I was made redundant from my first job after leaving college. I'd been computerizing an engineering firm that specialized in heavy-duty crushing equipment for coal fired power stations around the world. In the early 1980s the market collapsed and so did my job. I was only 22. The next week I started up my first computer firm.
Firms don't like making people redundant any more than the people who are being made redundant. If you have to make someone redundant, it is extremely important that you let them know how sorry you are and do everything you reasonably can to help them. Try to take into account other considerations, such as whether they are the sole breadwinner in the household, have children, or have taken on increased financial commitments. Make sure you take the following steps:
♦ Give them as much advance warning as possible.
♦ Have the conversation face to face—don't let them find out by note or hearsay.
♦ Write them the best reference you can.
♦ Phone your friends and peers to see if they have any vacancies. Make them aware of the person's abilities.
♦ Offer to screen their resume. Make sure that it is of the highest quality.
♦ Give them realistic severance pay to enable them time and support to get another job.
♦ Never do this during the holiday season at the end of the year. Forewarn them that tough decisions might have to be made in the New Year.
Keep in mind that your remaining staff will find it very hard to stomach if you make three $40,000 staff members redundant claiming reduced sales when the next set of accounts shows that the CEO has voted himself a $500,000 increase or the rest of the firm is being flown to Las Vegas for a holiday party. Those who remain will probably say nothing to your face; they'll just start looking around for a more equitable employer. Injustice cannot be disguised.
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