In this current era of demonetization and recession, organizations are running pillar-to-post, in the tryst to save costs. Whether they call it downsizing, right-sizing, the hard truth is companies and human resource departments avoid cutting down manpower, delaying the problem till it’s impossible. It’s usually the last resort used by companies to stay afloat in very lean financial conditions. Broadly speaking, most companies will try to cushion the pain with pay cuts and cut-backs first before giving out pink slips.
Retrenchment may sound like a grave term, yet it’s nothing but a dismissal for operational reasons. Retrenchment can occur due to the following reasons:
- economic reasons– financial decline, as a means to retain sufficient funds to continue operations
- technological/ regulatory/ environmental reasons– reducing the need for labour
- structural reasons-flatten management structure/ switch from a functional corporate to project based structure
- Obsolence- the rate at which skills, products and technologies are getting obsolete is now faster than ever.
Although, employers might try to soften the setback, a dismissal is simply a loss of occupation- something that can be hard to come in terms with, for any loyal employee. It is expected that an employee could save his/ her job during retrenchment through the following means:
1. Regardless of the reason for retrenchment, any organization would have an operational requirement to retain employees with a record of consistent good performance where one has contributed to the growth and sustenance of business. You need to prove your worth through a slew of good performance. No organization would let go of an excellent performer. Always be prepared to provide your 100% best, in every situation- whether challenging or nominal.
2. Be open to continuous learning and upskill/ re-invent yourself with skills/ competencies currently required in your field of operation. Most large companies offer active cross skilling opportunities to their employees which we should actively take up. As products and technologies get obsolete we need to rework towards multiskilling ourselves and be the ones to grab the opportunities. Organizations appreciate deftness in skills, a sure sign of an proficient employee. The key to retention is making yourself an asset to the organization.
3. Be flexible – open to re-deployment/ transferfor alternative positions/ levels within a revised structure i.e. fill in vacant posts in direct roles or those which have an impact on the top/ bottom-line of the company (as opposed to indirect support or redundant roles). Pick up any opportunity to learn a backup skill (during non-working hours), even while you are employed. This additional skill can be revamped as a source of income when faced with unforeseen circumstances such as retrenchment and unemployment.
4. Work together with the business to come up with workable plans to improve income or profitability –
- Build a proficient team for collecting suggestions, monitoring and reducing costs e.g. defer or cancel discretionary payments, common sense cost reduction such as electricity, stationery, telephone, company vehicles
- Increase income through a review of business operations, go to the drawing board to streamline business.
- Provide alternate options for revenue generation- like extra hours or ingenious plane to scale up cost.
5. Give your consent to changes in terms & conditions of employment as measures to avoid dismissal: benefits or remuneration; increase/ decrease in shifts or length of shifts; perform the work of contractors or casual employees. Always keep a tab on your contract to see if retrenchment and corresponding benefits are clearly implied. Otherwise, prepare yourself to negotiate for your retrenchment benefits should the situation arise. Always see the best benefit for yourself, keeping financial situations in
If none of these work or things have really gone down-hill and operations in some divisions have to be shut down, identify products/ services that can be sold or set up as businesses that employees can take over and/ or become suppliers to the company. Setting up a business seems like to be the best feasible options as you can brand yourself while connecting with like-minded people, and potentially make a good amount of income one day by selling your product or recommending other great product. Remember, when the going gets tough, the tough gets going.
Authored By: Mr. Sidharth Agarwal, CEO, Spectrum Talent – A leading Global HR Service Provider