I work at a small company and I lead a sales team of 10 people.
Generally we all work well together. But our business has taken a hit and the CEO has asked every division to cut our budgets – including reducing staff by 20 per cent. That means I have to fire two of my staffers.
One guy isn’t the best performer, when compared with the others so that’s a relatively easy decision.
However, I have to decide who else to cut; they’re all good, no one stands out as not pulling their weight. How do I do this?
We’re in a smaller city and most of us have families to support. This is eating me up. I know this is part of being the leader of a team but I need some help.
We’ve already cut our other budgets to the bone. Any advice?
THE FIRST ANSWER
Greg Conner, human resources executive, Victoria
There is no such thing as a 100-per-cent retention rate. Over time, we all leave jobs, for various reasons – a new opportunity, a spouse transferred, going back to school, and so on.
I suggest that you offer what is known as a “voluntary departure incentive” as a way of facilitating the departure of someone who may be contemplating leaving or who would leave if the right inducement were in place. This is not an expensive solution, as you would already have to pay severance if you lay off someone. This makes it possible to use that money in a more strategic and humane way.
If that does not work, make your decision based on performance data alone, not by trying to make a determination based on age, family status, or other attributes you think are “fair,” because I guarantee you that this type of qualitative decision is impossible to explain or defend.
THE SECOND ANSWER
Gina Ibghy, chief people officer at Randstad Canada, Toronto
Business decisions are hard to make, but that’s why you are the boss. You get paid to handle these challenge, but that doesn’t make it any easier.
The fairest way to do this is by performance metrics and seniority.
There are specific labour standards about dismissal; it is important that your company provide the two people who are leaving with ample notice and severance that is in line with your industry’s standard or exceeds them.
The difficulty of a 20-per-cent cut to your staffing budget is that it doesn’t necessarily reduce the amount of work that your unit will have to complete. Your CEO is asking your team to do more with less, and while you may live in a small community, people have an intriguing ability to find, or make, their own opportunities.
As much as I’d worry about the impact these layoffs will have on those who are laid off, I’d be more worried about the impact they’ll have on the people you are keeping.
Additional responsibilities, changes in work flow or additional training will add to the work stress of your remaining team members. Ensuring you have an efficient succession plan will help to prevent further losses in your team after these two have been let go.
What you don’t want, after you have performed these business-critical layoffs, is to have more staff leave in the coming months, leaving you extremely short staffed and forcing the remaining members of your team to be extremely overworked. Hiring and training new team members has its own costs.
Provide those you are planning to let go with strong references, think through your network for other opportunities you could connect them to, and inform them of the availability of employment insurance and other regional retraining or support programs.
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