KEY POINTS:
There comes a time in every manager's life when you have to bite the bullet and make some redundancies. You could even argue that you aren't a fully fledged manager until you have been through this. But who wants to see staff breaking down in tears as they worry about their employment prospects?
Experts say the most important thing is to treat your staff like human beings _ that is, treat them the way you would like to be treated. You would want to be well informed and convinced that the redundancy was not because of anything you had done. That it was not personal and that in better times you would be welcome at the company again.
Easier said than done. David Lowe, employment services manager for the Employers and Manufacturers Association, Northern (EMA), is one of those people used to making others redundant. It's a necessary ingredient of change management, his area of expertise.
Lowe says: "It does test you as a human being and as a manager. If you are able to bring your organisation through it then you will have successfully helped the needs of the business."
Lowe has spent the past few weeks talking to 2500 business owners and managers about redundancy procedures.
It's a subject close to their hearts at the moment. Lowe says the HR departments of large companies also consult the EMA in times like these because they don't handle redundancy often enough to become experts at it.
He and his team are going to Australia next week to brief businesses with offices in New Zealand about the correct procedures here.
"I know from first-hand experience that it's very difficult on the manager and business owner. It does not matter how big your company is.
"In a smaller company you might have lunch with them every day.
You will get bad reactions."
Rule number one, he warns, is to make sure that the redundancy is being made for genuine reasons, and that it's not a pre-existing situation that the manager is trying to "dress up".
For example, where an employee has had performance issues that the manager has let slide and is now trying to resolve by using the economic conditions as a justification.
Redundancy should be the last option, says Lowe. Most businesses will hang on to their staff for as long as they can. They may think: "This is just a cycle we are going through, we don't want to lay off staff only to discover that in a short time that we need them again."
Lowe says: "The process by which you work through the situation and come out at the end of it is very important."
Management should have three meetings with the group selected for possible redundancy.
In the first, explain the problem and what you propose to do.
At the second meeting, the employer has to listen to the employee, who has an opportunity to say: "This is what I think about your proposal." This is when employees might suggest taking another job in the company, working part time or any other ideas they might have.
Meeting three is to advise the staff that, having listened to everything that they have said, this is what I, the manager, have decided to do. At this meeting the employee has the right to have representation with them.
"What the people that you are talking to want to know is some certainty about their future. Rather than saying to them what you think they want to hear, the warm fuzzies, what they really want to know is, `Do I have a job or don't I?"'
There's no doubt that, however well it's done, staff being made redundant feel a sense of betrayal.
Jude Manuel, business development director at DBM, the career transition services company, says:
"Managers need to reinforce the company values of treating employees with dignity and respect, conduct concise, factual, compassionate (but not emotional) meetings and minimise negative impact on the business."
The people left behind also have to be looked after.
Paul Bell, director of HR consultancy Fanselow Bell, says: "When there is a call for redundancies and you have a staff of 500, 500 people get unsettled. You need to treat those who are leaving well so that those people who are staying still have positive feelings about the employer they are working for."
Making redundancies can be depressing for the manager too. Business New Zealand chief executive Phil O'Reilly says: "It's OK to be scared, to feel a little bit concerned, because redundancies are not common. Many employers get very worried that it's their fault. But a financial crisis came along, it's nobody's fault, it's just a case of getting on with it ...
"The most important thing is to treat your employees as human beings. If you explain the state of the company to them, give them the opportunity to respond, they will try and come to the party.
"I have been involved in thousands of redundancies _ and the ones that have gone best, the company has been open and honest upfront."
It's when there is a lack of clarity and fear follows that things go wrong.
Gill South is a freelance business writer based in Auckland
