7-3 Article Analysis Downsizing
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Jan 9, 2024
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HR Article Analysis: Downsizing
Kimberly A. Rothwell
December 19, 2022
OL-645-X2223 Law Ethics & Politics in HR
Summary of the Article:
When summarizing the article, the first thing is that
downsizing is a toxic solution for
any business to do. This for a business should be used as a lifesaver not as the final answer to any
problem a business is having. A company needs to preserve the organization’s intellectual capital
so that it shows the stakeholders that the business is doing fine even if they are downsizing.
Downsizing should never be used as a communication to the investors or to the financial
centers to show the cost of downsizing that outstanding any benefits this gained (Law, 2011).
This is because this is not the way to run any type of business. The article talks about how to
avoid the pitfalls of downsizing that can cause issues in the business. It also talks about the legal
concerns and how to deal with them. Making sure when you do downsize how to go about
downsizing and in what is the right order to do it in so there is no legal action that can be taken
against the business for wrongful termination. Next the article discusses downsizing effectively
and how to make sure that you are not having too many people and not enough profit. That will
cost the company in the long run because you as HR might have to let more people go than what
really needs to be let go of what is going on.
Considerations for the downsizing Process:
When downsizing you need to make sure you have a process in place. The reason for that
is that there are no legal concerns when it comes to the layoffs at the times they happen. The first
thing that needs to be done when you are considering downsizing is to look at all the
departments.
Most companies’ attorney’s will advise HR to lay off the employees that were the last to
be hired. They should be the ones that should be laid off first because they have not been there as
long as other employees have. This way employees cannot sue for wrongful termination if the
last ones hired are the first to be let go of.
Next HR should give as little notice about the downsizing as possible. This way business
can continue without the ones that are being let go so that they don’t sabotage the rest of the
employees and the business. You as HR need to act like nothing is happening until it does this
way business can continue as it does on a day-to-day basis.
Impact on Employees:
The impact the downsizing will have on the employees will be hard because employees
build friendships through work and seeing someone let go they tend to think that it could be them
next. You as the HR manager need to always respect people’s dignity (Law, 2011). When the HR
manager remembers that the people, they are letting go have feelings and that they may have a
family that they are taken care of, this shows the employee that you do care.
Giving them the respect that each employee deserves, whether you are letting them go or
keeping them, allows them to know that you follow the law and work with the legal department
to respect the employment laws. When considering which employees to lay off you must
remember that laws do prevent certain employees from being let go because of certain
entitlements. This is what can impact your decision on which employees to let go of, such as age
discrimination, disabilities, retraining and work adjustments. These entitlements fall under many
laws that can prevent you from letting them go during the downsizing process. So, it is important
that as an HR manager that you know each law that is out there and you follow them to the letter
of each of them so that the employees don’t file a law suit against the company. Because if you
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let someone go that falls under any of them and they file a wrongful termination suit you and
they can and will be sued for lots of money.
Outline the requirements for effective downsizing:
Requirements for effective downsizing start out with a well thought out transition plan.
You need a detailed plan for what employees (departing and remaining) can expect from the
organization (Lively, 2020). If you don’t have this type of plan, then you will only have problems
when it comes to letting people go. Because they will cause problems with the employees that
are staying there. The next thing that you will need to do is work closely with the human
resource team. This should seem obvious, but most times it’s not. HR can help to make the
downsizing process easier for everyone. Maintain open and clear communications. Having good,
two-way communication before, during and after the downsizing will help all the employees.
Make sure to provide outplacement (transition) services (Lively, 2020). This service will help to
alleviate the stress and frustration for all the displaced employees. This will also show the
displaced employees that as a company just because you are letting them go you still care about
their welfare and what is happening to them.
Using this outline, it should help with the downsizing of the company and to make it easy
for you as HR manager to be there for the employees that are being downsized and for the
company. Many times, HR managers need to make sure that they are supportive of the entire
business because it will show that you are working with the entire staff and not just for the
business and that you have a heart.
Reference:
Law, Jonathan (2011): Downsizing with Dignity
https://search-credoreference-
com.ezproxy.snhu.edu/content/entry/ultimatebusiness/downsizing_with_dignity/0
?
Lively, Richard. (June 3, 2020): Downsizing: What Critical Steps Do You Need to Take
https://rairesources.com/4-critical-steps-when-downsizing/