Layoffs from the Employer Perspective – Only the Strong Survive

Last week we talked about those with their head in the sand or hiding to avoid change or even layoffs.  This week it’s a little more serious as we are going to talk about some of the challenges around layoffs for companies.layoff

In the U.S. most of us are “at will” employees that can be terminated for any reason.  In other countries, such as Germany, the rules are different.  It’s not as easy to dismiss employees.  The companies are making a long term investment in the individuals and if results are not expected, the companies work with the employee to improve those results.

Today we have high unemployment, yet companies claim it is even more challenging to find the high quality employees or long term employees they need.  Some are moving away from the “at will” employment model.  I believe that is a double edge sword.  In the U.S., we (the people) are not always accountable for our actions.  We are a litigious society.  The removal of the “at will” provides a level of security in uncertain economic times and makes the employer more desirable.  However, it may also incent employees to provide the minimal acceptable behavior, taking advantage of the lack of the “at will”.  This happens today, as many employees already are doing the minimum and yet still expect to be promoted and receive raises, etc.  They are surprised when these things don’t happen and take no accountability for the fact that the delivered 15 hours of effort over a total of a 35 hour work week.

Companies tend to use “at will” to purge the weak and meet stakeholder expectations – Jack Welch had a vitality model known as a “20-70-10” system. The “top 20” percent of the workforce is most productive, and 70% (the “vital 70”) work adequately. The other 10% (“bottom 10”) are nonproducers and should be fired.  This was probably part of the inspiration for Bryan Adams’ late eighties song that states:

“Only the strong survive

Well I’m doin’ what I can – you gotta understand

Only the strong survive”

In reality, companies should work to provide a supportive environment to allow for success. However, companies must also be productive and profitable (otherwise they go out of business and cease all employment).  So there is a fine line of balance between providing a supportive environment for employees success and termination of employees “at will” when times get tough or production is not met.

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1 Response to Layoffs from the Employer Perspective – Only the Strong Survive

  1. Jim Riviello says:

    A very important topic in our “me, me” society…while we can all learn from Germany, there is a reason GE was so profitable during the Jack Welsh era.

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