EMPLOYEE SEPARATION AND

RETENTION MANAGEMENT

Employee
Employee Separation
Separation
Reasons
Reasons for
for employee
employee separations
separations

Pressures
Pressureson
onfirms
firmstotoremain
remaincompetitive
competitive&&efficient
efficient
Decline
Declineininemployee
employeecommitment
commitmenttotoemployers
employers

Importance
Importance of
of managing
managing separations
separations

Transitions
Transitionsofofemployees
employeesout
outofoffirm
firmgo
gosmoothly
smoothly
Continuing
Continuingoperations
operationsofoffirm
firmnot
notdisrupted
disrupted
Important
Importantprofessional
professionalrelationships
relationshipsnot
notdamaged
damaged

Types
Types of
of separations
separations

Reductions-in-force,
Reductions-in-force,turnover,
turnover,&&retirements
retirements

Reductions-in-Force
Reductions-in-Force (RIFs)
(RIFs)
Causes
Causes of
of reductions
reductions

Restructuring
Restructuringas
asaaresult
resultofofmergers
mergers&&acquisitions
acquisitions
Attempts
Attemptstotomake
makeorganization
organizationmore
morecost
costcompetitive
competitive
Adjustments
Adjustmentstotodeclining
decliningbusiness
businessenvironment
environmentconditions
conditions

Reasons
Reasons for
for reductions
reductions

Inefficiency
Inefficiencyininoperations
operations
Lack
Lackofofadaptability
adaptabilityininmarketplace
marketplace
Weakened
Weakenedcompetitive
competitiveposition
positionininindustry
industry

Methods
Methods for
for dealing
dealing with
with reductions
reductions

Continuance
Continuancepay
pay&&outplacement
outplacementprograms
programs

Reductions-in-Force
Reductions-in-Force (RIFs)
(RIFs)
Worker
WorkerAdjustment
Adjustment Retraining
Retraining &
& Notification
NotificationAct
Act
(WARN)
(WARN) of
of 1989
1989
Requires
Requiresemployers
employerswith
withmore
morethan
than100
100employees
employeestoto
provide
providesixty
sixtydays
dayswritten
writtennotice
noticeofofany
anyfacility
facilityclosings
closingsoror
large-scale
large-scalelayoffs
layoffsofof50
50orormore
moreemployees
employees
WARN
WARNdoes
doesno
noapply
applytotogovernmental
governmentalagencies
agencies
Exceptions
ExceptionstotoWARN
WARN
Faltering
Falteringcompany
company
Unforeseeable
Unforeseeablecircumstance
circumstance
Natural
Naturaldisaster
disaster
Temporary
Temporaryfacility
facility

Workforce
Workforce Management
Management Strategies
Strategies

Turnover
Turnover
Involuntary
Involuntary turnover
turnover
Employees
Employeesasked
askedtotoleave
leaveorganization
organizationfor
forcause
causeor
or
due
duetotocircumstances
circumstancesthat
thatcause
causereduction-in-force
reduction-in-force

Voluntary
Voluntary turnover
turnover
Employees
Employeeswho
wholeave
leaveorganization
organizationon
onown
owninitiative
initiative

Beneficial
Beneficial turnover
turnover
Low
Lowperforming
performingemployees
employeesdepart
depart&/or
&/ornew
newhigher
higher
performing
performingemployees
employeespromoted
promotedor
orhired
hiredas
as
replacements
replacements

Exhibit
Exhibit13.2
13.2

Performance-Replaceability
Performance-Replaceability Strategy
Strategy
Matrix
Matrix

Exhibit
Exhibit13.3
13.3

Strategic
Strategic Management
Management of
of Turnover
Turnover &
&
Retention
Retention

Retention
Retention of
of High
High Performers
Performers
Critical
Critical HR
HR issue
issue
Development
Development ofof policies
policies && programs
programs toto retain
retain
high
high performers
performers &/or
&/or those
those difficult
difficult toto replace
replace

Employers
Employers face
face competition
competition from
from
Other
Other organizations
organizations
From
From employees
employees they
they are
are attempting
attempting toto retain
retain
(to
(to start-ups)
start-ups)

Retirement
Retirement
Age
Age Discrimination
DiscriminationAct
Act of
of 1967
1967

Prohibits
Prohibitsemployer
employerfrom
fromsetting
settingmandatory
mandatoryretirement
retirementage
age
except
exceptinincertain
certainoccupations
occupations(e.g.
(e.g.pilots)
pilots)

Retirement
Retirement

Creates
Createsadvancement
advancementopportunities
opportunitiesfor
foryounger
youngeremployees
employees
&&reduces
reducespayroll
payrollcosts
costs
Can
Cancause
causeloss
lossofofvital
vitalhistorical
historicalknowledge
knowledgeofoforganization,
organization,
industry
industry&&marketplace
marketplace
Part-time
Part-time&&consulting
consultingwork
workcan
canease
easetransition
transitionofofolder
older
workers
workersinto
intoretirement
retirement

Reading
Reading13.1
13.1

Cost
Cost Reductions,
Reductions, Downsizing-related
Downsizing-related
Layoffs,
Layoffs, and
and HR
HR Practices
Practices
reduction-in-force
reduction-in-force(RIF)
(RIF)activities
activitiesrarely
rarelyreturn
returnthe
theanticipated
anticipatedeconomic
economicand
and
organizational
organizationalgains
gains
more
moreso,
so,there
thereisisincreased
increasedunderstanding
understandingand
andawareness
awarenessthat
thatdownsized
downsized
companies
companiesare
areforced
forcedtotodeal
dealwith
withthe
thehuman
humanand
andsocietal
societalafter-effects,
after-effects,also
also
known
knownasassecondary
secondaryeffects,
effects,ininaapost-downsizing
post-downsizingphase
phase
the
thehuman
humanconsequences
consequencesofoflayoffs
layoffsare
arecostly
costlyand
anddevastating
devastatingfor
forindividuals,
individuals,
their
theirfamilies,
families,and
andentire
entirecommunities.
communities.
while
whileworkforce
workforcereductions
reductionscannot
cannotalways
alwaysbe
becompletely
completelyavoided,
avoided,
downsizing-related
downsizing-relatedlayoffs
layoffsmust
mustbe
beaamanagerial
managerialtool
toolof
ofabsolute
absolutelast
lastrather
rather
than
thanfirst
firstresort
resort
during
duringan
aneconomic
economicdownturn,
downturn,aacompany
companymust
mustcarefully
carefullyconsider
considerits
itsoptions
options
and
andassess
assessthe
thefeasibility
feasibilityand
andapplicability
applicabilityof
ofcost-reduction
cost-reductionalternatives
alternativesprior
prior
totoadopting
adoptingRIF-related
RIF-relatedlayoffs
layoffs

Reading
Reading13.1
13.1

Cost
Cost Reductions,
Reductions, Downsizing-related
Downsizing-related
Layoffs,
Layoffs, and
and HR
HR Practices
Practices
Organizations
Organizations can
canminimize,
minimize,defer
defer or
or avoid
avoid
reductions-in-force,
reductions-in-force, layoffs
layoffs or
or downsizing
downsizing through
through
the
the implementation
implementation of
of strategic
strategic cost-reduction
cost-reduction
strategies
strategies
Options
Options are
are available
available which
which relate
relate to
to short,
short,
medium
mediumand
and long-range
long-range cost
cost adjustments
adjustments

Reading
Reading13.1
13.1

Cost
Cost Reductions,
Reductions, Downsizing-related
Downsizing-related
Layoffs,
Layoffs, and
and HR
HR Practices
Practices
Short-term
Short-termadjustments
adjustments
hiring
hiring freeze
freeze
mandatory
mandatory vacation
vacation
reduced
reduced workweek
workweek
cut
cut in
in overtime
overtime
salary
salary reduction
reduction
temporary
temporary facility
facility shutdown
shutdown
soliciting
soliciting cost
cost reduction
reduction ideas
ideas from
fromemployees
employees

Reading
Reading13.1
13.1

Cost
Cost Reductions,
Reductions, Downsizing-related
Downsizing-related
Layoffs,
Layoffs, and
and HR
HR Practices
Practices
Medium-tern
Medium-tern adjustments
adjustments
extended
extended salary
salary reduction
reduction
voluntary
voluntary sabbaticals
sabbaticals
employee
employee lending
lending
exit
exit incentives
incentives

Reading
Reading13.1
13.1

Cost
Cost Reductions,
Reductions, Downsizing-related
Downsizing-related
Layoffs,
Layoffs, and
and HR
HR Practices
Practices
Long-term
Long-termadjustments
adjustments
rehiring
rehiring bonuses
bonuses
maintaining
maintaining communication
communication with
with layoffs
layoffs
internal
internal job
job fairs
fairs
hiring
hiring new
new talent
talent (after
(after economic
economic bounceback)
bounceback)

Reading
Reading 13.2
13.2
Knowledge
Knowledge Management
Management Among
Among the
the Older
Older
Workforce
Workforce
organizations
organizationsneed
needtotohave
haveaawell-planned
well-plannedstrategic
strategicmeans
meansof
oftransferring
transferring
knowledge
knowledgefrom
fromretiring
retiringbaby
babyboomers
boomerstotomembers
membersof
ofyounger
younger
generations
generations
assumptions
assumptionsthat
thatsenior
seniorworkers
workerswere
wereproblematic
problematicfor
fororganizations
organizationsare
are
not
notvalid,
valid,as
asresearch
researchshows
showsthat
thatsenior
seniorworkers
workers
have
havelow
lowturnover
turnoverrates
rates
are
areflexible
flexibleand
andopen
opentotochange
change
possess
possessup-to-date
up-to-dateskills
skills
are
areinterested
interestedininlearning
learningnew
newtasks
tasks
have
havelow
lowabsentee
absenteerates
rates
have
havefew
fewon-the-job
on-the-jobaccidents
accidents

Reading
Reading 13.2
13.2
Knowledge
Knowledge Management
Management Among
Among the
the Older
Older
Workforce
Workforce

senior
senior workers
workers also
also contribute
contribute responsibility
responsibility and
and
maturity,
maturity,commitment
commitment to
to their
their work,
work,experience
experience
and
and loyalty
loyalty
senior
senior workers
workers should
should 1)
1) be
be encouraged
encouraged to
to remain
remain
in
in the
the workforce
workforce as
as their
their positive
positive contributions
contributions
continue
continue and
and 2)
2) work
work more
more closely
closely with
with younger
younger
workers
workers to
to facilitate
facilitate knowledge
knowledge transfer
transfer

Reading
Reading 13.2
13.2
Knowledge
Knowledge Management
Management Among
Among the
the Older
Older
Workforce
Workforce

Five
Fivecritical
critical success
success factors
factors relate
relate to
to knowledge
knowledge
transfer
transfer
1.
1. Coaching
Coaching leadership
leadership style
style
2.
2. Structure,
Structure, roles,
roles, and
and responsibilities
responsibilities
3.
3. Emphasis
Emphasis on
on learning
learning and
and education
education
4.
4.Attention
Attention to
to motivation,
motivation, trust,
trust, reward
reward and
and
recognition
recognition
5.
5. Establishing
Establishing the
the right
right culture
culture

Reading
Reading13.3
13.3
Managing
ManagingOlder
OlderWorker
WorkerExit
Exitand
andRe-entry
Re-entryPractices:
Practices:AARevolving
Revolving
Door?
Door?
older
olderworkers,
workers,iningeneral,
general,find
findititharder
hardertotoget
getand
andkeep
keepjobs,
jobs,suffer
sufferfrom
fromage
age
discrimination
discriminationwhile
whileatatwork
workand
andare
areoften
oftenthe
thevictims
victimsofofworkplace
workplaceexclusion
exclusion
many
manyolder
olderworkers
workershave
havehad
hadchildren
childrenlater
laterininlife
lifeand/or
and/orare
aretaking
takingcare
careofof
their
theirparents
parentswho
whoare
areliving
livinglonger
longer
asasaaresult,
result,older
olderworkers
workersstill
stillhave
havesignificant
significantfinancial
financialresponsibilities
responsibilitiestotoand
and
for
others
in
their
later
years
for others in their later years
atatthe
thesame
sametime,
time,work
workprovides
providesmany
manynon-financial
non-financialbenefits
benefitsincluding
including
enhanced
enhancedself-esteem
self-esteemand
andself-worth
self-worth
once
oncean
anolder
olderindividual
individualleaves
leavesthe
theworkforce,
workforce,re-entry
re-entryisisexceedingly
exceedinglydifficult
difficult

Reading
Reading13.3
13.3
Managing
ManagingOlder
OlderWorker
WorkerExit
Exitand
andRe-entry
Re-entryPractices:
Practices:AARevolving
Revolving
Door?
Door?

Interviews
Interviewswith
withthe
thesubjects
subjectsof
ofthis
thisstudy
studyrevealed
revealedthat
that
flexible
flexibleworking
workingarrangements
arrangementswere
wereconsidered
consideredvery
very
desirable
desirable
age
agewas
wasreported
reportedas
asthe
themost
mostcommon
commoncause
causeof
of
participants
participantsleaving
leavingthe
theworkforce
workforce
age
agewas
wasreported
reportedas
asaabarrier
barrierto
tore-entry
re-entryto
towork
work
working
workingwith
withaateam
teamand
andother
othersocial
socialaspects
aspectsof
ofwork
workwere
were
seen
seenas
asattractive
attractive
the
thequalified
qualifiedparticipants
participantswanted
wantedto
tocontinue
continueworking
working
self-worth
self-worthand
andjob
jobsatisfaction
satisfactionwere
wereimportant
importantto
toolder
older
people
people

Reading
Reading13.3
13.3
Managing
ManagingOlder
OlderWorker
WorkerExit
Exitand
andRe-entry
Re-entryPractices:
Practices:AARevolving
Revolving
Door?
Door?

Organizations
Organizations can
can consider
consider re-entry
re-entry of
of retired
retired
employees,
employees, including
including on
on part-time,
part-time, contract,
contract,
project
project or
or seasonal
seasonal bases,
bases, as
as aa valuable
valuable
source
source of
of knowledgeable,
knowledgeable, motivated
motivated
employees
employees