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Australia Post’s bonus U-turn fails to deliver positive sentiment

Australia-Post-van

It has been a monumental year for Australia Post with FY20 group revenue reaching a record $7.5 billion, fuelled by a surge in online shopping due to the pandemic. However, parcel delays and ill will over requests for staff overtime are causing continued headaches for the business.

In recent weeks, the board of Australia Post made the decision to scrap bonus payments for its executive team – expected to be in the region of $7 million – after facing backlash over asking staff to volunteer their time to help the company clear a backlog of deliveries.

Chairman Lucio Di Bartolomeo said in a statement that “no short-term incentive payment would be made to the executive team for financial year 2020” but that he has “every confidence” in their commitment to excellent performance in the year ahead.

An average of 1.57 million parcels were delivered by Australia Post each day in August, with growth in e-commerce a strong driver. But the government-owned business said the pandemic severely impacted its ability to deliver on time.  

In recent weeks, employees in Victoria were sent an email asking if those with a driver’s licence and car were available to pick up parcels and deliver them to customers, a call-out Australia Post said it puts to staff each year in the lead-up to Christmas.

An Australia Post spokesperson said that staff would be compensated for their time and any expenses incurred.

“Our people who help out on the weekend will receive time-in-lieu. We will also reimburse our people for the use of their cars as per our usual mileage and expenses claim process,” the spokesperson said.

With many businesses struggling as a result of the pandemic, more employees are being pushed to their limits. And with fears over job security growing in the current climate, many feel obliged to pitch in where possible.

Over 200 of Australia Post’s Melbourne workers have already put their hand up to help in this instance, the company said, despite the request being highly criticised by onlookers.   

James True, practice leader at LegalVision, told Inside Retail that employees need to be remunerated for any overtime hours worked or the company could face repercussions, such as back payment of wages and penalties for breaches of the Fair Work Act and any applicable modern award.

“Some employers who require employees to work overtime may elect to offer employees time-off-in-lieu (TOIL) of paying them overtime rates. However, any agreement to take TOIL instead of being paid overtime rates needs to be made in accordance with any applicable industrial instrument,” True said.  

“Most modern awards will specify that if an employee requests to be paid for overtime, rather than taking it as time off, the employer would need to pay the employee at the overtime rate that was applicable when the employee worked the overtime hours, for example at weekend overtime rates.”

According to Fair Work, an employer can request that a staff member works “reasonable overtime” so long as a number of considerations are taken into account, the most important being whether there is any risk to health and safety from working the extra hours.

Australia Post told Inside Retail that all employees performing parcel deliveries are covered for personal injury and property damage to themselves or others, and are entitled to worker’s compensation should they be injured while performing their duties.

“Staff assisting with deliveries are required to complete a virtual training session and will be provided with personal protective equipment, including a high-visibility vest, safety boots and masks,” the spokesperson added.

True explained that most insurance policies will cover employees who are travelling in performance of their duties for work, including in the instance that they are using their own vehicle and outside of their typical hours.

“If an employee is directed by their employer to use their personal motor vehicle in order to undertake their employment duties, it is likely that the employer’s insurance policies would extend to this scenario. However, it is important that employers carefully review the terms of their insurance policies to ensure that this is the case,” he said.  

Public perception

While Australia Post may be well within its rights to ask staff to pitch in, the move did little for its image.

Labor’s Communications spokeswoman, Michelle Rowland, tweeted her disapproval of senior management receiving a pay-out at this time.

“Australia Post executives are considering paying themselves millions in bonuses, while simultaneously calling for volunteer delivery drivers,” she wrote.

“Are you kidding me?”

Dr Abas Mirzaei, a senior lecturer in marketing at Macquarie Business School, told Inside Retail that brands put their reputation at risk when their actions and values don’t align.

“One key trigger for the cancel culture is the “out-of-sync” values between the two entities: customers and brands, employees and employers, corporations and shareholders,” Mirzaei said.

However, he said communicating the organisation’s purpose, if there is any, can assure staff that the work they are doing is making an impact.

A survey by Calling Brands found that two-thirds of employees said a higher purpose would motivate them to go the extra mile in their jobs.

“Requests like this require years of practicing purposeful culture, where employees feel more inspired and belonging to the organisation,” said Mirzaei.

But rebranding and revitalising the brand image, which Australia Post did in 2015, isn’t just about changing the logo or tagline.

“Internal practicing of a higher purpose and change of brand culture is required for a sustainable healthy brand that wants to capture employees’ hearts, to go above and beyond and help the organisation,” Mirzaei said.

“Auspost needs to start looking for the source of their purpose inside, to build a stronger emotional connection with employees.”

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