What you should know about compensation amid the pandemic
Toronto-based SpringLaw is, in many ways, pandemic-proof because it has been completely remote since its inception in 2017. And because it specializes in workplace issues for employers and executives, the COVID-19 crisis and related restrictions have yielded a myriad of questions and concerns from clients facing previously unfathomable scenarios.
SpringLaw founder Lisa Stam describes the last few months as a whirlwind of activity for her team of lawyers and legal experts who live across Ontario and Manitoba.
Stam finds herself providing legal advice to companies that were forced to make the switch to allow employees to work from home. Changes to compensation is a topic that comes up. “We started to hear rumblings from companies and clients about this,” she said in a phone interview.
In Switzerland for example, the Supreme Court ruled last year that employers are required to contribute to employees’ rent payments if they are expected to work from home. There is no equivalent ruling in Canada.
Stam says that most reputable employers will pay to set employees up to work from home comfortably. But beyond extra cash for an ergonomic chair and perhaps better internet, some employers are wondering if pay can be trimmed.
“We’ve heard of the opposite of the Swiss example where if employees get to work from home, companies ask if they get to pay them less. If an employer tries to do that it would probably be a clear constructive dismissal," she said, referring to the obligation for employers to provide affected workers with compensation, usually in the form of severance. "You can’t just start lowering people’s salaries even though you’re expecting them to do the same job just because they don’t have to commute in.”
Starting a new job working from home
When it comes to new employees starting out in a work-from-home environment though, companies aren’t bound by the same rules and can offer lower salaries and pay.
Koula Vasilopoulos is the district president of Robert Half, an international staffing firm, and she says the pandemic has convinced many firms to embrace fully remote roles. That means companies looking to trim staffing costs can offer less pay to prospective workers who live outside urban centres where the cost of living is higher.
“What we are seeing, which is a little bit different, is we might have a client in Vancouver looking for a fully remote role and they now have the ability to look at a pool of candidates in a much broader market. So for example, they can try to recruit from Winnipeg or Regina,” she said in a phone interview. “Typically they were just looking in markets in which they were located.”
The war for talent
Vasilopoulos says she hasn’t seen big shifts in compensation yet because these are “early days.” But she warns against employers lowballing compensation because the labour market remains tight in many of the industries she serves. Robert Half specializes in accounting, finance, IT, legal, digital and consulting roles.
“I urge employers to remember that there’s still a war for talent,” she said. “Your company may assume that because it’s remote they can pay less but other companies might not assume that and that leaves your employees open to being poached.”
Vasilopoulos also warns against the creation of a two-tiered workplace where workers who are in the office are paid more than their remote counterparts, which can create problems.
“That’s a really slippery slope and companies are going to have to be very cautious because if people feel underpaid, or unfairly compensated for the roles that they’re doing, you end up with employees who become disengaged. It can lead to low morale and even though they may not be physically sitting next to their co-workers, they’re talking about it,” she said.
Rather than slashing salaries, Vasilopoulos sees reducing the amount of office space as a more strategic way to cut workplace costs, including by utilizing shared workspaces and trimming down common areas such as kitchens.
Reducing office space means employees will need a certain amount of space to do their work from home. According to Stam, some industries including legal, medical, financial and therapeutic require a home office that is soundproof and enclosed to ensure client confidentiality. She says that can pose problems for hiring managers during the interview and screening process.
“One area that employers need to be super careful about is asking discriminatory questions that are going to be offside with the Human Rights Code. You can’t ask someone if they have a big home and then not hire them because their home isn’t big enough,” said Stam. “Or family, status like asking people if they have lots of kids at home, or if they have a nanny because you only want to hire people who have a nanny. But you can ask if they have a space that you can work at in your home. It’s a really tricky line.”
From a prospective employee’s perspective though, letting the hiring manager know about your set-up can help land you the job.
“If you know that you have a really great space and a dedicated office and you know that you’ve got everything sorted out with childcare, talk about that. The employer can’t ask about that, but it’s a selling feature,” said Stam. If you have months of experience working from home under your belt, she suggests mentioning that as well. “Experience is having done it before,” Stam said.
These new scenarios present a lot of opportunity for employers and workers, according to Vasilopoulos, who saw a surge of job postings starting at the end of May. Major challenges she sees on the horizon include a second wave and problems with safely reopening schools and childcare centres.
“It’s a really big deal. If schools are not reopened I think we’ll see people needing to continue to be remote. Many organizations have been quite successful to turn to that quite quickly,” Vasilopoulos said. “I think it’s a really exciting time to be in business to be a part of this evolution of what the traditional office will look like.”