At some stage the lurgy could get into the simulator or staff in the building. This could result in a general shut down.
With exemptions to periodic checking already granted by CASA, it should not matter if we go several months with no simulator checks. The few pilots not laid off will remain proficient simply by flying regularly.
A problem with a training backlog will only occur for pilots laid off then recalled 6-12 months from now. The airlines will just have to suck it up and plan it.