Ask any HR professional about his worst nightmare and the answer would be “layoffs”.
Laying off indeed is one of the most excruciating experiences of a business and its entrepreneurs as well as human resources people.
Newer technologies such as cloud computing, are moving away from a people-led model, which means companies need fewer employees. Organisations have embraced automation tools to perform the mundane, repeatable tasks that were performed by an army of engineers earlier.
Organizational structures are getting disrupted.
“What required 50 programmers, analysts or accountants 5 years ago can be done by a handful of smart thinkers and much smarter systems”.
Poor growth and pressure on profitability have prompted most companies to save on costs. In the year ended March 2017, for the first time since 2009-10, IT companies grew slower than industry body Nasscom’s 8.6% growth forecast, even as the profitability of all the companies declined.
Trump’s protectionist policies mean more Indian IT companies are asking Indian H-1B Visa holders to return home.
All sector’s are witnessing uncertainties. Estimated the layoffs in 2017 are expected to be twice the number of people who were served notice in the previous fiscal year.
Selection for Downsizing
Options available when planning necessary workforce reductions :
-> Seniority-Based Selection - With the seniority-based selection, the “last hired/first fired” concept is used.
-> Employee Status-Based Selection - Employers who have part-time or contingent workers on their payrolls may want to lay off those workers first to ensure greater job security for remaining core workers.
-> Merit-Based Selection - Weeding out poorly performing employees, it should be scrutinized carefully.
-> Skills-Based Selection - To retain those workers who have the most sought-after skills.
-> Multiple Criteria Ranking - Based on multiple criteria such as seniority, skill, and performance considerations.
Employee’s education, experience, promotability and attitude
Employee’s skills, abilities, knowledge, and versatility
Employee’s quantity and quality of work, attendance history and tenure
The question, why lay off employees at all? Few reasons:
1. Cost Cutting - The global economic meltdown has significantly affected business operations. The last decade alone has seen a great number of companies that have filed for bankruptcy. As revenue cannot be increased, the only viable option is to reduce cost.
2. Change in Policies - US President, Donald Trump, has made serious changes in the international trade and business policies of America. These policies focus on job creation within the US.
3. Other Miscellaneous Factors - Reduction in business opportunities leading to termination of projects, companies relocating to more cost-effective locations, Technological prowess is also contributing to the threat of mass retrenchment, Advanced research and development in Robotics making humans redundant.
Coping Up With Layoffs
It is undoubtedly unnerving to realize you have been terminated at a moment’s notice, few tips to bear this crisis are:
1. Develop Alternative Skills - When the ‘dotcom’ era began, many people had to upgrade their skill sets to retain their existing jobs. The current business scenario demands a restructuring of the job and upgrade your skill sets.
2. Look out for different opportunities - Keep an eye out for other opportunities and acquire diverse professional skills.
3. Use your creativity - Many creative professionals have started small startup ventures of their own.
4. Relax and take stock - Sounding trivial, this could be the best time to kick back and relax. Catch up on missed family time and personal space and rethink your career avenues.
Nonetheless, Layoff undoubtedly is the most agonising things to go through for both employees and employers. This is the reason it becomes important for HR people to be organised and agile
This is where EmployWise comes into play! Here’s how our services can help your business sail smoothly through any contingency.
Smooth Exits - Easier to abide by all the exit formalities and requirements, by providing a centralized data hub. Calculating final settlement or rolling out NDAs (non-disclosure) forms and other exit documentations.
Exit Paperwork - Helps your HR stay organized and retain all records and meet all the employment obligations.
Understand that layoffs are not only excruciating for the ones who are being axed, but also for the ones who stay making it a nightmare for the company’s HR department to wade through.