After the crisis, the reckoning

How businesses treat their employees during the Covid-19 crisis will lead to a reckoning – a very bitter one if times get hard. A famous poster, headlined “What did you do in the war daddy?”, was designed to shame men into volunteering for the army during world war one. It could be adapted in our time for bosses- “When the pandemic struck, how did you look after your workers?”

We will learn who the good guys and the bad guys are at some point in the next couple of years (or even right now - given the speed of social media at outing the cloth-eared or arrogant). Personal reputations and brands will be destroyed or enhanced.

In the 2008 crash, RBS was nationalised by the UK government because it was about to go bust – with horrible consequences for personal finances. CEO Fred Godwin, poster boy of red in tooth and claw acquisitive capitalism, changed status from captain of the universe to vilified pariah in just a few days. Looking back on 2008, remarkably few people lost their reputations, but that was because we found it difficult to work out who the guilty people were (such are the opaque complexities of modern big finance).

This time it will be different. We can all see that Spurs (for example) have decided to furlough their back room staff whilst paying in full the wages of their multi-millionaire players.

Media are different – 12 years on from the crash of 2008, social media is even more widely used and the bad guys will be outed quickly. Gary Lineker, a prolific tweeter, has pointed out how grotesque the Spurs decision looks.

The unpredictable factor is how bad things will get over the next months.

Many workers are only one pay check (or freelance fee) away from debt – because over the past decade or more wages have stagnated. Now they have nothing to fall back on, and without funds the consequence will be widespread poverty and desperation that conjures up images of 1920s great depression. The atmosphere could get very bitter indeed.

This crisis will produce many more Fred Goodwins. And good guys too – Eddie Howe, manager of Bournemouth, was the first manager to offer to take a pay cut. His fast and generous action will stand him in good stead.

But it is already clear that the likes of Daniel Levy (of Spurs) and Mike Ashley (of Newcastle FC) think that they are immune from public backlash. They will, I believe, be proved wrong. Let’s hope so.

This piece first appeared on Julian's blog here.