Redundancy - Getting it Right
Consider if you will ... The executive team believes it makes sense to instigate redundancies to reduce costs and mantain efficiencies due to economic challenges and reduced productivity. Initial research indicates significant cost savings and a return to a sensible profit margin if you complete the redundancies as planned. However, you wonder how contentious it could be.
The retained staff won't like what happened to their colleagues and, they will be scared they're next. The local community will be unsupportive of your plight, especially when the unions begin a media scare campaign against you. Your customers will get edgy about reduced customer service levels as soon as they learn of this. And, what will be the best way to implement the actual terminations to ensure there are no malicious actions taken by those made redundant before they leave the premises?
You choose to keep this quiet until the very last minute.
An announcement is then made (at what is deemed the appropriate time) that redundancies are necessary for the organisation to survive and that the smallest number possible will, unfortunately, be let go.
As expected, the employees see it as corporate malfeasance, and your previous good employee relations disappear virtually overnight. Your customers get the vibes from some loose-tongued members of staff and phone to voice their concerns. The local media picks up on the story and gives you a slating, which in turn draws the attention of further customers.
Not quite the way you had hoped it would happen. But what may you have done differently? A few tips:
- Communicate. Make use, as appropriate, of confidentiality clauses to keep people quiet rather than choose not to communicate at all.
- In the view of many staff, a failure to communicate early enough can be seen to be a lack of trust or confidence in them - it's therefore potentially personal and insulting to them. The business reasons for late communications are rarely understood by staff, so don't try to justify it to them.
- Set up a staff representative forum and put a sensible amount of time into building relationships with your staff representatives now whilst things are going well. Then, when times are tough, your staff reps can be consulted at an early stage, thereby removing the need to communicate your plans with all other staff.
- Never expect staff to understand your business reasons for change or redundancy for, even if they do, their priority is to protect themselves and their families and find themselves another job. Instead, focus your energies on understanding their concerns and worries and seek ways to address those at the earliest possible opportunity.
- If necessary, choose a project leader for the redundancy exercise who will complement your management style and ensure that they have solid people and communication skills with good experience of motivation and employee relations.
- Contact us here at Executive Wisdom to be your consulting advisers and support you with this challenge.
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