Mass Layoffs: Downsizing Your Organization the Right Way?
Why do companies need to downsize? The reasons for downsizing may vary for each company. Every company can have any one of these reasons to downsize:
Moreover, there are legal issues related to downsizing. Most of the times, downsizing leads to numerous lawsuits which are time consuming and undesirable. Companies can protect their interest while downsizing, only if they follow the proper procedures. Without taking the necessary steps, companies can land up in serious labor disputes and cost them dearly.
HR personnel should undertake the responsibility to maintain all records of employees and update the company on the changes in government rules and guidelines. Ensure that the company is within the framework of the rules designed by the State.
Every employee should be well versed with the company's policy regarding recruitment, transfer, training and even termination. These policies could be provided as a written handbook or an online resource where employees can read the organization's policies and framework.
Companies should stick to the guidelines and not deviate from the stated rules. Also there should be no room for misinterpretation or manipulation of rules.
If the company has to adopt mass layoffs due to economic slowdown, it is best to have documented evidence for reference. Hence, collect bills, invoices, bank statements, and ensure that all records are collectively pointing towards a business downturn. Courts would like to a lot of evidence that conclusively indicate business decline.
Very often companies start the downsizing plan without charting out an effective plan. What use is it to layoff many employees when the end result does not match your expectations? Downsize right; create a logical and practical plan of action. Who do you fire? Why? What are the immediate fallouts? Who is the source of the problem? What is the backup plan? Who can replace the fired executive? How much is the target for saving costs? Also decide in what order do you want to downsize? Do you start downsizing from the bottom or the top?
Finally, don't lose the humane touch of the organization. Downsizing is hard even for your employees. So help them get jobs elsewhere, provide counseling and you can even let them use company premises to continue their job hunt. End the relationship cordially. Who know when you might need to rehire an employee who was downsized?
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