The federal government has announced an extended work-sharing program intended to help embattled oil and gas employers weather the storm.
Eligible employers can now benefit from an additional 38 weeks of employment insurance (EI) benefits for employees, for a maximum of 76 weeks. Employers that use the federal work-sharing program have workers’ wages supplemented by EI benefits for the days they are not working.
The extension is expected to benefit as many as 33,000 additional workers. As of April, there were 347 active work-sharing agreements with Alberta companies, according to the government.
A work-sharing arrangement is a critical tool during tough economic times that allows employers to hold on to skilled workers, according to MaryAnn Mihychuk, federal minister of employment, workforce development and labour.
“Work-sharing is good for workers and for businesses. It means fewer layoffs and more certainty for employees, and it helps businesses get through difficult times. Keeping our commitment to doubling work-sharing agreements (is) part of our plan to help the middle class in Alberta and across Canada,” she said.
Hold on to talent
In the oil and gas sector, the federal work-sharing program has taken off, said Janet Salopek, president of Salopek & Associates in Calgary.
“Definitely, employers are leveraging that program, particularly if they’ve got a shop or trades or things like that where you’ve got work units.”
It allows employers to maintain a skilled workforce, said Cissy Pau, principal consultant at Clear HR Consulting in Vancouver.
“Rather than having to lay off everybody, you can reduce the number of layoffs, everybody works a reduced number of hours, so that when everything turns around, you still have those employees, those skilled workers,” she said.
“That’s certainly the biggest benefit is allowing you to reduce the number of full layoffs you have to do and retain your skilled workers.”
Employers should look at any alternatives to layoffs during difficult times, said Salopek.
“Even before they go the work- sharing route, we really encourage our clients to look at who their key performers are and… if there’s anyone on the team who’s not performing, you let them go. So what you’re actually doing then is getting your workforce down to a core that you want to keep, you want to keep engaged, and you really want to work with.”
As employers start cutting costs and cutting staff, the risk is that they also start cutting into the industry advantage of experience and know-how, said Colin Dunne, senior principal at Korn Ferry Hay Group in Calgary.
“They could be really cutting into the competitive advantage that they have, which is the knowledge and know-how of their people.”
Playing the long game
It’s generally been the more progressive, long-sighted companies taking the route of work share, said Jessica Culo, owner of Express Employment Professionals in Edmonton.
“We’ve definitely seen a lot of companies pursuing this route. It kind of seems like the choices have been ‘We’re going to lay off or we’re going to go to work share.’ And I think that work share is a really, really good solution — that’s a little bit more outside of the box — when companies are thinking about retention still,” she said.
Not all companies want to talk about retention right now — it’s not necessarily a priority, said Culo.
“But I see some more progressive companies that do and they realize that things will change, and they’re going to need to find a way to hang on to their best employees. And for those that have really good teams and really good core staff that they want to keep happy, I think it’s a way to demonstrate loyalty to them in the hope that they’ll return that same sentiment when the market does change again.”
It wasn’t that long ago that everyone in the oil and gas sector was scrambling to hang on to people, she said. The winds will eventually change, and employers may find themselves in that position once again.
“(And) the other thing that’s kind of interesting, and this is a study that we just put out, found that 41 per cent of business leaders said there are key positions they’re not getting enough applicants for — even in a down market. And it could be that maybe their expectations are skewed, or there’s a skills gap — there could be a bunch of reasons,” said Culo.
“But I think that also promotes the idea of work share when there isn’t enough work going around, because they know that a difficult skill set or one where you need to combine certain soft skills with certain technical requirements, those people are hard to find. And if you find them, you should hang on to them.”
However, work share is not a cure-all and it may not be a solution for every employer, said Salopek. There are potential barriers and challenges that may come into play.
“If employers want to do the work share program through Service Canada, it’s a bit of a process, and they have to get all employees in the work unit to agree to it. So that might be a road block. Not everybody might put up their hand and say that’s good for them,” she said.
“They’ve got to put in their application, they’ve got to put it in a month before they actually start the program, and it is a bit of a process.”
Employers may have also decided other strategies are aligned better with their business plan, said Salopek.
“So that may just not work for them, and that may not be an alignment of where they want to go, so they may look at other strategies as opposed to the work sharing. So they may find there’s other ways to manage.”
Voluntary sabbaticals, taking the summer off or voluntarily reducing hours are other options employers could examine, she said.
“(It’s about) looking and talking to people about what works well for individuals.”
There’s also the fact that not every job can realistically be shared, said Pau.
“What you need to be clear on is if you traditionally have one job and it’s one person doing that job, and now you’re sharing it between two people, the communication between those two people has to be really good — knowing where one person’s job starts and the other person’s job ends is really important. And it’s not always easy to do that,” she said. “Just delineating those responsibilities can become a challenge.”
Not every occupation lends itself to different people doing it, said Dunne.
“It’s just not viable (sometimes). That can often be overcome with a little bit of planning,” he said. “The biggest barrier is often the people — are they the type of people and have they got the skill set to be able to do the smooth hand-off and make it work?” she said.
“Companies that have done some good work on talent management and they really know their people have an advantage because they can pick out which ones have the knowledge and the ability to be able to work in that type of environment — which is very different because not only do you have to do the job, but you also have to co-operate and collaborate.”
Employer brand, reputational risk
One important aspect of offering work-sharing arrangements is the boost it can provide to an employer brand — when employers demonstrate they are doing everything possible to avoid layoffs, that can go a long way with employees, said Culo.
“The more progressive companies are the ones that think about employment branding,” she said.
“So many companies have invested so much over the past seven or eight years… now they’ve invested so much into the person, they’re already got the character fit, they’ve got that unique combination that fits their culture. It’s a huge thing to walk away from.”
More people are really appreciative of that, said Culo.
“We’re interviewing candidates and maybe they have been laid off, but they can see that the company invested a lot of effort up to that point, and it really was a last resort.”
This kind of program demonstrates a company really does care about its people — they’re not just expendable, said Pau.
“If it’s done properly, it demonstrates a certain level of caring and concern for your staff. It acknowledges that ‘We know that times are tough, but rather than cutting you completely, we’re going to still try to maintain your employment,’” she said.
“How you treat employees when times are tough is a truer sign of a company’s character than when times are really good and you’re flush with money… when times are tough, how a company reacts and how they treat their staff is a true sign of their character.”
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