Managers guide to manage corporate Lay off and downsizing
Lay off of employees..!! Its scary, create insecurities among employees and also leave a bad impression on employees.
Lay off is separation of employees from organization due to economical reason or employees misbehavior or due to shortage of work. Most of the time there is no employees fault.
Being as a HR I have also faced such situation in various organization. Mostly startups took such type of steps but these days in IT companies this practice is quite prevailing.
As a manager/ HR manager you should find other ways to retain those employees who contributed in the companies success. For that Manager should be aware of various things which are as follow-
Compliances- Manager should be aware of all the rules and laws while taking such decision like layoff. So that they can keep transparency and communicate effectively to the employees. For example when Netflix decided to lay of their 15 employees in 2020 due to changes in Marketing strategies they clearly explained to their employees in the meeting and also asked for employees suggestions.
Mode of communication- Manager should prepared how they are going to announce lay off in the organization. what would be the channel of communicating such decisions. Like in case company is laying off front line workers due to replacement of robotic machines they should explained them in such a way that can avoid dispute etc.
Provide Support- Manager or management always should provide required support and assistance to their employees for getting a job, interview skills. During this period situation is very stressful manager should also provide mental health support.
Go for Furloughs- This is a way where employees will not be working on temporary basis but receive their benefits and keep their job titles.
Working hours reduction- Many times when there is not much work companies instead of opting lay off options they go for working hours reduction in this way can create a sense of security among the employees.
Pay cut- Pay cut option is not accepted by employees in general but it is much better option during that period when organization does not generate much revenue. Later employees can bring back on the same payroll when situation is under control. In this way companies can save their employees from anxiety and depression.
Allow voluntary leaves absent- Organizations can choose this option instead of laying of good employees. Employees who are capable of doing this can discuss with the management during this period they won’t be earning but their job will be safe. mostly female employees can go for opting this option and utilize this period in taking care of their family .
staff or job sharing- Instead of hiring new employees manager can distribute the work within existing employees for some period and can save lot of cost .
Executive Compensation reduction- Executives pay reduction can be designed in such a way that on the basis of performance cost can be reduced. Employees continue their work without loosing their job and it will also maintain the cordial relationship between top executives and the organization.
Post pandemic several industries in India, US took decision of laying off their employees between 2022–23, in those list some companies are Amazone-18000, Microsoft-13000, blinkit-1600, Byju’s-4000, Meta-11000, Ford-3580 etc.
It is advisable to be kind and supportive during this period with employees.
Take care of existing employees as it may create fear in other employees, they might feel insecure too and start lookin away from the organization which may impact its brand. Employees should not spread rumors.
