|
|
This is only a preview of the paper
Click here to register and get the full text.
Existing members click here to login
|
|
|
... At ABC Corporation there is need for a change in corporate structure and complete refocus toward the aggressive efficiency inspired by new thinking. ...
To implement this new agenda the corporation must purge the necessary personnel through a reduction in force. ABC Corporation feels that the needed reduction will be 10% of all salaried staff personnel worldwide. Within this reduction the corporation will give all staff the option of resigning or retiring their position with a bonus of 2 weeks pay for every year of service. ... If the needed personnel do not accept the RIF then the corporation will explain to these individuals that all redundant positions will need to be eliminated and if the corporation does not attain the required 10% it will be forced to layoff any positions necessary to meet its goal. The personnel that are required to be in the layoff will receive only the minimum two weeks severance package that is standard for the corporation.
Legal issues
There are a few legal issues that need to be looked at in this reduction in force. The first is the fact that ABC Corporation is purposely targeting the older staff and is at least on the highest levels openly expressing the desire to cut out all necessary older staff to meet its 10% goal in reduction in force. The one fact that the corporation has on its side in dealing with this issue is that they are openly offering a generous RIF package to all of the staff and not just the older workers. ... The best protection for the corporation would be if while it is doing the RIF it should reorganize its divisions and consolidate as many parts of the company as possible. ... This in turn would allow for the ability to trim out any older executives or managers that did not take the generous severance package the corporation offered. ... In one way it is wrong to force out your older workers and replace them with younger and possibly cheaper personnel. Many of these workers have in the past contributed to the profitability and abilities of the corporation. They have been good and in many cases loyal staff members who thought the advancement of the corporation was paramount in their lives. These people on occasion gave much of their free time and some gave their entire lives to the greatness of the corporation. ... If you would ask this question to the people that are about to go through the reduction in force; the overwhelming response would be, yes. These people would not enjoy the prospect of being unemployed but they would want the corporation to keep going, growing, and building. ... This is why the corporation has in this case decided to do its best with regards to compensation of these formerly necessary staff members. ...
Considerations in making the decision
Employers, particularly those embarking on a reduction in force, can take a number of steps to minimize their vulnerability. ...
Since ABC Corporation must face this challenge of a reduction in force, it must be carefully planned and executed to minimize the risks of incurring additional liability in the form of employee lawsuits. ...
Alternatives to Layoffs may reduce the Risk of Claims
Although ABC Corporation is capable of realizing short-term savings through a RIF, large layoffs can cause this company to incur hidden costs. ...
Therefore, before planning a reduction in force, ABC Corporation’s management team should consider whether other options are available, including:
• hiring freezes;
• wage freezes;
• postponement of wage increases;
• reducing fringe benefits,
• including employee sharing of insurance premiums,
• increased insurance deductibles and limited benefit eligibility for newer employees;
• work furloughs;
• reducing work hours with proportionate pay cuts;
• assessing expected job attrition;
• allowing affected employees to transfer to other vacant positions within the organization;
• job sharing;
• terminating employees with substantial performance problems;
• terminating recent hires within their introductory periods; and
• discontinuing the use of temporary and part-time employees and redistributing their work.
Another option for this corporation is to look at early retirement programs or ask for volunteers by offering enhanced severance benefits. ... Explaining the corporation’s financial position can enlist employee support rather than resentment. ...
When Layoffs are Unavoidable, Proper Planning may Reduce Risk of Employment Disputes
Since the determination was made that a reduction is necessary, the task generally falls to the corporation’s operations, human resources, and legal counsel to devise a plan which minimizes the risks of litigation. To be effective, a reduction in force requires advance planning. ... Identifying the goals of the staff reduction, in terms of labor costs to be eliminated and/or the number of employees by which the organization is overstaffed. ... Determining whether a de facto severance pay plan already exists for employees involuntarily terminated; such plans may require compliance with ERISA reporting requirements and may already bind the corporation to provide the benefit to all affected employees.
s. ... Not using age as a distinction in early retirement benefits provided as a result of a workforce reduction. ... Are older, minorities or female employees disproportionately affected by the corporation’s initial selection procedures? ... Employees affected by a staff reduction should be advised of the RIF in as professional and supportive a manner as possible. ... Management should be brief, direct, and firm as to the corporation’s decision;
c. ... ABC Company needs to asses the risks involved in instituting such a policy.
Approximate Word count = 4430
Approximate Pages = 17.7
(250 words per page double spaced)
|
|
|
|
|
|