Empty restaurants and retail stores were one of the first signs of the devastating impact the coronavirus on Australian business.
Within a few months, the virus, now called COVID-19, has gone from being a largely unknown medical condition to one that threatens to impair Australian and global economic growth.
We explore the impact on business and the importance of planning for setbacks beyond your control.
Whether it is the coronavirus, fire or flood, the fact is if you are in business long enough you will almost certainly have to deal with an external impact on your business – bushfires, drought, GFC, SARS, 9/11, we've seen a few. The key is to react but not overreact.
Law firm Clayton Utz recently shut down their Sydney office amid concerns that a team member had been exposed to the virus by his wife, whose grandmother was one of Australia's three deaths attributed to the virus. The wife was subsequently tested for the virus and cleared within 24 hours, enabling the office to resume operations. If the results were positive however, it might have meant a 14 day quarantine for the approximately 600 staff and potentially any other person they had come into contact with. Vodafone's head office and two Perth stores, and Cisco in Perth also closed temporarily after staff who had recently returned from overseas showed flu like symptoms.
Protecting your employees and customers from the risk of infection is essential. Businesses should asses the risk of transmission and put the appropriate protocols in place. It could be as simple as distributing the Health Department's guidance and reviewing insurances for staff required to travel.
Individuals who have travelled to countries with travel restrictions (China, South Korea, Italy) in the last 14 days, or have direct contact to a confirmed case of coronavirus must self-isolate and should not attend work.
Fair Work Australia notes that, "The Fair Work Act does not have specific rules for these kinds of situations so employees and employers need to come to their own arrangement." If an employee is impacted and needs to be isolated, and cannot work from home effectively, then the time will generally be taken as paid or unpaid leave.
Managing the health costs of diagnosing and treating coronavirus is estimated to cost $1 billion. This cost is being met 50-50 by the states and territories and the federal Government. This support will cover health services in public hospitals, primary care, aged care and community health expenditure, such as health related activities in childcare centres.
The Treasurer has also flagged the imminent release of a stimulus package to protect the economy including an investment allowance, a small business package and potentially some form of payment through the social welfare system.
The impact of COVID-19
As of 8 March 2020:
Australia has 74 reported cases of the virus (22 have recovered) and three deaths, 18 of those cases had not travelled overseas. The Prime Minister has announced the activation of the Australian Health Sector Emergency Response Plan for Novel Coronavirus (COVID-19).
COVID-19 does not transmit as efficiently as influenza but causes more severe disease – 3.6% of COVID-19 cases have died, by comparison, seasonal flu generally kills far fewer than 1% of those infected. Unlike the flu, COVID-19 can be contained.
WHO states there is a severe and increasing disruption to the global supply of personal protective equipment – caused by rising demand, hoarding and misuse. Prices of surgical masks have increased six-fold, N95 respirators have more than tripled, and gowns cost twice as much. Market manipulation is widespread. Globally, it is estimated that Pandemic Supply Chain Network supplies need to be increased by 40 per cent.
The Reserve Bank of Australia states that the coronavirus outbreak overseas is having a significant effect on the Australian economy, particularly in the education and travel sectors.
Travel restrictions
Travel restrictions or increased advice levels are in place for a number of countries.
Travel restrictions are in place for China, Iran, and South Korea. Australian citizens and permanent residents are advised not to travel to these countries. Foreign nationals cannot enter Australia within 14 days of leaving these countries. Australians returning from these countries must self-isolate for 14 days.