Employee Layoff Alternatives



Ineffective workforce planning, economic downturns, loss of sales and revenue: the issues that prompt employee layoffs are sometimes predictable and sometimes the result of poor planning. Employee layoffs can be toxic for the employees who remain and for the success of your organization. Employee layoff alternatives should be considered first. Find out more about employee layoff alternatives.



Before You Do a Workforce Reduction



Before you do a workforce reduction, you will want to consider other cost cutting options.



Hiring Freeze



in a hiring freeze, an employer decides to stop hiring employees for all non-essential positions. A hiring freeze allows an employer to consolidate current employees and potentially restructure departments, to complete the work that is essential for serving the customers of the business.



Temporary Employees



Temporary employees are hired to assist employers to meet business demands yet allow the employer to avoid the cost of hiring a regular employee. Sometimes, it is the expectation of the employer that if the temporary employee is successful, the temporary employee will be hired.



Work Sharing



Work sharing is an Unemployment Insurance (UI) program that allows an employer to reduce the number of hours an employee works during a week while unemployment compensation makes up some of the difference in income. So, if a company is experiencing less demand for its products and consequently fewer sales and down revenue, it can submit a plan requesting work sharing to UI to cushion the reduced hours for its employees.



Buyout



Buyouts are a common method for reducing the number and cost of employees. In a buyout, the employer offers some employees or all employees the opportunity to receive a large severance package in return for leaving their employment.



Employee Furlough



An employee furlough is mandatory time off work with no pay. Used as an alternative to a layoff, an employee furlough can occur in both public and private sector organizations when revenue or projected revenue fails to match expenses. Revenue is generated through product sales, grants, and governmental support and subsidies.



What Are the Advantages and Disadvantages of Employee Furloughs?



Furloughs are mandatory time off work with no pay. Generally implemented by employers as a cost saving measure, there are advantages and disadvantages to the use of furloughs as an alternative to layoffs. Find out more about furloughs.



Best Practices in Layoffs



Best practices in layoffs matter for the employees you lay off and the employees who survive the layoffs. Employee layoffs allow you to cut costs while preserving your relationship with your most critical employees. These are best practices of employers toward the employees they must lay off. Find out how to help the employees who survive the layoffs maintain positive morale and motivation.