young company needs "right-sizing"

Lone ranger HR person here - working for a 2 yr young company. We have too many chiefs, and need to do something about it.

Our administrative team of 3 was reduced to 2 last month, due to performance issues of the person in the now vacant position.

This team has a Manager. He was the first person in the department, hired as receptionist. He was christened Manager as the department grew.

Now that the department has it's structure, and is fairly efficient, there really is no need for the Manager position.

The CEO has suggested we move the Manager back to the department as an Administrator.

His pay is substantially greater than that of the others.

I have suggested moving him to a Supervisor, rather than a Manager, where he can work amongst the department, and a pay adjustment may be needed.

This employee knows his current position has slowed drastically, and probably wouldn't be surprised by this move. However, the team morale may be another problem.

Any feedback?

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