Workforce Management & Planning in Response to COVID-19 - The Edge from the National Association of Landscape Professionals

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Workforce Management & Planning in Response to COVID-19

During the fifth free COVID-19 webinar hosted by NALP, Tom Fochtman, CEO of Ceibass Venture Partners, an investment banking firm, and Bruce Wilson, owner of Bruce Wilson & Company, discussed financial-related questions about the CARES Act and how to keep your company culture strong.

Taking Advantage of the CARES Act

The CARES Act was signed into law on March 27. One part of this law are the Paycheck Protection Program loans (PPP). At this time, the Small Business Administration announced it is no longer accepting applications because the $349 billion for the loans has run out, but lawmakers are negotiating a second round of funding for the program.

The first day PPP was open to submissions was April 3 and there is a regulation that the bank must fund within 10 days of the application being approved.

If a second round of funding becomes available, Fochtman says you want to work with your banker or an SBA expert when applying for this program, as it is constantly changing. However, most of the changes are for the lenders, rather than the recipients.

The application is four pages, with two pages being instructions. It covers a period from Feb. 15 to June 30.

Applicants must have less than 500 employees and the loan is capped at 2.5x prior average 12-month payroll costs. Payroll costs include salary, wages, vacation, sick or other paid leave, health care premiums, retirement benefits, all payroll taxes and payments to independent contractors.

Independent contractor expenses are capped at $100,000 and the total loan cannot exceed $10 million.

“If you use 75 percent of the money to maintain your existing payroll, the loan becomes a grant and this is forgiven,” Fochtman says.

Fochtman says loan forgiveness is taxable but grant forgiveness is not. He says PPP is meant to keep your employees working and to help maintain your payroll, rather than employees going on unemployment.

Fochtman says larger banks are not accepting new non-customers right now because they are so busy with their current ones, but smaller banks are still taking non-clients. He says smaller, more regional banks have been nimbler with the application process.

“If you don’t truly need the money, and you receive the money let it get turned into the grant and forgiven,” Fochtman says. “I’d pay off debt that you have, or I would invest in my business. Do not take it as a windfall distribution to yourself.”

Managing and Adapting Company Culture

Wilson points out that there are huge differences between how landscape industry companies are fairing during this pandemic and it typically varies by the markets and services provided.

He highlights a few of the major success differentiators include communication, culture and re-invention.

Wilson says it’s never too late to start talking to your clients and find out how they’re affected by the virus and what they’re concerned about. He says account managers shouldn’t be trying to sell, but to be a resource at this time. He advises modifying your business to meet customers’ new pain points.

With businesses having to work remotely, it can be a challenge to maintain the company culture, but Wilson says it is essential to continue to work on the culture and take the time to work on your business and not get caught up in the day-to-day.

Owners who take the time to revise budgets and re-assess strategies will be better prepared for the rest of the year and even next year. He says leaders can’t thrive in a reactionary mode. Consider ways technology can allow you to adapt faster and become proactive.

Wilson advises that companies create measurables that can inform them on the effectiveness of employees working from home and to involve teams in planning. Providing virtual opportunities for employees to meet and talk together can keep morale up as well.

Like any other market disruption, Wilson says this provides an opportunity to improve and/or innovate in the workplace. Some of the areas to consider upgrading are your staff by hiring new talent, reshaping your business model and identifying new service lines.

“Customer behaviors are likely to change and what direction is that going to take?” Wilson says. “That’s where it’s really important to talk to your customers and find out what they’re thinking.”  

He also predicts expansion opportunities will be available as certain companies will not want to continue after dealing with this strain. Wilson says marketing is also important to maintain.

If sales are going down, Wilson cautions against arbitrarily cutting jobs in a cost-saving attempt, but rather take advantage of the PPP loan. Making cuts is also an instant morale killer as it can make the rest of your staff stressed about future job cuts.

Jill Odom

Jill Odom is the senior content manager for NALP.