Redundancies are never easy for the people who are going or for those left behind. But try to get them over and done with too quickly and HR could be putting its own head on the block, as Louise Druce finds out.

No matter how hard you try to put a positive spin on it, the task of culling the workforce is an unenviable one. But how HR handles collective redundancy can make all the difference to morale and motivation, on both sides of the fence.

Communication is key. As with any shake-up in an organisation, once the cat is out the bag, the rumour mill will pick up pace, making it hard for employees to determine what’s really going on. And if HR isn’t forthcoming with reassurance, the impact on productivity and costs can be devastating.

The most obvious solution would be to try to avoid redundancies in the first place, something not as cavalier as it sounds. Angela Baron, advisor, organisation and resourcing at the Chartered Institute of Personnel and Development (CIPD), believes that far too often, companies may think redundancies are a cost-saving exercise without really having done the maths.

For example, the Learning and Skills Council has spent a whopping £54.4 million on redundancies over the past six years. And that’s just the monetary costs. “Companies look at cost savings in terms of what they are going to save on the wage bill but they don’t calculate the true cost in terms of loss of talent, loss of performance and the loss of the willingness to innovate,” says Baron.

“You need to look at more flexible ways you can resource your organisation to minimise the need for redundancies – planning ahead and looking at how you can cope with the peaks and troughs and downturn; looking at ways to develop the capacity of your workforce to be flexible to business changes. If you have a strategy and constantly develop people in this way, redundancy is a situation you shouldn’t have to get into.”

The last resort

If redundancy really is the only option, there are official procedures that need to be followed. In the case of collective redundancies, where 20 or more people are dismissed within a 90-day period, they can only be carried out after a consultation process.

First of all, notification must be given to the Secretary of State for Business, Enterprise and Regulatory Reform at least 90 days before the redundancy date or companies could face a £5000 fine. Employers must also disclose in writing information such as the reason for the redundancies, the number of staff involved, the proposed redundancy selection method, the period over which it will happen and how the redundancy package is being calculated.

Consultations must then take place with trade union or employee representatives, as well as with the employees the company is proposing to make redundant, to discuss ways of avoiding the dismissals or reducing the number of people being made redundant, and the reasons why this course of action is being taken.

“It can’t just be lip service, it has to be meaningful,” cautions Baron. “You have to make sure the criteria for selecting people for redundancy is fair and look at what you are offering them or you could end up in court for unfair dismissal.

“The temptation may be to get people out the door as quickly as possible but how you treat the people being made redundant will have an effect on the people left behind.”

Olwyn Burgess, director of client services at HR consultancy Chiumento, agrees, citing an example she experienced when two organisations merged. The duplication of roles meant it was harder to choose who would stay and who would go. To make the process fair, the HR team and line managers determined which jobs would still be needed and then selected who would fill those roles using competency based interviews.

“HR needs to look at the ability of line managers and the HR team to manage the whole process of outplacement. Have they got the skills and experience? Who will be giving the bad news? What support do they need?,” she adds.

“The line managers may be affected themselves and still have to manage their people through a massive change for up to a year. Up-skilling managers is important to deal with the change and how to identify individuals in the team who may be feeling a bit wobbly to make sure they get support.”

Survival skills

Redundancy doesn’t just affect the people leaving the company. Those left behind can often suffer from ‘survivor syndrome’, where they feel guilty that they have kept their jobs. They need just as much support as their colleagues who are being made redundant.

The same is also true for HR professionals, who may be brought down by having to constantly play the bad guy.

Workshops are one way to give the people being made redundant the skills they need to find new jobs and also teach the remaining workforce how they can deal with the changes. Other companies have found it easier to bring in outside help to lend an impartial ear to those affected and help deal impartially with the process.

“It’s a bit like a bereavement,” says Burgess. “You might be feeling really bad but some people might be happy they are going. Don’t reflect your guilt or unhappiness on others or treat them like a pariah. They really need good ideas, motivation, a sounding board.

“The other immediate impact on people when they see colleagues leaving is they automatically think it will mean more work for them. You need to have good performance management conversations about what their role will look like in the future, what they might have to absorb, how they might have to do things differently,” she adds.

“As long as you keep people informed and consult them, they feel better and more in control readapting to the new future.”