Criteria for Employee Layoffs

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Criteria for Employee Layoffs

During the process of cost cutting, it becomes necessary for the employer to determine the criteria for layoffs in order to avoid legal hassles and substantial loss to the company.

The criteria for laying off employees varies from company to company and demands of the market situation. The process of downsizing is hard for the employee as well as the employer, and a lack of professional ethics can make it more painful. Following are the criteria for employee layoffs which should be considered before one abets the process.

Legal Issues

The legal aspects of an employee’s layoff should be considered seriously, while downsizing the workforce of the company. There are many cases in which the service of a particular employee cannot be terminated. Some additional benefits need to be provided to employees, along with a strong reason to validate the job cuts.

One should consult a lawyer regarding the legal implications of downsizing and the issues related to it. The US law provides every employee with the right to file a lawsuit under the Worker Adjustment and Retraining Notification (WARN) Act, against his employer in case he doesn’t receive up to 60 days of an advance notice for mass layoffs.

In addition to it, the employer must continue to pay and grant the benefits through the notice period. The pay which one receives at the end of his service, is in compliance with the WARN Act’s advanced notice requirements and not the severance pay. This act, in some cases, is not applicable to an employee serving his probation period in the company.

Probation Period and Length of Service

Probation period is the length of time during which an employer can lay off his employee without any severance, reason or legal hassles. This period does not last for more than 6 months according to the US law.

In most of the companies, senior employees are given advantage during layoffs because of their experience. Recently recruited employees are the ones who have lesser experience and are often considered for layoffs first.

However, the sole criteria for keeping back an employee during the process of downsizing, should not be only the serving period. Other factors like the employee capabilities and present requirements of the company, should also be taken into account.

Domain of Employee Expertise

Employee performance plays a key role in deciding his growth in an organization. To avoid a talent void in a company, his usefulness and dexterity should also be taken into account before giving him notice.

Some employees might be new for the company, but would have consistently performed beyond the expectations of the employer. These employees should be retained so that they can prove to be beneficial during the uptrend of the company.

Their area of expertise and prowess in a particular domain should be compared with the other employees, and should never be overlooked.

Employee’s Attitude towards Work

As a chain is as strong as its weakest link, the strength of a team depends on each and every member. Some employees have a negative attitude towards work because of which their teams suffer.

The feedback from other employees and from the human resource management play an important role in deciding the performance of an individual and his compatibility with rest of the team. Employees’ compatibility with their teams and their good performance, should be given an advantage during layoffs, as good team players are worth betting on.

As layoffs may affect the career and future of the employees, they must be given sufficient time to speak their mind. Most of the employees are professional enough to handle the layoff notice with dignity, but some may take it personally, giving rise to small disputes within the organization.

If nothing can be worked out and layoffs are inevitable, it is always better to make the employees aware of the situation well before their exit from the company. This will give them time to start a job search and look out for other alternatives, while serving the notice period.

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