COVID-19 SPECIAL

Coronavirus: Rental waivers, wage subsidies help F&B group stay afloat

Mr Indra Kantono and his wife Gan Guoyi, founders of Jigger & Pony, at the bar's location at Amara Singapore hotel. Mr Kantono says a combination of rental waivers and the Jobs Support Scheme enabled him to retain all local staff without cutting thei
Mr Indra Kantono and his wife Gan Guoyi, founders of Jigger & Pony, at the bar's location at Amara Singapore hotel. Mr Kantono says a combination of rental waivers and the Jobs Support Scheme enabled him to retain all local staff without cutting their basic salaries. ST FILE PHOTO

It has been a year of both highs and lows for Mr Indra Kantono.

Last month, cocktail bar Jigger & Pony, which he co-founded with his wife Gan Guoyi in 2012, clinched the top spot on Asia's 50 Best Bars list for the first time. But the bar remains shuttered, as are four other venues under his food and beverage group.

While most businesses resumed operations on Tuesday, dining in at bars and restaurants is still not allowed.

There were early signs that all was not well, said Mr Kantono. In January, corporate bookings at his restaurants took a hit when the coronavirus outbreak affected business travel to Singapore.

By the time the circuit breaker began on April 7, he was worried about making payroll.

As revenue plunged by 85 per cent, he stopped rostering shifts for all 40 of his casual part-time staff and four full-time staff on work passes. The remaining foreign staff took between 12 and 16 days of unpaid leave in April.

A combination of rental waivers and the Jobs Support Scheme (JSS) enabled him to retain all local staff without cutting their basic salaries.

First announced in February's Budget, the JSS pays out 75 per cent of wages for April and May on the first $4,600 of a local worker's gross monthly pay and at least 25 per cent for a further eight months, depending on the sector. Food and beverage operators can get 50 per cent under the latest enhancements announced last week.

"The fact that the JSS was announced from the get-go for nine months, and progressively calibrated as the situation worsened, was really helpful," said Mr Kantono. "I'm heartened that the Government has thought about this and wants companies to keep their teams strong so they can pledge that when they come back to work, their jobs are secure."

His company will be getting 50 per cent wage subsidies under the JSS from this month, and has committed to no further layoffs due to Covid-19. Starting this month, staff will no longer have to take unpaid leave. Only senior management staff are affected by ongoing pay cuts, with Mr Kantono himself continuing not to draw a salary until the restaurants reopen.

Under the Fortitude Budget, the enhanced JSS will see wage subsidies for all local employees extended to 10 months until August, up from nine.

Cocktail bar Jigger & Pony, which remains shuttered as dining in at bars and restaurants is still not allowed, has turned to offering home deliveries and DIY cocktail kits. PHOTO: JIGGER & PONY

According to the Ministry of Finance, more than 140,000 employers have received over $11 billion in JSS payouts since April, benefiting over 1.9 million workers.

This is part of the $23.5 billion the Government has committed over four Budgets to the scheme.

The pandemic could cause a shift from experience-based consumption, such as overseas travel, to relationship-based consumption, such as ordering gifts for loved ones, said Mr Kantono. "The way restaurants and menus are designed and the way we deliver our hospitality can be calibrated to meet new needs."

Water treatment firm Memiontec also tapped the JSS in a bid to retain its staff.

Its chief executive, Mr Tay Kiat Seng, said none of his 30 local staff took no-pay leave or a pay cut, or had to give up their job despite falling revenue from delayed projects.

In fact, he plans to hire more people in design, engineering and procurement to meet the company's manpower shortage.

The new recruits will come in handy when the company bids for projects and expands its presence in foreign markets such as Indonesia, he said. Memiontec currently carries out essential works under eight service and maintenance contracts with PUB water works, among others.

While the Government helps firms manage costs through schemes such as the JSS, companies and Singaporeans must also make the effort to shore up revenue and spending, said Mr Tay.

"It is companies' job to take action and create more sales. If everyone starts spending money, business will go back to normal quickly."

He added that working from home with the aid of technology during the circuit breaker has improved the company's productivity.

Videoconferencing, for example, has reduced the need for frequent work travel, and video recordings can be shared with colleagues who missed meetings.

"Videoconferencing can do the job pretty well, unless there are more complex activities that require site visits," he said.

"This (circuit breaker) period has been good for changing mindsets and getting ready to resume work after Covid-19."

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A version of this article appeared in the print edition of The Straits Times on June 04, 2020, with the headline Coronavirus: Rental waivers, wage subsidies help F&B group stay afloat. Subscribe