A new class of business is emerging in Australia: The Non-Essential Essentials.
There are hundreds of thousands across Australia, in cities and in country towns; these are the businesses that haven’t been explicitly closed down by Government edict, but neither are they essential enough to be earning any actual money.
While customers make daily and frenzied forays to supermarkets, pharmacies and — of late — bottle shops, the bookshops and jewellers and dentists and physios stand empty.
Depleted of trade, loaded up with commercial rent obligations and — usually — a full complement of staff who have mouths to feed and some reasonable questions about why they’re all at work, when everyone they know is shouting at them to stay home.
Some of them have done their best to obey Government advice, but found themselves wrong-footed.
“We saw the press conference where Daniel Andrews said all non-essential businesses need to close by Monday,” says Matt Barbetti, who with his fiance runs D&M Traders, a homewares store in the rural Victorian town of Ballan.
“We went ahead and did that. But there are all these other shops still open in Ballan.”
Barbetti is fortunate — their landlord has been in contact to confirm she would suspend their rent — but most businesses are not so lucky.
Without a formal Government directive to shut down, most commercial leases gallop on regardless of lessees’ prevailing economic conditions.
‘We’re not really selling anything’
Chris Holdsworth’s family has operated Holdsworth Bros Jewellers — which currently operates two shops in Melbourne shopping centres — for four generations.
“Shopping centres are considered essential services, so we’ve been open through stage 2; we’re staying open, though, of course, we’re not really selling anything,” he says.
No one would argue — least of all Holdsworth — that the company’s jewellery offerings are a genuine necessity at a time of global crisis.
But in the absence of a directive to close, the Holdsworths navigate uncertain waters both in terms of their lease and their 13 employees.
“Being forced to close is preferable to choosing to close because of a downturn,” Chris Holdsworth says.
“There will be an end to the crisis. The family business has been operating for 136 years; our forebears managed to get it through world wars and the Depression. We’ll survive.”
But a Government-mandated closure would “at least bring certainty”.
“Then the Fair Work Act does allow you to stand down your staff if you want to. Now, that’s not our intention but at least having that safety net, knowing that you do have that course of action means that you’re not breaking employment law. It’s just about having certainty.”
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Businesses have to triage for themselves
Employment lawyer Josh Bornstein said his was a fast-moving area at present, with the Fair Work Commission ordering variations to awards and to industrial agreements to allow for the extraordinary events currently on foot.
“But if a business is shut down as a result of Government direction, then it’s pretty difficult to resist the idea that it’s appropriate to stand down its employees.”
When asked at his late-night press conference on Tuesday to define an “essential worker,” the Prime Minister’s response was extraordinarily broad: “Anyone with a job”.
His political motivation was clear: For a man whose task it is to hold people together in a crisis, this was not the time to start telling people they’re dispensable.
In the absence of a definition from on high, businesses are having to triage themselves.
Amie Redman is a self-employed physiotherapist running a mobile service in Nambucca Heads on the mid-north coast of NSW.
She watched the Prime Minister’s press conference on Tuesday night and was immediately struck by the fact that her practice was deemed essential while massage services were ordered to close.
“In my private practice setting, there’s a pretty high degree of close contact,” she says. “I don’t think the virus can tell the difference.”
Redman made her own decision to move immediately to a telehealth model, out of caution for her clients.
“I am a bit surprised that there hasn’t been a clear directive from the Government and it’s up to the individual,” she says.
“It makes me a bit nervous … wherever there’s money involved, there’s potential for the right thing not to be done.”
Trusting your instincts
For the Non-Essential Essentials, the absence of Government directives has left a lot of latitude around decisions with a significant public health impact.
David Gaunt owns Gleebooks, a popular Sydney bookstore with several business premises and about 25 staff.
Like many Non-Essential Essentials, Gaunt is balancing public health outcomes against his concern for staff and their livelihoods.
“Our understanding is that the COVID-19 compensation for employees commences on April 27,” he says.
“This is a major factor for me in wanting to stay open to ensure that as many as possible of our staff can have their salary through to that point.
“The smaller the business, the more likely it is that they’re not in a position to say ‘You can all draw on your entitlements’.
“I’m comfortable insofar as in small business, you’re always having to make a lot of decisions, all the time, based on your instincts.
“But I’m not happy having to justify ‘Is it safe?’ to my employees when I have absolutely no qualifications.”
Childcare centres struggling
An especially hard-hit sector is childcare — particularly the smaller providers.
The Government has asked childcare centres to remain open so that other essential workers can keep going. They are an essential service.
But the other Government message — stay home if you can — is decimating numbers at many centres, with parents pulling their children out entirely.
Natasha O’Sullivan is the owner and director of Our Place Playschool, a 25-place early childcare centre in Port Stephens in NSW.
“We’ve been instructed to stay open but we’re losing numbers and we’re losing viability,” she says.
“If we don’t have the numbers, or I can’t get the staff to come in and work, then if I’m forced to go to our regulatory department and say we can’t stay open, then we don’t get any assistance from the Government.”
In the past week, six families have pulled their children out — the equivalent of 16 places at the centre.
Where Wednesday and Thursday last week brought 19 and 25 children respectively to the centre, Wednesday and Thursday this week brought only 8 and 9.
O’Sullivan says it’s a waiting game for smaller operators.
“They’re trying to hold on as long as they can for the Government to close us. I feel like we’ll be in that situation as well.”
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Nesha O’Neill, vice president of the Australian Childcare Alliance, said 87 per cent of childcare providers had either one or two centres.
“This is going to send a lot of businesses to the wall,” she says.
“And then when the economy comes out of hibernation, they’re not going to be there.”
O’Neill says the biggest difference the Government could make would be to repurpose childcare subsidies to keep workers employed for the duration of the crisis.
“Either we have 200,000 workers turning up at Centrelink tomorrow, or we can redirect that funding to flow through centres to staff who stay motivated and stay connected to the families,” she said.