A broad spectrum of personnel measures exists to safeguard the ongoing viability of the company. Textbooks contain extensive information on this topic but only examine specific areas. In contrast, the study presents an overall picture together with all of the perspectives. The key questions were:
- What instruments have proven their effectiveness when reducing the staff levels by more than five percent of the core workforce?
- What measures are widely used?
- What is important to the stakeholders when it comes to staff reductions?
Individually and voluntarily agreed resignations and severance payments are preferred
The results show that the approach to reducing staff has to match the company. For example: in some cases, small companies prefer a different approach to large companies. As a rule, individually and voluntarily agreed resignations and severance payments are the preferred means.
60 percent recommend a transfer company or transfer agency
Slightly less than half of the respondents (45%) advocated individual severance agreements. More than half of the participants (60%) recommended combining staff reductions with a transfer company or a transfer agency. Using this approach, the employees affected by the staff reductions receive help with finding a new job or reorienting themselves professionally, even before they lose their current position. The state subsidizes both measures, the transfer company and the transfer agency.
(Early) retirement has proven its worth
The study also shows that (early) retirement schemes and short-term measures outside the core workforce have proven successful. The respondents also mentioned hiring freezes or allowing temporary contracts to expire as specific examples.
Lack of practical help to cope with fear
All of the respondents could understand the fears of the employees affected by the staff reductions and of the remaining employees. However, the fears themselves are not “treated”. Only a limited number of companies finance psychological support for affected employees or outplacement, or provide a budget to retain future high performers. Company social counseling or the Employee Assistance Program (EAP), its counterpart via external service providers, have both proven their value. These options offer practical help for affected employees, managers and family with all their professional, private and personal issues.
Securing the future by ideally balancing the different perspectives
From the management’s perspective, personnel reduction programs serve to safeguard the future of the company. Works councils and HR departments are aware of the financial motivation behind staff reductions, namely the cost savings. However, HR departments primarily focus their strategic perspective on creating a secure personnel structure for the future.
Staff reductions are so challenging because they are usually initially financiallydriven. Yet during the process of implementing the staff reduction, a sustainable staff structure also has to be secured, and the needs of those employees affected and those who remain have to be considered. The complete report on the results is available free of charge via e-mail to info@stg-newplacement.de.
