Hr Challenges in Managing Employee Separations, Downsizing and Outplacement

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HR Challenges in Managing Employee Separations, Downsizing and outplacement

*** LAKSHMISHA.K, Vice Principal, S.V.E.I. First Grade College, Vijayanagar IV Stage, Mysore

Abstract

An organization’s effort is to hire the ‘best’ Human Resource (HR) talent available in the market. Sometime, due to sundry reasons, it becomes imperative for the organization to part with some of their employees. Employee separations, downsizing, and outplacement are some of the techniques adopted in the aforesaid endeavor. It is important to not here that the organization incurs significant costs both during the hiring and in the employee ‘separation’ processes. The paper examines the dynamics of the techniques employed to part with the employees.

It is no secret that U.S. industry, once the most productive in the world, is now lagging behind its global competitors. What is not well known is that blue-collar productivity is not necessarily the problem. Between 1978 and 1986, for example, the number of production workers declilned by six percent while real output rose 15 percent. White-collar productivity decreased six percent while the number of workers increased by twenty-one percent. Downsizing, which involves reducing the workforce, but also eliminates functions and redesigns systems and policies to contain costs, is becoming more common in U.S. companies. Despite its pervasiveness, however, downsizing has rarely been investigated by organization and management researchers. This article seeks to identify the processes used in effective downsizing as well as the consequences that result. The authors studied organizational downsizing and redesign for four years in thirty organizations in the automobile industry. Six general strategies are presented that highlight the best practices of these firms that are downsizing effectively.

Introduction

Employee Separation is one of the very important and crucial function / process of HR Department. This process, if not handled in an efficient manner, can lead to various legal complications.

Let’s understand the term employee. According to various definitions an employee can be defined as: 1. A worker who is hired to perform a job (wordnet.princeton.edu/Perl/webwn) 2. An individual who provides labor to a company or another person (en.wiktionary.org/wiki/Employees) 3. An individual who provides services for compensation to an employer and whose duties are under the control of the employer. (www.aspa.org/resources/res_news_glossary.htm)

An employee works for an employer and gets paid for his work and nothing else. The relation of an employer and employee has a beginning; they stay together for a while and then they separate. Beginning of the relation is called as recruitment process or talent acquisition that passes through selection phase and followed by induction. Staying together in the relation comprises the various phases such has performance management; career management; professional growth; development and etc. And the final stage of the relation is the separation.

Broadly speaking, in normal scenarios the separation between employer and employee can be due to any of the following three (this will be discussed in detail in subsequent paragraphs): 1) Resignation – Employee decides to leave the organization. 2) Termination – Employer decides to break the contract of employment. 3) Absconding – When the employee decides to leave the organization without tendering his resignation or following the proper process of separation.

Apart from the above mentioned, the relation between employer and employee can also be terminated during the lay-offs (Financial or economic crisis); during the process of mergers, acquisitions and take-over; or any other legal intervention by the state or central government. Based on the type of employee that has been hired by the company, if local or an expatriate or a national of other country or if an...
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