On-Demand Webinar: Reduction in Force, A Systematic Process

June 02, 2020

In this webinar you will learn the systematic process of how an organization should conduct a reduction in workforce and the do’s and don’ts on how to address those who are impacted but also those who survive the RIF.


Transcript

Hello, everyone. My name is Lise Stewart and I'm the Principal-in-Charge of the Center for Individual and Organizational Performance and I'm so delighted that you are joining us today for this webinar about a reduction in force, a systematic process. We know that these are troubled times and many people have some pretty tough decisions to make so we have asked our colleague, Dr. Matt Kerzner, to join us today to talk to us about some of the ways in which you as a business owner can think about this in a way that is strategic, thoughtful, and in alignment with your organization's mission, vision, and value. So I would like to offer a really warm welcome. Matt, thank you so much for joining us for this conversation today.

Matt Kerzner:Great, thank you Lise. I would like to give you a little bit of an agenda of what I will be covering in this webinar. What is really important here is I'm going to give a business case for downsizing; why organizations think about downsizing. I'm also going to touch upon the effects of job loss and some of the psychological impacts that people go through, specifically those who are survivors within the organization. I'm going to talk a little bit about organizational analysis and the importance of making sure that there are reports and information that is being shared amongst the leadership to avoid any discrimination in any of the people that might be selected for the reduction in force. There is also this transition period for displaced workers and it is really important for organizations to think about how they could help set up their employees or those who are going to be impacted to help them move on and transition away from the organization.

What is really important too, is that the organization has data and document management, all of the forms and documents, and where are they going to store this information so when they need to get to it they have easy access and they have all of the information in one shared secure location. When you are doing a reduction in force it is very important to have a well-defined communication plan. And we will get into what that is. And we are going to talk about the who, what, when and how the communication should be done when you are doing a RIF, a reduction in force. Then when we get into the career change and employment training and retraining, it is going to be really important for the organization to start pivoting to what the new organization looks like. SO how do you take your existing employees to start training them and retraining them to make sure you have a high productive workforce after the reorganization and the RIF has happened?

Then I am going to share some dos and don'ts of what leadership and human resources should be doing when they are conducting a reduction in force. And then I am going to share some frequently asked questions and then I will be more than happy to answer any questions from the audience when we are through with the presentation.

So I want to talk about first, organizational restructure. And this is a systematic process that the organization should follow when they are thinking about doing a reduction in force. The first one is planning; establishing goals and developing strategies and tactics. That is going to be extremely important when you are starting to put your thoughts down on paper. So you want to do an organizational assessment. Where are you currently with your staffing needs? What department can you actually impact reduction in force? And then what is the organizational structure design going to look like in the future? So it is really important to take a look at what you have, the current state, and what you are looking for in a future state when you are starting to put together a reduction in force.

Another one is employee motivation and engagement assessment. Before you do a reduction in force, it will be really important to get a pulse check in how the employees are feeling, motivated, and producing in the workforce. And then when you introduce a reduction in force, how can that employee motivation change? And it will change during and right after you do a reduction in force. So having a good pulse check before is going to be important on how you are going to react after a reduction in force has been implemented. In the future, after a reduction in force, the organization will take a look at the recruitment and hiring strategies and this is going to be very important because before you actually do a reduction in force, most organizations actually do a hiring freeze. And then after the reduction in force and after a period of time you are going to wanting to take a look at your gaps in your organization and what changes you need to do.

Another one is strategic human resource consulting. Do you need to bring in some experts that can help you through this process? I always say, "You don't know what you don't know." So don't be afraid to seek out professional guidance to help you walk through this very sensitive process. Another one is internal leadership development. You have to take a look at your top employee and how can you continuously develop them to keep them going. It's called the path of progression. Even though you are going through a reduction in force, you constantly have to look at your bench strength and still do succession planning within your organization to maintain the growth of your key employees. That can help you in the future.

Another one is, after a reduction in force you have to take a look at your executives. And do they need some coaching to help them through this process and be able to communicate to the existing workforce or the survivors, what I call survivors, so they are well prepared for what is going to be changed within the organization? And then the last piece when you are looking at organizational restructuring is your compensation analysis and design. Do you have to take a look at the, what I call bands and layers of your organization and how people are compensated for the work that they are doing? An example of this would be, if you have an employee that is actually taking on more responsibility during a RIF or after a RIF, do you need to take a look at their job scope and their compensation for taking on more? These are some of the critical things that an organization needs to do when they are starting to think about doing a reduction in force.

I do want to share some important terms. We are going to be talking about this throughout the webinar. So the first one is a reduction in force. And you have already heard me mention this, you might hear the word RIF. And this is when an organization is forced to reduce its workforce due to either internal or external influences. And I will be covering both in future slides. The next one is downsizing. Downsizing is when companies attempt to become more efficient by becoming smaller. How do we do things better and faster with more quality? That is downsizing. Then you have restructuring. This is redesigning a work unit, an organization, a job, a project by establishing a new structure in terms of hierarchy, reporting lines, bands of control, and decision makings.

I do want to share some other terms that you might have heard, specifically with what is going on today with COVID. You might have heard furlough. And furlough is considered to be an alternative to a layoff. I like to call it a little bit of pain sharing. Everybody takes a furlough in order to save some jobs. When an employer furloughs its employees it requires them to work fewer hours or to take a certain amount of unpaid time off. For an example, an employer may furlough its nonexempt employees for one day a week for the remainder of the year and pay them for only 32 hours instead of their normal 40 hours each week. Another method of furlough is to require all employees to take a week or two of unpaid leave sometime during the year. Employers must be careful when furloughing exempt employees so that they may continually to pay them on a salary basis and not jeopardize their except status under the Fair Labor Standards Act.

An employer may require all employees to go on furlough or it may exclude some of the employees to provide the essential services. Generally the theory is to have the majority of employees share some of the hardship as opposed to a few employees losing their jobs completely. So furlough is another term that is very important to understand that because usually a furlough is discussed before a reduction in force. Another one is a layoff. A layoff is a temporary separation from payroll. An employee is laid off because there is not enough work for him or her to perform. The employer however, believes that this condition will change and intends to recall the person when work again becomes available. Employees are typically able to collect unemployment benefits while on unpaid layoff. And frequently an employer will allow employees to maintain benefit coverage for all defined periods of time as an incentive to remain available for recall.

And I already talked a little bit about reduction in force, but I want to go a little bit deeper of what that term means. A reduction in force, a RIF, occurs when a position is eliminated without the intention of replacing and evolves a permanent cut in headcount. A layoff might turn into a RIF or the employer may choose to immediately reduce their workforce. A RIF can be accomplished by terminating employees or by means of attrition. And what I mean that is a lot of organizations will do a hiring freeze and will not with a reduction in force but as people retire or leave the organization voluntarily, they don't replace those employees. When an employee has terminated pursuant to a reduction in force, a RIF, it is sometimes referred to as being riffed, however some employers use layoff as a synonym for what is actually permanent separation. This may be confusing to the effected employees because it replies that a recall is a possibility, which may prevent the employee from actively seeking a new job. So important terms to know as I am walking you through this RIF process.

So I do want to talk a little bit about the introduction and business case for downsizing. Organizational health is very important within an organization and is often measured by the revenue, the cash flow, and the ability to be able to sustain during difficult times, having enough cash to keep the business going. It is making sure that businesses are able to continue benefits with the company in itself and the employees who work in the organization and the communities that the company operates in. So organizational health is shown by revenue, by people development, and constantly growing the organization. But we need to understand that employees are the lifeblood of the organization. Yet, there is no organization that can support and develop employees if there is an economic impact that impacts the organization. So sometimes organizations have no choice but to look at downsizing and to do it in a way that they can keep their foundation of their values, their vision, and their mission of the core organization and be able to measure any outputs. That is very important to keep the organization productive.

Then the last one is reducing the workforce is a strategy that the workforce needs to look at, that the organization needs to look at. An organization needs to stay profitable even during downturns in order to maintain the lifeblood of all employees. And when you do a reduction in force because of economic reason there is historical timeframes. It could take five years to actually bring the organization back to where it was so there are times where reduction in force is needed in order to take that economic impact and reduce it.

I'd like to talk a little bit about some of the effects of job loss and downsizing. First of all, I would like to talk a little bit about some research. Research has shown that job loss produces dangerous increase in personal stress. There is also a higher level of social disorders. Job loss can be stressful and requires several months for a person to adjust. Also when there is a job loss we could see an increase in depression, insomnia, anxiety, and employee suspicion. There is also self-reports of those who have been impacted by a job loss and downsizing as actually seeing illness increase, drug use at higher levels, and even after six months of being let go from an organization you can see illness and drug use increase after six months.

There is a lot of lack of focus due to stress and trauma and job loss and downsizing can erode trust and decrease communication and collaboration with those who actually survive the RIF. This was based on a study that was conducted about two and a half years ago that was actually a long-term study that looked at the effects of job loss. Cobb and Kasl conducted this study. And again, they showed that it was stressful and it lead to increased illness. So it is really important before an organization entertains doing a reduction in force that they actually look at how dangerous this process can be to the organization and their employees who are impacted and those who will be survivors.

There is another important process that the organization needs to do before they conduct a reduction in force. They need to think about both internal environmental factors that might impact a reduction in force and also the external environmental factors. The first one is the internal environmental factors. What is going on within the organization that actually can impact what the organization wants to do in regards to a RIF? So some processes for things to considers is one, the organization and leadership should look at organizational charts. What do they currently look like? What are the key jobs that the organization currently has? And if you are going to reduce your employees, your organization, what does your future org charts look like? What jobs are being eliminated and what jobs are actually taking on more responsibility? Very important.

Also, the business should take a look at what their core business is actually doing and have they taken on more opportunities that they might have to let go or actually pivot to create new opportunities for the organization to either reduce the RIF and the impact of the RIF or an opportunity to use these new opportunities to bring back the workforce? Another important one is reviewing the skills inventory. And what skills inventory means is looking at your existing workforce before your do a RIF and take a look at your employees. And what educational levels do they have? What positions did they hold within the organization that actually helps them to go into different positions if needed? So all the jobs that they have done in the organization is going to be very critical. Have they worked in different departments? What divisions have they worked in? All of this is very important to do a skills inventory of your existing workforce before you actually take a look at who you are going to let go.

Another one that is going to be very important when you are thinking about the internal environmental factors, is are there any pensions that could relate into work stoppages or slowdowns with the survivors or those who do not get laid off? Will they protest any of the RIFs that are going on within the organization? The external environmental factors is another really important piece to look at. And how is this RIF, this reduction in force, going to impact the outside world that you operate in? So what is the impact of the local community? I always say before you do a RIF, drive around your business three miles. Just drive three miles. Take a look at the restaurants, the bars, the coffee shops. What can be impacted if you are doing a massive reduction in force? What impact is that going to have to your local community? People won't be going to breakfast, lunch, out with your friends after work. What will be impacted? Those small businesses that rely on your organization to support them.

Another one might be timing of the announcement. What is going on in your community? Are there local elections? Are there state elections? Can politicians impact your reduction in force and get in the way? So what are some of those timings of when you are going to do that? Also what is the local job market? Is everybody suffering? Very similar to what is going on with COVID. Can your impacted employees get new jobs? Something that the organization should think about but it is not going to impact the RIF, but something to think about especially when you are dealing with the survivors of the RIF.

Another external environmental influence might be if you have a union. The union, you can't just do a RIF, a reduction in force, without negotiating with the union. When you are dealing with a third-party you have to negotiate wages, working conditions, and benefits. And when you do a reduction in force there might be language in the collective bargaining agreement that spells out the steps that you need to take for how you are going to lay off employees by seniority and how you might recall people back. So you have to be very sensitive to any external environmental factors that might impact it. Very important information.

Another systematic process before you do a RIF is doing what we call an employee analysis. And this is taking a look at all of your employees and running reports to make sure that you are doing the RIF process legally. So the first thing that you want to do is take a look at your employee demographic information. This will take a look at by department the age of your employees, the tenure, if you have a union you will call that seniority. What is their EEO status? Are they above the age of 40? Are they dealing with any ADA, Americans With Disabilities Act? Before you start making a list of those who are going to be impacted run some reports and take a look at your employee demographics.

Another important one is employee history. How long has the employee been working for you? As I mentioned in a previous slide, what skill sets do they bring to the organization? If you lose these employees, or a specific employee, will you lose some of your institutional knowledge and do you have that information documented? Another one is alignment with future strategic staffing plan. Before you do a RIF, what was the plan for your staffing? Were you looking to hire? Were you looking to increase your area of where you operate? Were you looking to do a merger and acquisition? Well obviously if you are doing a reduction in force, there are economic reasons why you have to change your staffing plan. But if you have a plan, a one year, two year, three year, or five year strategic plan, you should take a look at your staffing plan and your critical employees for critical positions before you introduce a RIF to your organization.

Before you select anybody for a RIF what is the performance information on your workforce tell you? Do you have a performance process that helps you identify your top 10% employees, your bottom 10% employees? So do you have documented information that helps the organization identify how performance is done in your organization? Another one is skills, knowledge, and experience. I mentioned this regarding the skills inventory in an earlier slide. But do you know what skills, knowledge, and experience is needed in the current jobs that you have in your org charts? And when you start developing your future org charts with less positions you now have to make sure that the individuals who are taking on more responsibility have the skills and knowledge to do the job.

And the last important piece when you are putting your employee analysis together is what past disciplinary information that you have on employees that you could use when you are looking at a total picture of your employee landscape to help you make decisions. So when you are putting your reports together you want to make sure you are looking at each one of these areas in order to have a robust list of those who might be impacted in a reduction in force.

The next slide that I want to talk about is the transition period for displaced workers. A couple of things that an organization can do to help with impacted employees during a RIF process is to provide information those who are impacted about how does the job market look outside of the organization. Are there any openings that could be communicated to employees? And can the organization help provide opportunities of networking for people to look for new jobs? Can there be assessments provided, personality assessments or skill assessments, that could be given to employees who might be impacted to help them find what they are good at if they want to take on a new job outside of the organization, if they want to start fresh? If they want to become a nurse or become a truck driver or become a security guard, are there opportunities for people to go through a personality assessment to see what skills that they have and interests that they have that can help them transition?

Another thing is an organization, especially if they are being very strategic about a RIF, and let's say they are not going to do it very quickly, but they are going to do this and communicate to the workforce and give a 60 day notice, a 45 day notice. Maybe there is something in the collective bargaining agreement that spells out how much notice is needed. An organization once they communicate a RIF, they can also set up a career center within the organization to help do some training for the impacted employees to help them develop their resumes, learn some critical skill sets like mock interviewing skills, and provide them with some additional training that can help them with the next phase of their lives after they are impacted by a RIF.

The next important topic that I want to talk about is data and document management. When human resources and leadership is starting to put together all of the documents that are needed when you are going to execute a RIF, you need to be able to get information very quickly. So you want to make sure you are storing all of your data in a very safe secure location where the employer can get it very quickly when needed. So some ongoing data management or information that should be put together is one, what is the separation date? When is it? Do you have a copy of all of the severance agreements in a location if you need to pull them out and review very quickly? When you put together your communication plan, where is that stored and do people have easy access to get to it? And when I say people I'm talking your leadership, your directors, your senior leaders within the organization.

HRIS stands for human resource information systems, so do you have an employee HRIS system and a payroll process that you can follow to do any changes necessary on a timely fashion that can change the status of an employee. It is very important that you do this so you are not overly paying somebody after a RIF or if an employee communicates after and they need some pertinent information you can run a report and provide that information very quickly. You also have to design and implement a payment process. If you are offering a severance pay and have somebody sign a severance agreement, you want to make sure that you have all of your information ready to go when you are going to pay out your impacted employees.

You also want to make sure that you have the proper EEO, equal employment reporting documents for you and your leadership to review to make sure you are not going to have what we call an adverse impact of anybody who is being let go. You want to make sure you are not doing any discriminatory practices. So you want to make sure you are running reports so you can analyze the list of those who are going to be impacted. Are all the people that are going to be impacted over the age of 40? Are they represented a specific class of employees; race, religion, nationality? If you do, you might be discriminating against a certain block of employees so it is very important that you have all of your EEO reporting done to make sure that there are no patterns of discrimination.

It's also important to have what we call a termination checklist. This is an employer inventory of what the employee might have that needs to be collected after the RIF has happened. For an example, employee badges, any employee equipment like computer or other IT employment, passwords that might be very sensitive for information and reporting, HR documentation. All of this is very important to have when you need to collect information back from an employee who is impacted. I will tell you when a RIF happens and the employee is communicated they immediately go into shock. They are not going to know right at that moment what information needs to be collected and given back to the employer so it is important that the employer has this checklist that they can follow in order to make sure that they are getting all of the materials and equipment back from the impacted employee.

The next important thing I want to talk about is developing a communication plan. It is very critical that those who are impacted and those who are actually survivors of this are communicated in a way that they have enough information that they can communicate to their spouses, their partners, their children about what has happened to them. And the survivors of a RIF also need to understand what is expected of them when they are now working in the organization after a RIF. So this communication plan really gets into what is the audience that you want to communicate to, what is the date or the dates that this communication needs to occur, what are the key messages, the key points that you want to express regarding this RIF, what is the method that you are going to follow? Is this going to be an email communication? Is this going to be an in-person all hands meeting where you bring everybody together and communicate what is happening? Are there going to be one-on-one meetings with the impacted employees?

And then the last important piece is, who is the communicator? Who is responsible for delivering this message? So this robust template is very important to make sure you are documenting all of the who, what, when, where, why of what is going on in the communication. This communication template can be used for both internal communication to employees as well as external communication to anybody that might be impacted, the vendors, that community that might be impacted, local government or state government. Communicating to the union, the third-party representation. You want to think about all of the people that need to be communicated and you want to use a systematic process in order to make sure you are not missing any important information that has to be delivered.

We've talked about creating a career center for helping people transition, but for those who are not going to be impacted they need to get the proper training to take on more responsibilities with less resources. It's very important when you are going through a career change, an employment training and retraining, that you have to take a look at the survivors of the RIF and what skill sets or cross-training they might need in order to take on additional responsibility after the RIF has happened. So a few things that you need to take a look at. First of all, HR, human resources, should conduct what is called an employee skills gap analysis. What current skill sets do the survivors have in taking on additional responsibility? What gaps do they have and what plans need to be put in place?

For those who are impacted, we like to call this a desk plan. If somebody goes into their workstation or into their office and they are no longer a part of the organization can you see any of the documents that tell you where you can find things? Where are the important files? What are the current projects that were worked on or being worked on? What are the phone numbers to any of the vendors or customers or employees that they are working with? So a desk plan is very important for an organization to have to keep this process going after a RIF. We already talked about the skills inventory, but it is very important that after a RIF the organization takes a look at that skills inventory to see who is capable to step up and take on more information.

Another one is cross-training. And before you introduce cross-training take a look at the employees you have and who did the jobs already. What hats can they continuously wear to help the organization stay productive? And then do you have people within your organization, I like to call them high potentials, that actually have the capacity to do more and how can you work with them to give them the training and tools that are needed to help them be successful?

The next slide is what I call the dos and don'ts and this is very important. This dos and don'ts list is really for those who are going to be communicating the reduction in force to those who are going to be impacted. So this is important enough for me to read, and I'm going to cover the dos and the don'ts simultaneously. So the first one is the do, when you are conducting a RIF, I do encourage people to write down what is needed and what is going to be said to the impacted employees. So I always say script yourself on what you are going to say and stick to the script. Don't say anything that is going to put the company or yourself in jeopardy. However, what you don't want to do is don't read from the script. Don't read it word for word. Use your heart. Be compassionate. But again, make sure you are covering all of the bullet points in the script.

Another important thing is be humanistic and be empathetic with the situation. This is not easy for anyone. But what you don't want to do is you don't want to apologize or try to explain the decision. You can explain why this is happening and follow the script, but don't apologize or try to explain or give your opinion of why this is happening. Another one is share all company updates with a personal note to your direct reports. After this has happened have a meeting with your direct reports and give them an update about the future state of the organization and what happened with the reduction in force. But what you don't want to do when you are meeting with employees, those who are impacted and anybody who is a survivor, don't speak down to them. Don't patronize them. Listen carefully and respond appropriately to any questions that will be asked of you by those who are impacted and those who are survivors.

Another important thing is to think of future states. The RIF is a snapshot in time. If you have a strategic plan and you are doing this RIF as part of your strategic plan, then think of the future of how you are going to pivot to continuously grow opportunities for the organization, how you are going to operate efficiently. When you are going through a RIF this is an opportunity to take a look at how you do things and how you can you do them differently. And never ever forget about your employees, your bench strength. They constantly have to be groomed. Even though you are going through a reduction in force, succession planning should always be thought of because there are key employees that will be not impacted but will possibly leave the organization and you have to have people ready to replace them.

Another thing that is really important is don't dismiss any employee's feelings. This is real. People have emotions around this topic, those who are impacted and those who are survivors, so it's very important. Be very sensitive to the privacy of this RIF. The last one, or it's actually not the last one for the dos, and I mentioned earlier, make sure that you stay with the foundation of the mission, vision, and values of the organization. You will rely on those to keep your employees focused on what is important after the RIF, to keep productivity moving in the right direction.

And then, it's really important, you want to have office hours to meet with employees to answer any question or concerns that they have. This could be for those who are impacted, if they want to call the organization and speak to somebody about this you can have specific times for them to call in. Or for those who are not impacted by the RIF, you want to make sure that you have an open door policy and specific times that they can come and speak confidentially to you. And then very important, the last don't, is don't make light of this situation. This is again, a very sensitive topic and more importantly this is something that is out of the control of those who are impacted.

So I just want to cover a few things about survivors' concerns. I mentioned the word survivor, there are going to be people who are thinking about, "Why wasn't I impacted by this? Can this happen again to me?" There are some important survivor concerns that need to be thought of when you are going through a RIF. Employees that actually are not impacted by the RIF still will have some feeling of one, they might feel guilty that they still have a place to call home, that they still go to work. Also, because management kept this RIF process very quiet while they were putting it together, there might be ruined trust and the employees might think, "What is next? If they are not communicating to me why this is happening or who is impacted." Again, not giving enough time. There is going to be, "Am I okay? Can this happen again to me?"

Another one is some symptoms to think about. Survivors after a RIF, the organization will see lower motivation and morale. Again, people are going to think, "Is this the only time they are doing a RIF or am I next?" There will be some reduced loyalty. People are going to be losing their friends, possible family members through this RIF process so there will be a reduced loyalty for those who are not impacted. They actually might spend some time during work looking for new opportunities. So you need to be sensitive to those situations. And then we already talked about feeling of guilt. People will feel guilty of why this did not happen to me.

So with the survivor concerns there is also what I call the grieving process, an emotional response that happens. So when a manager, HR, leader communicate a layoff, a RIF, we never know employees or impacted people are going to take this. It really all depends on how long employees have been working for an organization, what professional experience do they have, what economic situations they might be facing at home. Are they the only ones in their family that might be impacted with layoffs? So really important that leadership management understand that employees are going to react in a different way. They might feel denial. Employees who are going to be getting the communication of the RIF might not even realize what is happening to them at the moment. They might be in denial. They might be seeking some meaning of why this is happening. Why is this happening to me? Can you explain this to me?

They might accept the RIF. They might understand the actual economic impact and understand that this is out of their control and they might actually be relieved. There could be some anger. People might be very upset that the organization didn't take furloughs for example more serious than doing a RIF right away. So anger might step in. I've seen impacted employees actually bargain. They might say, "Well, I have additional skill sets that I might be able to offer. Can I take a lesser job for lesser pay?" So employees might get into a bargaining or negotiating with the employer to try to keep their jobs. We already talked about some symptoms of stress. Depression might come in. People might feel lost. Fatigue might come in. So depression is very real when people are going through a RIF.

And then the last one, employees, those who are surviving and those who are impacted, also will test a little bit of their assumptions and they are going to try to keep tabs on the organization and what the organization is doing after a RIF. Are they hiring new employees? Are they promoting some employees that are survivors? So they are going to test the organization a little bit to see if they are doing all the right things that they should be doing when they are doing this process.

It's very important, and we talked about the communication process, that the organization actually puts together frequently asked questions and that these questions and answers are used by the leadership and human resources to actually answer any questions that might be asked of them so that they are answering it in a way that is very consistent. A couple questions might be; why is this company eliminating my position or eliminating these positions? What are my departure details? What about my compensation and severance? And what about my benefits? So we put together as part of our tool kit a list of several questions that might be asked by employees and answers that management can do it. We took these from best practices and from organizations that have gone through a reduction in force.

So I mentioned a tool kit. So one of the important pieces of what we offer when we are helping organizations through a RIF process is a tool kit and this tool kit is a list of frequently asked questions, an employee blueprint which really gets into current state and future state and all of the steps that need to happen in order to get these surviving employees ready to take on any additional responsibilities. If you have to redesign a job, we provide a job description that gets into the skills, knowledge, and abilities for you to recreate new job descriptions if the organization is now changing. We already talked about looking at your organizational chart, so having both a hierarchal floor chart and a matrix floor chart is very important when you are starting to redesign a new organization. You want to have a separation agreement template to be used so you can populate it with information. You want to have roles and responsibilities and you want to be able to have clear understanding of what those roles and responsibilities are. So in your tool kit you should get into all the different jobs, a job analysis, a job title, and specific roles of what people have.

If you are going to do a reduction in force, we provide a checklist to make sure you are covering everything that is needed when you are going through the reduction in force; your communication plan, thinking about the internal, the external environmental influences, everything that we mentioned earlier. If you are going to put this RIF in a process, you want to follow what we call a project approach. What is the results? What are all of the deliverables? How are you going to measure the success of this? What are the assumptions of success for the RIF? And we provide a project approach that can help you. And then you want to have for those who are survivors some protocols to keep your existing employees motivated. Very critical. So again, this tool kit is something we provide the organization or your organization so you have a process that you can follow that is very systematic and very sensitive during this very difficult time.

So at this point I would like to open it up for any questions that the audience might have. So Lise is there any questions that has come in through this process, this webinar?

Lise Stewart:There have been Matt. Thank you. First of all, we have got lots of notes here saying, "Great job. Super informative. Wonderful information. Can we have copies of your slides?" And on and on. So a lot of really positive feedback. There are sort of a little clump of questions that have come together around the actual discussion that you would be having with an employee when you are bringing up the reduction in force. So a couple of them are around this idea that while, let's see, While you aren't supposed to apologize for what it is you are doing, are you able to express to the employee how sad or how bad this feels to be doing this? Can a leader in an organization express that level of vulnerability?

Matt Kerzner:Yeah. Great question. It is very important to be empathetic through this process. It is okay for a leader, human resources, a supervisor to explain, again, that if this was done for an economic reason, that this is something that the organization has to do and it is not something that is pleasant. But you should never tell an employee that you disagree with the organization and why they are doing what they are doing, right? You have to be able to communicate effectively on what and why this reduction in force is happening, that it is something that is not pleasant, that it is something that the leader does not like doing, however don't put blame on the organization, especially when the economic impact is out of the control of the organization.

Lise Stewart:Right. That makes sense. So another person asked a question about this idea of bargaining. If an employee is part of that conversation, comes back, and wants to bargain and has some good ideas is it okay for leadership to engage in that conversation?

Matt Kerzner:Yeah. Another great question. That is a very sensitive one. It is a very common trait for employees who are impacted by a reduction in force to try to negotiate a lesser opportunity within the organization so they can maintain a paycheck. What is really is important here is that the informer or the notifier does not get into a negotiation. First of all, they probably don't the authority to do that. And number two, there should be no promises made to employees. With that said, it is okay to inform the employee who is impacted that they have every right to apply for a new job within the organization, if they see a job that they are qualified and have the skills, knowledge, and ability to do. That's not negotiating or bargaining. That is providing factual information about possible future opportunities.

The employer who is communicating should follow, as I said in the dos, follow the script. You should highlight the separation agreement, the benefits that you are offering the impacted employee, and follow the frequently asked questions and only answer the questions in the way that the organization put it together. You never want to make promises or negotiate something that you don't have the authority to negotiate or get into a situation that might cause some problems in the future.

Lise Stewart: Right. That makes sense too. So I know that we are coming up to the very top of the hour so I'll just say one more question and that this is our chance combining a few different questions here together. There is some discussion about unions. I guess primarily here the question is, When do you involve the unions? Do you need to be contacting the union and communicating with them before you conduct the reduction in workforce or how does that work, the relationship?

Matt Kerzner: Yeah. Another fantastic question. When you are dealing with a third-party, a union, as I mentioned earlier, you have to negotiate with a union regarding wages, working conditions, and benefits. And when you are doing a reduction in force there is what's called effects bargaining, and depending on the size of the organization and the size of the reduction in force there is specific language that might be in the collective bargaining agreement that explains the process of how you have to do a reduction in force, how you do a layoff. And the organization cannot just pick names of impacted employees going to be impacted and then give them notice. They actually have to sit down with the union and take a look at the language in the collective bargaining agreement regarding how much severance, if there is language in there about that, how much notice has to be given regarding the reduction in force. I've seen some union contracts that say you have to give a 60 day notice. Some contracts say the 45 day notice.

So it is very important that when you are dealing with the unions you have to get into what is called effects bargaining. So before you put your reduction in force plans in place or once you have your plans in place you need to sit down with the union based on the language in the collective bargaining agreement and follow the rules of engagement that has been negotiated and give the union a voice on the process. It is called effects bargaining. Give them an opportunity to either negotiate changes for the impacted employees or at least inform them of what you are doing and allow them to communicate. If you don't do that, you might be running into what we call an unfair labor practice and you can get into problems if you do the reduction in force and not include the union in the process that you are following based on what you agreed upon and allow them to negotiate any possible changes in the collective bargaining agreement that could possibly enhance the severance that is already stated in the collective bargaining agreement.

Lise Stewart:Right. It sounds pretty complex, but I have to say I really appreciate the way in which you have shared the information and also taken a very compassionate approach. We were listening to you in caring about those employees. I know that we can probably spend the greater part of a whole day on this but I want to make sure that our participants today know that we have a wide variety of resources. I'm sharing this live to make sure that everyone knows that we have our COVID-19, coronavirus knowledge center, and a lot of resources available to you as you are making decisions during these really very challenging times.

So Matt, once again, thank you so much for taking the time today. I really appreciate it. Thanks to all of you for listening. And please, visit our website if you would like some more information. Thanks everyone. Have a great day.

About Lisë Stewart

Lisë Stewart is Principal-in-Charge of EisnerAmper’s Center for Individual and Organizational Performance and the Center for Family Business Excellence within the Private Business Services Practice. Lisë has experience in organizational development, strategic planning and training, and human performance management.

About Matthew Kerzner

Matthew Kerzner is a Director in the Center for Individual and Organizational Performance and the Center for Family Business Excellence. Matt has more than 25 years of experience in organizational development with a specialization in assisting family businesses and closely held businesses.

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