Propose three (3) ways that a manager can cope with any negative emotions that may accompany an employee layoff.
Outplacement services are an important way that helps both the manager and the employees in coping with negative emotions resulting from layoffs. This involves using professionals to assist employees who have been laid off in dealing with the trauma. According to (Noe et al 2012),outplacement services are better provided by an outside firm (pg 276). This is because they are professionals in that area and providing such services is their core business unlike the manager. The manager can develop negative emotions during layoffs as he had developed a working relationship with his employees unlike the outside firm. The employees can harbor resentments towards the manager and the company they have been working for but not so with the outside firm.
The manager will better cope with the negative emotions if he knows that the displaced employees are receiving professional help in securing new jobs in other organizations. According to (Noe et al 2012),outplacement services will help displaced employees evaluate their skills and knowledge base that may be required by other organizations (pg 276).They may also offer assistance on how to secure and pass in interviews. Through psychological counseling employees will be assisted in dealing with hatred, anger, grief and anxiety. The manager can ensure that the employees receive their compensation or severance package from the company in accordance with the terms of the agreement.
The manager will be able to cope with negative emotions if he is able to conduct successful and effective dismissal meetings with the employees. The manager will be at peace knowing that he did the best in making the separation between the employees and the organization as smooth as possible.
Describe a step-by-step process of conducting the dismissal meeting
The dismissal meeting should be face –to-face and scheduled to take place early in the week.
The manager should ensure that the security personnel are aware of the dismissal meeting and are willing to offer any help needed when dealing with dismissed employees.
The manager in charge of the meeting should get a third person to be present in the room as a witness, when he is dismissing the employee.
When everybody is seated, the manager should be straight forward when passing the information that the employee's employment is being terminated.
The manager should also convey information concerning severance compensation such as any terms that need to be agreed on before the dismissed employee can receive it.
The manager should be brief and not offer any lengthy explanations.
The manager should then give time to the employee who is being dismissed and listen to him express himself.
The manger should not argue with the employee or go into lengthy discussions of why the company had acted that way.
The manager should then present the dismissed employee with a written copy as a summary of the meeting. The summary should include information on how to return company property and equipment.
The dismissed employee can be escorted out of the organization by security personnel if they turn violent, make threatening statements or have a history of such behavior. It is also important that employees who were formally dealing with highly sensitive information be escorted so that they do not retaliate on the company.
Determine the compensation that the fictitious company may provide to the separated employee.
The employee is legally entitled to receive a reasonable notice about the termination of his job. The company may provide termination pay, if they did not provide enough displacement notice to the employee. There is a standard notice period set by state or federal legislation, however the notice period is also the company and job specific. The notice period is given to provide the employee with sufficient time to search for a job and enable him to transition smoothly to the new employment.
The termination pay should sufficiently compensate the employee in his job search. Factors considered when calculating the pay include the age of the employee, as it will determine how easy or challenging it will be to get re-employed. Also considered is the length of time that the employee has offered services to the organization, if he served for long, he can be rewarded with a longer notice period. Also considered is the nature and the seniority of the position the employee held, rare skills or senior positions may limit re-employment opportunities. When the employee is not given proper notice, then he is entitled to a termination pay.
The company can also offer compensation in the form of Severance pay to the displaced employee. According to (Noe 2012) this payment will be paid when the job termination is permanent, thus no future relations between the employee and the employer (pg 277). Severance pay is meant to compensate the employee for the length of service to the organization and also for the position they held. There is no set standard for the severance pay, however it should be paid in compliance with state and federal guidelines. The company can calculate and compile the total amount of all compensation they will offer the employee before they make the decision on how to release it.
Using Microsoft Word or an equivalent such as Open Office, create a chart that depicts the timeline of the disbursement of the compensation.
A line graph of time in months against percentage compensation.
The graph shows that by the end of the week following termination, the employee will receive 40% of the calculated total compensation
The end of the first month will see the employee get another 30% followed 20% for the next month.
The payments will be completed on the third month when the employee gets 10% which completes the 100% compensation payment.
Predict three (3) ways that this layoff may affect the company
The morale of the employees who remain will be negatively affected after one of their own is laid off. All humans are social beings and always search for a sense of belonging. They seek to establish bonds with groups and tribes, humans take it further by being able to create bonds with organizations and nations. The drive to bond works depending on the emotions the employees have towards the organization. When they feel proud about the organization they will be more involved and improve performance so as to support the organization reach its objectives. When they feel betrayed by the organization they will be laid back and have to be pushed to get things done. According to (Cascio 2010), when employees feel like the organization does not value them it leads to loss of morale, dissatisfaction and increased employee turnover(pg 3). Bonds created between fellow workers and in departments serves as a source of motivation, when one of them is laid off these bonds are broken.
According to (Nohria et al 2010), the morale of the employees who remain is also affected when the employees are not sure about their job security (pg 1). Employees in the organization where an employee was recently displaced will not have a sense of security and will not be confident about their jobs. They will be in constant fear and can even have resentment towards the organization. The fear of the unknown causes employees to resist changes that are seen as having potential to bring any unpleasant experiences. Time that employees would have spent coming up with new ideas and creative innovations, will be spent worrying about their job security and how long it will be before they are laid off too.
According to Cascio (2010), the layoff may have a negative effect on the reputation of the company (pg 3). The perception that potential employees and even current employees hold of the company being a good employer can be changed. This is especially so if the employee is dissatisfied with the dismissal or the compensation and decides to file a lawsuit. The general image of the organization can be tainted, especially where the company is found to be at fault. Potential employees with skills and important knowledge will be weary when applying for a job in the organization as job security will be a concern. The standing of the organization in the society may be affected by the layoff.
Layoffs affect the company as it may incur both direct and indirect costs. The company can lose suppliers, distributors, customers and clients who were conducting business with the organization through the displaced employee. The loyalty of some clients and customers is based on their contact with the organization, this is especially so if the employee was key in initiating the client to do business with the organization. The company will also incur costs in case they have to settle lawsuits filed against them by employees who were displaced. A layoff may cause other employees to leave the organization rather than wait for their turn.
Indirect costs will be incurred by the organization when they want to fill the vacant position. The processes of sourcing, recruiting and induction of new employees are costly. Although the new employee may bring new ideas on board, they may need on the job training to make them more adapted to work on the specific job they are filling. The company may incur costs in conducting activities such as advertising and social responsibility activities in an effort to save their damaged reputation. In some cases the opportunity cost of training an employee is lower than that of displacing him and hiring a new one and inducting them. This is based on the length of time the position will be vacant and the impact the layoff will have on other employees.
- Noe, R., Hollenbeck, J., Gerhart, B. , Wright, P. (2012). Human Resource Management: Gaining a Competitive Advantage. (8th Ed.).Boston: McGraw-Hill/lrwin.
- Nohria, N., Groysberg, B., & Lee, L.E. (2010). Employee motivation. A powerful new model. Harvard Business Review.
- Cascio, W., (2010). Employment Downsizing and Its Alternatives. Retrieved on January 25 2014 from http://www.rightmanagement.ca.