Lay offs

Jayhawk

Our company is planning on laying off several individuals in the next several weeks due to lack of accounts and no work for them. We have less than 100 employees and are not laying off more than 50. Can anyone who has been down this road before give me some things to watch out for legally....FMLA issues, ADA, etc.? Should the layoffs be performance based? Any help would be great.

Sunny

There are many things to consider before a layoff, but if I were you, the first thing I would do is establish a written plan that includes the basis for the layoff, severance procedures, etc. If your state is employment-at-will, you can use any basis for the layoff - performance, seniority, department - but you need to make sure you are consistent. Also, once you have your plan you may want to do an impact ratio analysis to assure that you are not creating "adverse impact" on any protected class. That means, if your plan ends up laying too high a percent of your hispanic employees or older employees you need to take another look and make sure you have a justifiable business reason for proceding that way. You can lay off a person on FMLA, if he or she would have been laid off if actively at work. Again, a written plan will help justify this.
This topic has been dealt with before in the Forum so you can do a search and get better advice. Good luck - these are never fun.

vmiller MO

Since you are in MO and apparently nonunion, you have the luxery of the employment at will doctrine. You can, therefore, pick and choose. What you cannot do is utilize unlawful reasons such as race, religion, sex, ethnic or national origin, age if 40 or older, disability, filing workers comp claims, union status, etc. In reviewing your selections, you should look to disparate treatment and disproportionate impact in order to evaluate whether you may have issue involving the antidiscrimination laws. If you have potential issues with these laws, then you need to have objective criteria for your selections and have to be able to show that there were business justifications for the decisions.

From a practical viewpoint, it is important to be able to explain to employees how selections were made. Employee morale is at stake. If you are arbitrary, the surviving employees well say "this can happen to me."

For these reasons, many employers have established guide lines. As a word of caution, "seniority" has no legal meaning. Its meaning comes from what you give it. It does not even have to be taken into account, but most companies do.

If you establish a plan, I suggest that you "war game" a layoff before you adopt the policy to determine exactly what will happen in the real life situation.

As you can see, reductions in force have many issues. I suggest that you seek advice of counsel.

As to FMLA, the threshold is 50 employees.

Good luck.
Vance Miller
Editor, Missouri Employment Law Letter
Armstrong Teasdale LLP
(314) 621-5070
[email]vmiller@armstrongteasdale.com[/email]

Margaret Morford

I have a lay-off policy I'll be glad to send you if you e-mail me. It may give you a starting point.

Margaret Morford
theHRedge
615-371-8200
[email]mmorford@mleesmith.com[/email]
[url]http://www.thehredge.net[/url]

Zanne

Jayhawk:

We are experiencing a layoff situation also. I have a "Skills Worksheet" that you rate all the people with the same job so that you may select the lowest performing people for the RIF. We have run this worksheet by Blackwell Sanders in KC and they have blessed it.

Send me your email address and I'll share it if you want.

Zanne

Don D

I have found that kind of scenario problematic on two occasions. A rating instrument that is put in place only at the time of RIF raises red flags. The first thing an attorney will do is compare the instrument with his client's past 4 or 5 performance reviews and rarely is there consistency. You will also be put through the mill on things like: Who developed this instrument and why? Why is this instrument now put in place when you have for years had a performance rating instrument as your files show? Does this instrument now somehow negate the performance review instrument and long standing policy you've had for its utilization? On what basis were these questions chosen and by whom? It is much more defensible, and in fact more simple, to use the past three or so reviews as your method of rating and ranking performance, if indeed your RIF procedure goes to performance. If an attorney finds one or two holes in this new instrument, which he certainly should be able to do, your RIF methodology will sink you.

You can also defend reduction by location, by department, by position/job title, by seniority or by status (such as non-state service or tenured). Whichever your company selects, stay with it with absolutely no deviation or monkeying with it. You may find that an ordinary, systematic, well mapped out RIF will affect someone on FMLA, Comp or other (normally) protected absences; but typically they lose that protection during a defensible RIF.

szemcumo

Zanne,

I would love to rec a copy of your Skills Worksheet in regard to lay offs. My e-mail is [email]szemblidge@versa-tags.com[/email]

Thank you in advance.

Sandie

Pork

JAYHAWK: Your PLAN is your organization structure after the RIF. Once you have a plan and an analysis of what position is going to handle which task, has been accomplished, then you can decide how you want to approach the identification of the specific indviduals qualified to handle the particular positions. In some cases you will want to rewrite job descriptions to fit the assigned task before you approach anyone. In some cases those selected can see the handwritting on the wall and may tell you it is time for them to go, which means you will have one less person to fit into holes, squares, and diamonds.

Good luck, wish you did not have to do this it is not a whole lot of fun being the HR who has to execute the plan and prepare for the new organization with a lot of stress every where!

PORK