Employers today are facing some of their most difficult decisions when it comes to one of their most important asset: their employees, writes Elliot Dinkin in this month's EBN. Layoffs, salary and retirement plan freezes, pay cuts, health care benefit reductions - nothing is off the table in this recession as companies look to cut costs.
Clearly one who feels your pain, Dinkin outlines a five-point plan to developing a long-term total comp strategy to help you take a fist to the recession. For more on rethinking total comp, read this month's EBN cover story, "No stone unturned."
Showing posts with label layoffs. Show all posts
Showing posts with label layoffs. Show all posts
Wednesday, May 13, 2009
Thursday, May 7, 2009
Tip of the Day: 'Freak case' offers tips on how to conduct layoffs without litigation
A cover report in this month's EBN details the case of Claire Cole, whom the Massachusetts Supreme Court recently ruled should have received full disability benefits after she suffered a heart attack within an hour of learning she would be laid off due to budget cuts in March 2000.
Although the majority of legal experts in the labor and benefits field regarded the situation as a "freak case," as Alden Bianchi, of the Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. firm in Massachusetts puts it, experts do expect a rise in workplace litigation, concerning both termination and benefits, stemming from radial layoffs. Therefore, complying with the ever-changing legislative landscape is imperative if employers hope to make it through what promises to be challenging legal times.
Read the article for advice from our legal eagles on conducting layoffs without litigation.
Although the majority of legal experts in the labor and benefits field regarded the situation as a "freak case," as Alden Bianchi, of the Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. firm in Massachusetts puts it, experts do expect a rise in workplace litigation, concerning both termination and benefits, stemming from radial layoffs. Therefore, complying with the ever-changing legislative landscape is imperative if employers hope to make it through what promises to be challenging legal times.
Read the article for advice from our legal eagles on conducting layoffs without litigation.
Tuesday, May 5, 2009
Tip of the Day: During layoffs, remember FMLA compliance
Even though FMLA and making reductions in staff are complicated enough on their own, putting the two together can create an even bigger headache for employers. However, staying on top of FMLA compliance during layoffs is essential to preventing liability and lawsuits.
“The most important thing is going to be documentation,” says Tarun Metha, a labor and employment attorney with Bryan Cave LLP, told Associate Editor Kathleen Koster in a report for BenefitNews.com. When employers consider layoffs, including workers who are on FMLA leave, they should make sure that they carefully review the files of workers out on FMLA leave.
“Ask yourself ‘if this went to a judge or jury, would it be convincing or does this look like an ad hoc compilation?’” Mehta explains.
“If it’s a large reduction in force, you sometimes let go employees who don’t have any performance problems. [In this case,] you’d want to document how you came to that number. You want to look at your statistics and make sure you’re not laying off everybody on FMLA leave or everybody of a certain age group,” says Mehta.
Discrimination on severance packages can also occur when dealing with workers on FMLA leave. Mehta recommends calculating the amount of severance on objective factors, such as seniority or the department’s performance. He also explains that employers should base the package on the past six months of performance, as those on leave will have less data to contribute. The decision should be pro-rated or should stem from a different calculation.
In addition, while employers can give a larger severance to an employee because he or she is on leave, they cannot do the reverse, Mehta notes. “You can, however, offer them less if this decision is based on documented merit, though few employers elect to do this, as it can be difficult to prove who is owed what in a larger layoff.”
Making measured decisions and documenting an employees’ progress before they go on leave is strongly advised to combat the severe risks associated with unlawfully firing an employee already on leave.
“[Right now] you see a combination of layoffs and desperation…and so the likelihood of increased litigation is almost guaranteed,” says Mehta. Finally, employers should also be familiar with state laws concerning FMLA leave as more often than not these regulations are stricter than the federal baseline.
Related EBN coverage:
House Dems introduce new paid-leave bill
“The most important thing is going to be documentation,” says Tarun Metha, a labor and employment attorney with Bryan Cave LLP, told Associate Editor Kathleen Koster in a report for BenefitNews.com. When employers consider layoffs, including workers who are on FMLA leave, they should make sure that they carefully review the files of workers out on FMLA leave.
“Ask yourself ‘if this went to a judge or jury, would it be convincing or does this look like an ad hoc compilation?’” Mehta explains.
“If it’s a large reduction in force, you sometimes let go employees who don’t have any performance problems. [In this case,] you’d want to document how you came to that number. You want to look at your statistics and make sure you’re not laying off everybody on FMLA leave or everybody of a certain age group,” says Mehta.
Discrimination on severance packages can also occur when dealing with workers on FMLA leave. Mehta recommends calculating the amount of severance on objective factors, such as seniority or the department’s performance. He also explains that employers should base the package on the past six months of performance, as those on leave will have less data to contribute. The decision should be pro-rated or should stem from a different calculation.
In addition, while employers can give a larger severance to an employee because he or she is on leave, they cannot do the reverse, Mehta notes. “You can, however, offer them less if this decision is based on documented merit, though few employers elect to do this, as it can be difficult to prove who is owed what in a larger layoff.”
Making measured decisions and documenting an employees’ progress before they go on leave is strongly advised to combat the severe risks associated with unlawfully firing an employee already on leave.
“[Right now] you see a combination of layoffs and desperation…and so the likelihood of increased litigation is almost guaranteed,” says Mehta. Finally, employers should also be familiar with state laws concerning FMLA leave as more often than not these regulations are stricter than the federal baseline.
Related EBN coverage:
House Dems introduce new paid-leave bill
Monday, May 4, 2009
Tip of the Day: Before you conduct layoffs, read this
A new survey from Work+Life Fit, Inc. finds 94% of full-time employees are willing to save jobs by changing or reducing their schedule, or taking a pay cut.
In addition:
* 60% would take additional unpaid vacation days or furloughs.
* 48% would share their jobs with colleagues.
* 47% would take a cut in both pay and hours
* Just under a third would take a month or more unpaid sabbatical.
"Layoffs will always be a possibility. [However], it's not an all or nothing choice -- flexibility or layoffs," says Cali Williams Yost, CEO, Work+Life Fit, Inc. "Hopefully CEOs and others planning job cuts will learn that a 5% layoff can sometimes cost more than a 5% pay cut. All options need to be considered."
In addition:
* 60% would take additional unpaid vacation days or furloughs.
* 48% would share their jobs with colleagues.
* 47% would take a cut in both pay and hours
* Just under a third would take a month or more unpaid sabbatical.
"Layoffs will always be a possibility. [However], it's not an all or nothing choice -- flexibility or layoffs," says Cali Williams Yost, CEO, Work+Life Fit, Inc. "Hopefully CEOs and others planning job cuts will learn that a 5% layoff can sometimes cost more than a 5% pay cut. All options need to be considered."
Thursday, April 30, 2009
Tip of the Day: Legal considerations for furloughs
I received this week from Mercer citing alternatives to layoffs, furloughs and suspending 401(k) matches, while still cutting costs. About halfway through, I saw this nugget:
"...furloughs may prompt scrutiny from the Department of Labor since U.S. labor laws prevent employers from requiring salaried employees to reduce the number of weekly hours worked like they can do with hourly employees."
You may already know that, but it was news to me. And even if you knew, it never hurts to be reminded, right?
At any rate, Mercer also offered some alternative approaches to traditional cost-cutting measures without harming your employment brand or diminishing your resources of talent:
"These solutions involve cutting pay in exchange for enhanced paid-time-off banks and offering leaves of absence in monthly increments at reduced pay levels. Instituted as either a voluntary or involuntary measure, these alternative approaches cut workforces in the short-term while maintaining employment of critical talent over the long-term. The benefits are numerous – availability of essential employees once business improves, option to restore salaries and paid time-off to original levels, strong employee morale and additional cost-savings by not having to rehire workers."
"...furloughs may prompt scrutiny from the Department of Labor since U.S. labor laws prevent employers from requiring salaried employees to reduce the number of weekly hours worked like they can do with hourly employees."
You may already know that, but it was news to me. And even if you knew, it never hurts to be reminded, right?
At any rate, Mercer also offered some alternative approaches to traditional cost-cutting measures without harming your employment brand or diminishing your resources of talent:
"These solutions involve cutting pay in exchange for enhanced paid-time-off banks and offering leaves of absence in monthly increments at reduced pay levels. Instituted as either a voluntary or involuntary measure, these alternative approaches cut workforces in the short-term while maintaining employment of critical talent over the long-term. The benefits are numerous – availability of essential employees once business improves, option to restore salaries and paid time-off to original levels, strong employee morale and additional cost-savings by not having to rehire workers."
Wednesday, April 29, 2009
Overheard @: Sabbaticals may help prevent layoffs
This sounded like potato po-tah-to to me, but in an exclusive to BenefitNews.com, the folks from yourSABBATICAL make their case for not only why an unpaid sabbatical isn't a euphemism for layoff, but also why implementing a sabbatical program could help employers prevent conducting actual layoffs.
Read the report here, and let me know. Are sabbaticals and furloughs softer terms for layoffs?
Read the report here, and let me know. Are sabbaticals and furloughs softer terms for layoffs?
Wednesday, April 1, 2009
Overheard @: Outplacement benefits become latest sign of the times
Clearly, no employer wants to layoff valued, hardworking staff, but the recession has left many companies with little choice. However, I hear that some employers are doing their best to take the sting out of such action by offering outplacement services.
According to reporting from Workforce Management, a survey from outplacement firm Lee Hecht Harrison that finds the top reason companies use outplacement is to maintain positive relationships with employees.
Such goodwill doesn't come cheap. WM reports that outplacement offerings -- ranging from web-based services to in-person coaching -- can cost anywhere up to tens of thousands of dollars per employee. Too much to pay in these recessive times? Perhaps. But EBN reporting finds that even making small overtures to your former employees can help bring them back into the fold, especially if you never wanted to lose them in the first place.
What do you think? Would/has your company considered adding outplacement services to its benefits slate? What is the potential ROI? Comment and let me know.
According to reporting from Workforce Management, a survey from outplacement firm Lee Hecht Harrison that finds the top reason companies use outplacement is to maintain positive relationships with employees.
Such goodwill doesn't come cheap. WM reports that outplacement offerings -- ranging from web-based services to in-person coaching -- can cost anywhere up to tens of thousands of dollars per employee. Too much to pay in these recessive times? Perhaps. But EBN reporting finds that even making small overtures to your former employees can help bring them back into the fold, especially if you never wanted to lose them in the first place.
What do you think? Would/has your company considered adding outplacement services to its benefits slate? What is the potential ROI? Comment and let me know.
Wednesday, March 11, 2009
Tip of the Day: Effective communication through layoffs in three stages
Although survey results show employers forecast that “the pace of layoffs may be slowing from the staggering highs of the last few months, ... there will certainly be more to come,” admits Kathryn Yates, global director of communication consulting at Watson Wyatt. “While employers continue to make difficult cost-cutting decisions, they can still take important steps to keep remaining workers engaged and productive on the job.”
Watson Wyatt suggests three stages of communications efforts for employers before, during and following layoffs:
Before
Prepare leaders early. Leaders should initially deliver key messages about business conditions and actions, and frontline managers should personalize and reinforce them.
During
Clearly communicate the rationale for layoffs, and don’t shy away from tough questions. Transparency is critical to maintaining trust. Employees leaving the organization will want to know what support the company will provide them and hear that their service has been valued. Employees remaining will want to know whether their own jobs are secure. Messages to both groups should remain consistent.
After
Engage remaining employees by communicating a vision for the future. Highly engaged employees are more resilient during times of change and will drive performance in critical times. Deliver messages about the organization’s long-term vision, clarify how employees can contribute to it and set up realistic expectations for sharing information and offering support going forward.
EBN recently spent "Five Minutes With ..." Yates for our podcast series. Download the audio here.
Watson Wyatt suggests three stages of communications efforts for employers before, during and following layoffs:
Before
Prepare leaders early. Leaders should initially deliver key messages about business conditions and actions, and frontline managers should personalize and reinforce them.
During
Clearly communicate the rationale for layoffs, and don’t shy away from tough questions. Transparency is critical to maintaining trust. Employees leaving the organization will want to know what support the company will provide them and hear that their service has been valued. Employees remaining will want to know whether their own jobs are secure. Messages to both groups should remain consistent.
After
Engage remaining employees by communicating a vision for the future. Highly engaged employees are more resilient during times of change and will drive performance in critical times. Deliver messages about the organization’s long-term vision, clarify how employees can contribute to it and set up realistic expectations for sharing information and offering support going forward.
EBN recently spent "Five Minutes With ..." Yates for our podcast series. Download the audio here.
Wednesday, March 4, 2009
Tip of the Day: Be careful mixing job, benefits terminations
When it comes to terminating benefits along with jobs, employers must take care to remember the two may not mix -- at least in the eyes of the legal system.
The Massachusetts Supreme Court held last week that Claire Cole, a former secretary for the department of public works in Salem, Mass., should have received full disability benefits after she suffered a heart attack within an hour of hearing she would lose her job in March 2000.
Cole, who died of a separate illness in 2006, previously claimed that past years of job-related stress, in addition to hearing that her position would be eliminated due to budget concerns, caused the attack, leaving her unable to do her job and thereby deserving full disability benefits. The Contributory Retirement Appeal Board later found that the debilitating heart attack was job-related, a finding that was upheld by the Massachusetts Supreme Court.
The two key questions the court answered in the Retirement Board of Salem vs. Contributory Retirement Appeal Board were whether Cole’s heart attack occurred “as a result of and while in the performance of her duties” and whether or not the city is liable for the damages despite conducting a routine management practice.
Countering Cole’s assertions, the Salem Contributory Retirement Board argued that Cole had pre-existing conditions of hypertension and chronic anxiety.
Whether or not these types of claims will become a trend in coming months as more and more workers are expected to be laid off is hard to say. But according to one Salem attorney, this was a highly specialized case.
“If you’re talking about situations where people are being notified that their jobs are being eliminated and they have a reaction to that, if that reaction is purely mental or psychological, they will not recover [benefits],” Alan Pierce told Salem News. “If the reaction is physical, they will recover. But how frequently will someone have a heart attack or stroke upon receiving bad news?”
Is this a legitimate ruling or should her qualification for disability benefits have ended with her job’s imminent termination? Let us know what you think. --Kathleen Koster
The Massachusetts Supreme Court held last week that Claire Cole, a former secretary for the department of public works in Salem, Mass., should have received full disability benefits after she suffered a heart attack within an hour of hearing she would lose her job in March 2000.
Cole, who died of a separate illness in 2006, previously claimed that past years of job-related stress, in addition to hearing that her position would be eliminated due to budget concerns, caused the attack, leaving her unable to do her job and thereby deserving full disability benefits. The Contributory Retirement Appeal Board later found that the debilitating heart attack was job-related, a finding that was upheld by the Massachusetts Supreme Court.
The two key questions the court answered in the Retirement Board of Salem vs. Contributory Retirement Appeal Board were whether Cole’s heart attack occurred “as a result of and while in the performance of her duties” and whether or not the city is liable for the damages despite conducting a routine management practice.
Countering Cole’s assertions, the Salem Contributory Retirement Board argued that Cole had pre-existing conditions of hypertension and chronic anxiety.
Whether or not these types of claims will become a trend in coming months as more and more workers are expected to be laid off is hard to say. But according to one Salem attorney, this was a highly specialized case.
“If you’re talking about situations where people are being notified that their jobs are being eliminated and they have a reaction to that, if that reaction is purely mental or psychological, they will not recover [benefits],” Alan Pierce told Salem News. “If the reaction is physical, they will recover. But how frequently will someone have a heart attack or stroke upon receiving bad news?”
Is this a legitimate ruling or should her qualification for disability benefits have ended with her job’s imminent termination? Let us know what you think. --Kathleen Koster
Tuesday, March 3, 2009
Overheard @: Psst! Beware -- disgruntled employees can 'Telonu'
Wrapped with a bow, ready-made for the "technology-as-a-curse" files is a new site and application from Telonu Inc. that, by the company's own description, allows current and former employees to "rave, rant and rate your workplace and the people there."
The firm's latest additions are its Layoff Tracker Widget and Layoff Talk site to help people keep pace with the job market and stay on top of the latest pink slip announcements amid the recession. The widget lets anyone display as-it-happens layoff announcements on their personal Web site or blog. For each announcement, the Layoff Tracker displays the company, date of announcement and number of affected jobs (Get it? Telonu = tell on you).
No, you're not having a nightmare. And unfortunately it gets worse. Users then can visit Telonu’s Layoff Talk site, where they can read more details about a specific layoff, check out what others in the community have posted and leave their own anonymous posting.
Although far from ideal for employers, Telonu is another sign of the times, as layoffs have become a large part of today’s work culture. Stats from the Bureau of Labor Statistics show that since the start of the recession in 2007, the total number of unemployment claims jumped to 2,394,434.
What do you think of Telonu? Useful tool or literally a sounding board for disgruntled current and ex-workers? Comment and let me know.
The firm's latest additions are its Layoff Tracker Widget and Layoff Talk site to help people keep pace with the job market and stay on top of the latest pink slip announcements amid the recession. The widget lets anyone display as-it-happens layoff announcements on their personal Web site or blog. For each announcement, the Layoff Tracker displays the company, date of announcement and number of affected jobs (Get it? Telonu = tell on you).
No, you're not having a nightmare. And unfortunately it gets worse. Users then can visit Telonu’s Layoff Talk site, where they can read more details about a specific layoff, check out what others in the community have posted and leave their own anonymous posting.
Although far from ideal for employers, Telonu is another sign of the times, as layoffs have become a large part of today’s work culture. Stats from the Bureau of Labor Statistics show that since the start of the recession in 2007, the total number of unemployment claims jumped to 2,394,434.
What do you think of Telonu? Useful tool or literally a sounding board for disgruntled current and ex-workers? Comment and let me know.
Monday, March 2, 2009
News You Can Use: Employers offer good news, bad news on the recession
The bad news is, employers see the current recession lasting a while. The good news is, they also seem to think the worst of layoff and other cuts is past.
New survey data from Watson Wyatt shows 61% of employers expect the current downturn to last at least until the end of 2009. However, the firm reports that most companies already have made most of the sweeping changes they intend to.
“Companies have come to terms with the fact that this recession is going to last and that they can’t slash their way out of it,” says Laura Sejen, global director of strategic rewards consulting at Watson Wyatt. “With over half of companies reporting they have already made layoffs, they are now focusing on smaller, more sustainable cost-cutting actions.”
According to the survey of 245 large U.S. employers conducted in February, 52% have made layoffs, up from 39% two months ago. Additionally, 56% now have a hiring freeze in effect, an increase from 47% in December’s survey.
However, the number of companies planning layoffs has fallen from 23% to 13%. “This may be good news," notes Laurie Bienstock, Watson senior compensation consultant, "as companies move more towards cost-cutting efforts other than workforce reductions in an effort to hold on to the workers they will need when recovery eventually comes.”
Workers won't be untouched by those other cost-cutting efforts, though. Among them are:
* Salary freezes, 42% (up from 13%).
* Reductions in 401(k) matches, 12% (up from 3%).
* A shortened workweek, 13% (up from 2%).
* Travel restrictions, 69% (up from 48%).
What do you think? In terms of layoffs, is the worst over? What alternative cost-cutting measures are you considering in lieu of/in addition to salary reductions? Comment and let me know.
New survey data from Watson Wyatt shows 61% of employers expect the current downturn to last at least until the end of 2009. However, the firm reports that most companies already have made most of the sweeping changes they intend to.
“Companies have come to terms with the fact that this recession is going to last and that they can’t slash their way out of it,” says Laura Sejen, global director of strategic rewards consulting at Watson Wyatt. “With over half of companies reporting they have already made layoffs, they are now focusing on smaller, more sustainable cost-cutting actions.”
According to the survey of 245 large U.S. employers conducted in February, 52% have made layoffs, up from 39% two months ago. Additionally, 56% now have a hiring freeze in effect, an increase from 47% in December’s survey.
However, the number of companies planning layoffs has fallen from 23% to 13%. “This may be good news," notes Laurie Bienstock, Watson senior compensation consultant, "as companies move more towards cost-cutting efforts other than workforce reductions in an effort to hold on to the workers they will need when recovery eventually comes.”
Workers won't be untouched by those other cost-cutting efforts, though. Among them are:
* Salary freezes, 42% (up from 13%).
* Reductions in 401(k) matches, 12% (up from 3%).
* A shortened workweek, 13% (up from 2%).
* Travel restrictions, 69% (up from 48%).
What do you think? In terms of layoffs, is the worst over? What alternative cost-cutting measures are you considering in lieu of/in addition to salary reductions? Comment and let me know.
Thursday, February 12, 2009
News You Can Use: Workers fear losing retirement savings
Employees aren't immune to the news reports of millions of Americans losing trillions of dollars in collective retirement income, and the news that increasing numbers of organizations are freezing their retirement plans, suspending matching contributions or both is heightening anxiety about their futures.
A new survey by Workplace Options finds that 59% of employees are concerned that money from their pensions and 401(k)s won't be there when they need it.
Dean Debnam, Workplace Options CEO says the worry causes a vicious cycle, as layoffs beget financial worries that decrease job performance and put employees in the line of fire for layoffs. "This, coupled with financial worries, can spell disaster for a worker's emotional and physical wellbeing, as well as overall productivity."
Even if your company is suspended its matching contributions -- which I strongly advise against -- or otherwise making retirement plan cutbacks, be sure to communicate with employees in a way that doesn't send them into a tailspin. Click here to listen to our podcast with communications expert Dennis Ackley and read the accompanying article, “Softening the blow of bad benefits news,” in the February EBN.
A new survey by Workplace Options finds that 59% of employees are concerned that money from their pensions and 401(k)s won't be there when they need it.
Dean Debnam, Workplace Options CEO says the worry causes a vicious cycle, as layoffs beget financial worries that decrease job performance and put employees in the line of fire for layoffs. "This, coupled with financial worries, can spell disaster for a worker's emotional and physical wellbeing, as well as overall productivity."
Even if your company is suspended its matching contributions -- which I strongly advise against -- or otherwise making retirement plan cutbacks, be sure to communicate with employees in a way that doesn't send them into a tailspin. Click here to listen to our podcast with communications expert Dennis Ackley and read the accompanying article, “Softening the blow of bad benefits news,” in the February EBN.
Wednesday, February 11, 2009
Tip of the Day: RIF on the side of caution -- conduct layoff audits
It's a sign of the times when an entire series of nondiscrimination tests is created to help employers prevent disparities when conducting layoffs ... sigh.
But so it goes. The big-thought thinkers at the Center for Forensic Economic Studies, have developed a series of pre-layoff Chi-square and T tests that analyze employer data to zero in on statistically significant disparities. Employers contemplating reductions in force (RIFs) can avoid or minimize exposure to discrimination claims through these pre-RIF statistical audits.
Audits begin with the same type of statistical review plaintiffs would perform in seeking to make out a prima facie case of discrimination. Using files commonly kept by employers, the RIF plan is tested for possible disparate impact on protected classes.
If such disparities exist, further analyses can be conducted to explain the disparities. Click here to find more information on the audit process and CFES.
But so it goes. The big-thought thinkers at the Center for Forensic Economic Studies, have developed a series of pre-layoff Chi-square and T tests that analyze employer data to zero in on statistically significant disparities. Employers contemplating reductions in force (RIFs) can avoid or minimize exposure to discrimination claims through these pre-RIF statistical audits.
Audits begin with the same type of statistical review plaintiffs would perform in seeking to make out a prima facie case of discrimination. Using files commonly kept by employers, the RIF plan is tested for possible disparate impact on protected classes.
If such disparities exist, further analyses can be conducted to explain the disparities. Click here to find more information on the audit process and CFES.
Friday, December 12, 2008
Tip of the Day
Manage your information security risks.
In addition to just being good business practice, securing employment information could be even more important in the current economic environment. A recent survey by Cyber-Ark Software finds that more than half of U.S. respondents (58%) confessed to stealing corporate data and would use the information as leverage to land a new job if they were laid off.
And although customer data was highest on the list of the juiciest info to steal (52%), HR information also ranked highly (28%).
To help HR/benefit pros safeguard company data, IRHIM offers a course on managing information security risks.
In addition to just being good business practice, securing employment information could be even more important in the current economic environment. A recent survey by Cyber-Ark Software finds that more than half of U.S. respondents (58%) confessed to stealing corporate data and would use the information as leverage to land a new job if they were laid off.
And although customer data was highest on the list of the juiciest info to steal (52%), HR information also ranked highly (28%).
To help HR/benefit pros safeguard company data, IRHIM offers a course on managing information security risks.
Tuesday, December 2, 2008
Tip of the Day: How to fire an employee
Small or large, almost all businesses are feeling the pinch in this economic downturn. If your company is forced to lay off employees, it is critical that proper channels are followed to avoid potentially costly backlash in the future.
This SMB Human Resources Web Exclusive offers must-read tips on how to fire or layoff employees quickly and with a minimum of legal hassle.
This SMB Human Resources Web Exclusive offers must-read tips on how to fire or layoff employees quickly and with a minimum of legal hassle.
Wednesday, November 19, 2008
Scone: Protecting the blind side
I’m a big football fan, and one of the things I hate the most is seeing a quarterback get hit on the blind side (the opposite of his throwing arm) because there’s nothing worse than a hit you don’t see coming.
Along those lines, I received an e-mail last week from a recently laid off employee. Lamenting the loss of her job, she asked if I could help her find information on how to recoup the nearly $400 she’d deferred into a commuter benefits account but had to forfeit upon her termination.
I double checked with a benefits attorney, then gave her the tough news that yes, the funds forfeited to employer, as she was no longer with the company. I felt bad for her, having been completely blindsided by the layoff and then it seemed getting insult piled onto injury by losing funds she probably could sorely use right now.
It got me and a few EBN colleagues thinking. Obviously, employers must comply with WARN (Workers Adjustment Retraining and Notification Act), which requires employers with 100 or more workers to provide employees, bargaining representatives and local government officials with 60 days advanced written notice of a mass layoff or a plant closing.
But more specifically, can/should employers communicate far in advance to employees about the benefits they lose (commuter benefits, FSA funds) and the ones they can take with them (retirement savings, HSA funds) if they are laid off? How far in advance? And does such notice make a company appear unstable or give away that layoffs are being considered?
Is giving them the information and tools to protect their money more valuable than causing some uneasiness about whether they might be the one to get a pink slip? An article in an upcoming issue of EBN will address these questions and others, but I’d like to hear your thoughts.
Meanwhile, communication expert Hugh Braithwaite, president of Braithwaite Communications, offers the following tips in communicating effectively during a layoff:
* Be complete. If there are holes in the facts of your story, employees will fill-in-the blanks with what they believe the facts should be. That’s how rumors get started.
* Be consistent. If you tell a different story every time you tell it, information will become muddled and there will be mass confusion. That’s how rumors spread.
* Inform affected employees first. This should be common sense, but employees being laid off should hear the news first and in person if possible. Respect and compassion are essential. Prepare an “exit kit” for each laid-off worker that contains an official letter, hand-outs with frequently asked questions, confidential agreements, references, contact sheet, and severance and benefit information. Be as thorough and complete as possible –remember, the more comprehensive you are, the less you are leaving to the imagination.
* Inform retained employees. Review the situation, be prepared to answer questions, and provide resources for follow-up questions and concerns. Depending on the size of the layoff, a series of regular employee communication sessions may be necessary instill confidence and maintain a sense of community.
Along those lines, I received an e-mail last week from a recently laid off employee. Lamenting the loss of her job, she asked if I could help her find information on how to recoup the nearly $400 she’d deferred into a commuter benefits account but had to forfeit upon her termination.
I double checked with a benefits attorney, then gave her the tough news that yes, the funds forfeited to employer, as she was no longer with the company. I felt bad for her, having been completely blindsided by the layoff and then it seemed getting insult piled onto injury by losing funds she probably could sorely use right now.
It got me and a few EBN colleagues thinking. Obviously, employers must comply with WARN (Workers Adjustment Retraining and Notification Act), which requires employers with 100 or more workers to provide employees, bargaining representatives and local government officials with 60 days advanced written notice of a mass layoff or a plant closing.
But more specifically, can/should employers communicate far in advance to employees about the benefits they lose (commuter benefits, FSA funds) and the ones they can take with them (retirement savings, HSA funds) if they are laid off? How far in advance? And does such notice make a company appear unstable or give away that layoffs are being considered?
Is giving them the information and tools to protect their money more valuable than causing some uneasiness about whether they might be the one to get a pink slip? An article in an upcoming issue of EBN will address these questions and others, but I’d like to hear your thoughts.
Meanwhile, communication expert Hugh Braithwaite, president of Braithwaite Communications, offers the following tips in communicating effectively during a layoff:
* Be complete. If there are holes in the facts of your story, employees will fill-in-the blanks with what they believe the facts should be. That’s how rumors get started.
* Be consistent. If you tell a different story every time you tell it, information will become muddled and there will be mass confusion. That’s how rumors spread.
* Inform affected employees first. This should be common sense, but employees being laid off should hear the news first and in person if possible. Respect and compassion are essential. Prepare an “exit kit” for each laid-off worker that contains an official letter, hand-outs with frequently asked questions, confidential agreements, references, contact sheet, and severance and benefit information. Be as thorough and complete as possible –remember, the more comprehensive you are, the less you are leaving to the imagination.
* Inform retained employees. Review the situation, be prepared to answer questions, and provide resources for follow-up questions and concerns. Depending on the size of the layoff, a series of regular employee communication sessions may be necessary instill confidence and maintain a sense of community.
Subscribe to:
Posts (Atom)
Posts
