work for over six weeks at a stretch before receiving my first pay. I resumed work on the first of August, so the delay was not due to an off-payment cycle but a company policy. The worst bit, I was not informed of this, and no one talked about it. After completing my first month here with no pay, I asked some colleagues about the delay but only got referred to HR for a response.
“When I approached HR to discuss this, I was informed of the official payday as the fifteenth of the new month. Aside from the fact that it was disappointing, I had a structured monthly financial commitment with a reasonable repayment date that I almost defaulted on. However, I eventually adjusted but uncomfortable. Even though I forgot to ask HR if the December payment would be an exception to the rule, I was hopeful there would be a slight change just for the festive period.
By November, things took a different turn as we got no pay for the next two months. I never believed I could work for that long without pay let alone remaining dedicated. I found out that the reasons for this were that I loved my job and enjoyed performing my role in the organization. The business processes and mechanisms are solid, and I understand them end-to-end. Also, the company has some good employee benefits like a child education fund to augment school fees, family health insurance, and a pension.
In one of your articles, I recall stating that changing an organizational culture can start with anyone, not necessarily the business owner. In this case, I wish for a change and would like to be the change agent because I believe some policies in my company are hurting it more than helping it. For example, because of the funny salary policy, some employees have detected some loopholes that they take advantage of to get by before payday.
Lastly, about a year ago, our boss relocated to another country, so he only keeps in touch virtually and on the phone. His absence has created a void that is yet to be filled by a capable staff member. What can be done to put my company back on the right path?”
The above was an excerpt from a workplace scenario email received recently. Mz. Rukky (real name concealed) would like me to advise what she can do about the whole situation. Even though there are so many areas to touch on, I’ll be focusing on steps to take to avoid unnecessary delays of salary payments which cover cost, finance, recruitment, and management.
We all know that we are in interesting times, and sadly, businesses are feeling the heat. Aside from the current harsh realities, many business owners do this for other reasons like reducing staff turnover and mitigating against theft, damages, or losses. This company has a history of deliberately holding salaries as a form of staff retention tool, making it somewhat unjustifiable. Regardless of the reason(s) behind the move, there are many counter reasons why a company shouldn’t do it as apparent in this case study. What makes it unwise includes staff’s financial well-being, bad personal and company reputation, organizational health, and religious standpoint. So, let’s dive right into ways Mz. Rukky can help her organization get back on track.
Audit the business processes – Since Rukky understands the business dynamics and processes very well, she can start helping by auditing them to remove duplicated roles and merge functions. The number of duplicate functions that will to be found after the exercise will amaze you. Many businesses in Nigeria pile on staff that would be productive for half of the hours they are at work. Optimization is key and an audit will reveal or justify it. This exercise will also indicate the number of employees required to handle each task and how cross-function roles can be achieved without compromising quality and control. Once she gets a hang of this, it will be obvious to the management, the necessary steps to take to cut costs and meet their financial obligations. The organization may be better off having fifty employees with two thousand combined productive hours a week than a hundred staff members giving aggregate per week.
Do not hire whom you cannot fire – Sometimes, relationships or compassion make us hire people we don’t need in our organizations. The warning signs are usually there from the start but because it’s more of a favour to an aunt, uncle, friend, or someone you owe a favour to, we fall into this trap. Please note that there is nothing wrong with hiring people you know or who get referred to you. If there is a suitable role for them and they can do the job or are willing to learn, hire away. However, when they are not interested in your business, hence, just marking time at your establishment, the relationship will turn sour, fester, and extend to the introducer. This is why laid-down hiring protocols should always be followed even if there would be exceptions thereafter. Also, attach the candidate to a superior who will coach, guide, and watch his/her growth. Ask for evaluation every three months to ensure things are working. If not, address the issue immediately or look for another organization where the person will add value. Teaching people how to fish instead of giving them fish is understandable. However, one needs to be sure they want to learn fishing in the first place. For all its worth, they might be interested in something completely different, and employing such individuals all in the bid to help will be counterproductive. It is better to link them with an employer in their industry of interest. Mz. Rukky’s company may need to do this to save itself, even though, we often advise people should be laid off in the most humane way possible after exploring other options.
Budget salaries based on income – Many small businesses sometimes poach employees to have access to their clients or customers without doing the math. Whether an individual can move some customers from their former workplace to you or not should never be the sole reason for that hire. Experience has shown such people have absolutely nothing to offer. There was a case a few years ago where Business B suddenly opened the same business on the same street as an existing Business A. As if that was not bad enough, Business B poached almost half of Business A’s staff for her new place. She also made the poached staff send bulk SMS to all Business A’s clients to inform them of where they were now working. Many of these clients went there but refused to visit again. They were the ones who came back to Business A to tell the stories of their encounters. Business B did not survive a year before it got taken over. Moreover, there are systematic ways of estimating the value and impact of an employee’s work even if you cannot easily quantify them in monetary terms.
Truly earn your pay – Another genuine way to cut unnecessary costs is by ensuring the business owners earn their salaries. Because you own a business does not mean you are entitled to remuneration if you do not work there. At best, you can take allowances and wait for profit sharing. It might be a hard sell to management, but our deep dive revealed it to be one of the reasons the business is currently having liquidity problems.
Support your core staff with interns – After streamlining the processes and workforce, there might be some gaps here and there. Those gaps do not necessarily mean you should start hiring again. Instead, recruit interns who will work and learn at a fraction of the cost of full-time employees. It will then be your choice to retain hardworking ones as permanent staff. The upside to this is fantastic because these interns get opportunities to build their careers through such experiences if they truly commit to the work. They also have the liberty to leave for other interests they are more passionate about at the end of the programme.
Prioritize value and goal alignment – Value and goal alignments are so essential that their absence is enough to disrupt the whole system. It is possible to have conflicting goals at the onset simply because there are certain things you will be unaware of and never experience from the outside. However, from onboarding to the next ninety days in the role, an employee would know if he or she belonged there. To avoid concluding on compatibility in haste, the new intake should adopt or devise ways to align personal goals/values with the corporate ones. Mz. Rukky may want to organize a goal and value alignment training session for all employees to sensitize everyone about its importance to both parties and to improve employee engagement.
Pay every two weeks – If your company has liquidity issues or some strange payment cycles based on your client-service agreements, you can adopt this salary payment method to ease the heavy monthly punch. Instead of making your new employees wait six weeks before getting paid, they may be paid half their salary at the end of the first month. The remaining half will become due by mid of the new month. This idea may be a win-win strategy if they are well-informed before the first salary is due. With this payment method, they will not be cash-strapped or have any justification to steal from the organization. Your company would also have the much-needed time for payment clearance.
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We changed the name of the sender of this case study for confidentiality purposes. Please note we are still accepting emails on workplace scenarios as case studies. Kindly send them to [email protected].
Opaleye, a well-being specialist and corporate wellness strategist, writes from Lagos
