RIF Question

jennifer jo

Hi everyone, it's been quite awhile since I've posted, but I'm hopeful that you will have some ideas for me. I've recently heard that a large employer is going to lay off all of its ees and then have them re-apply for their positions. The word is that everyone will have to interview again, etc. Has anyone ever heard of this practice? It doesn't make sense to me to implement a reduction in force using this method, but is there something perhaps I'm missing? Thanks. Jen

NaeNae55

We are a small company owned by a large company. We had about 30 employees, but after terminating one of our lines of business in 2001 we downsized to 12 (we now have 14). Every job, regardless of level, was terminated at the same time. We had 12 new positions, and every employee was encouraged to apply for as many as they were interested in. I know of at least one employee who applied for every single position, including the CEO's. More than one department disappeared, and others were drastically cut. Our 5-6 person accounting department was cut back to 1 position.

We interviewed with the CEO and she ultimately decided who would stay on and in what role. It was shortly after that this accountant became the HR person too (among other duties). Some changes that look bad on the surface can open up entirely new areas that you would not have even considered before.

The CFO (who was one of those that went) was extremely cautious with legal compliance. I am sure it was all legal.

Good luck!

Nae

jennifer jo

Thanks for the information. Fortunately, this isn't happening at my workplace! I think one of the bad things about this is that staff in MT are hearing that this is going to happen from staff in WA. None of the higher ups have said anything and so the rumor mill is flying! One of my friends has been with this company for 18 years. He's concerned that one of the reasons they are doing this is because they want to reduce everyone's benefits, i.e., years of service for pension, vacation, etc. How were those benefits handled at your company? Also, it will be interesting because if they do terminate everyone, who will service the customers? I don't know; I still question the ethics with this type of RIF. Thanks for getting back to me. I appreciate your help.

NaeNae55

The positions were abolished, so no employees were actually terminated unless they did not win one of the positons. Everyone who won a new position kept their benefits, and our longest term employee was among those that stayed. I was not involved in the selection process, but it appeared to me that qualifications and general attitude were what won the day. It was not used as a basis to reduce benefits, but rather as a way to reduce less effective employees. We lost a few good ones too, but most who were lost were employees with a history of poor performance or other issues.

One other thing the management chose to do was to help employees find other jobs. Our CEO read the paper, etc. When she found out an Accounts Payable position was opening she personally called the CEO there and got our employee an appointment (and she got the job). A few employees were absorbed into our parent company. Only one employee left without a position to go to. She was a supervisor at our company. She was offered a position at the parent company with the same pay, but since it was not a supervisor's position she declined.

It sounds like your management team needs to do some communication and fast. Once the rumor mill gets started it is hard to control. The last thing a company needs is to lose good employees who fear an uncertain future. The less effective ones are almost always willing to stay.

Good luck!

Nae

dlail

I know of a company that did this due to inherited problems, long-term ees who'd become complacent and lackluster management. They fired everyone and interviewed "former" employees. I believe 18-20 out of 25 either applied and were hired or applied and the majority were hired. The marginal ees generally knew it, and didn't bother. The concept definitely has its appeal . . .