Courtesy of CPEhr.com
As business owners look to the new year, layoffs might be on their mind, but there are some things to consider before rushing into this option.
Consider if laying off staff is the best choice.
1. Freeze new hires, pay or bonuses
2. Reduce salaries, fringe benefits, or 401 (k) matching
3. Reduce work hours or adopt alternative work schedules
4. Make selective, performance-based terminations
5. Provide incentives for early retirement
If layoffs are inevitable, be proactive by forming a committee to address the multitude of areas which are likely to be affected. Be sure to review your company’s Employee Handbook and review your termination policies. Be sure to ask, and answer, the following questions:
1. Have you reviewed your company’s Progressive Discipline policies?
2. If so, was the system followed?
3. Are there written employment contracts?
4. Are there union contracts? Do they limit your right to terminate?
Additional areas to consider include:
1. Establish an objective, financially beneficial reason to layoff staff. This will be important if your motives are questioned in the future.
2. Review your workforce and determine which employees will be selected for layoffs.
3. Train managers and supervisors on proper layoff procedures.
4. Draft enforceable severance and release agreements.
5. Prepare COBRA notices.