1. Managing Employee Separations, Downsizing, and OutplacementBy
Muhammad Zohaib Sufyan
SZABIST

2. Employee Separation
The termination of employee’s membership in the organization And Turnover Rate is the rate at which employees leave the organization.

3. Cost of Employee Turnover
Recruitment Cost
Advertising, Campus Visits, Recruiter’s time, Head Hunter’s fee
Selection Cost
Interviewing, testing, reference checks and relocation
Training Cost
Orientation, Direct Training, Trainer’s time, Lost productivity during training
Separation Cost
Separation pay, benefits, exit interview, vacant position

4. Benefits of Separation
Reduced labor cost
Replacement of poor performers
Increased innovation
Opportunity for greater diversity

5. Types of Employee Separation
Voluntary Separation
Quits
Retirements
Involuntary Separation
Discharges
Layoffs, downsizing
Rightsizing

6. Managing Early Retirement
When company decides to Downsize
Early Retirement is best option
Package of financial incentives to senior employees opting early retirement
An open window that restricts eligibility to fairly short period of time
Problems
Too many employees taking this option
Wrong employees may leave
Employees may perceive they are forced to leave

7. Managing Layoffs Alternatives to Layoffs Employment Policies Attrition
Hiring Freeze
Cut part time employees
Give Subcontracted work to in-house emp.
Voluntary unpaid time off
Reduced work hours
Change in job design
Transfers & Relocation
Job Sharing
Demotions

8. Managing Layoffs Pay & Benefit Policies Training Pay freeze
Cut overtime pay
Pay cuts
Profit sharing or variable pay
Training
Retraining

9. Implementing Layoffs The criteria for dismissal must be clear based on
Seniority
Employee Performance
Communicating to laid-off employees
Private face to face discussion by Supervisor
Should be done most humanely and sensitively
Supervisor should express appreciation of employees contribution
Don't Break this news during, right before or after vacations or weekends

10. Implementing Layoffs Coordinating Media Relations
Can be very dangerous for
Workforce morale
Customers, suppliers & surrounding community
Careful communication to be done about layoffs to
External Clients (via the media)
Workforce (via internal communication)

11. Implementing Layoffs Maintaining security
Lay off workers can threaten company property
Employee Sabotage could result in substantial damage. (banking & software)
Treatment of laid-off employees with dignity & respect generally reduces the potential for sabotage

12. Implementing layoffs Reassuring survivors of layoff
Low morale and high stress could be made worse if not handled well
Survivor’s Anxiety (Pg. 203)
Keeping Up the Morale (Pg. 203)

13. Outplacement
HR Assistance program to help separated employees deal with the emotional stress of job loss and provide assistance in finding new job
Goals
Reducing the morale problem
Minimize the amount of litigation initiated
Assisting separated employees in finding comparable jobs
Usually a consulting company is engaged for outplacement services

14. I S S U E
After eight years as marketing assistant for Karachi office of Allied Bank, Mr. Shah was told that his job, in a non-revenue-producing department, was being eliminated. His choices: He could either be laid off (with eight months’ severance pay) or stay on and train for the position of credit analyst, a career route he had turned down in the past. Nervous about making mortgage payments for his new Alto, Mr. Shah agreed to stay, but after six months of feeling miserable in his new position, he quit. Was his separation from bank Voluntary or Involuntary? Can you think of situations in which a voluntary separation is really an involuntary?

15. If off-the-job stress and dissatisfaction begin to create on-the-job problems, what are the rights and responsibilities of a Human Resource Manager in helping the employee to overcome these problems? Are intrusions into such areas an invasion of privacy, a benevolent and altruistic* employer practice, or simply prudent financial step taken to protect the firms investment?
I S S UE
*When one thinks for other’s benefit

16. Thank You