The Silent Impact of Sandy

The disaster that is hitting the East coast in the form of Hurricane Sandy and its subsequent superstorm is unmistakeable.  Thousands are without power, there have been 11 reported deaths in the US alone, and business’s both big and small stand to lose unbelievable revenue.  Add to this, the headaches of the countless numbers of insurance claims that will be pouring in over the next few days and weeks and we may never have a true estimate of what this storm will cost.

Hidden from the intense media coverage of a darkened Times Square there is another cost of this storm, and all other storms for that matter that take employees out of work – that cost is lost wages.  Seems simple to comprehend – if a business isn’t open then employees aren’t working.  I have found, though, that many leaders don’t equate how profound this cost can be.

Many workers live pay check to pay check and have very tight budgets in order to just survive – the reasons for this are many and I’m sure will come up in future blogs – right now, though, I want to focus on the impact of this storm.  There is an anticipation that many shop owners and corporate heads will be closing their doors until the end of the week at the earliest.  That means that the average non-exempt employee will not see pay for almost a week.  For the exempt (or salaried) employee this storm may just equate to a nuisance or, and I believe this will be true, most of them will work from their home computers once power is restored.  For the hourly worker, though, this is often not an option and so they will wait out the storm with increased stress over what their paychecks will look like.  This may mean, that even when power is restored they will not be able to pay for it.

We had a blizzard in Colorado once that closed most companies.  My CEO at the time called me from home upset that he was being advised to close the doors.  He kept thinking about what it would cost in revenue and how that would hurt the bottom line.  True enough.  When I brought up how we would handle hourly folks who would lose a days pay through no fault of their own and suggested that we pay them for a full day, he was completely resistant saying that they should “learn to budget better”.  How hypocritical!  He cared about the loss of money to his business but would not let his employees worry about the loss to their paychecks, a loss that many of them would deeply feel.  When the doors opened two days later, employees desperately asked how the company would handle their lost wages and the CEO said there was nothing that could be done.  We saw a spike of turnover in the next few weeks and when I asked the reason, inevitably the lack of care shown by the CEO was the reason.

Simply put:  When a business closes due to no fault of the employee, that employee should not be punished by a lack of pay.  Yes it will cost the company but that contingency could be budgeted for every year and may not even be used.  For those times when it needs to be used, see how much loyalty taking care of your employees in the face of natural disaster will get you.

Are you listening East Coast?

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