The COVID-19 outbreak is threatening to severely impact businesses across the UK. For businesses, startups and SMEs, the effects could be disastrous. As schools, universities and businesses across the world close in an attempt to stop the spread of the virus, the threat of job cuts is becoming a realistic fear. There could be a severe economic impact, as illustrated by the latest report by the OECD warning that the COVID-19 outbreak could cut global economic growth from 2.9% in 2019 to 2.4%.

Even in a healthy economy, businesses operate under tight margins. In light of this new economic pressure, as well as the practical impact of the crisis (workplace closures, event cancellations and more), these small and medium businesses may be forced to commit to letting staff go in order to stay afloat. 

However, improper management of these types of decisions can cost a business their reputation. In trying times like these, it is imperative that businesses follow certain steps to avoid reputational damage. 

Communication 

Open and transparent internal communication is the starting point. Should an employee read online gossip or rumours relating to job cuts, a sense of resentment and being left in the dark is likely to set in. Even if they are not being affected by the cut, keeping major business developments like these a secret shows a lack of respect towards employees. Business leaders should be holding general meetings and announcement meetings outlining the likelihood of job losses, and the projected next steps. 

Clear timelines on cuts

Line managers should be having one-on-one conversations with staff, whether they are at risk of being affected by the job cuts or not. These meetings should clearly indicate timelines for these job cuts, should they go ahead, and what preparations are being made. Employers must be considerate of those who will be seeking new positions elsewhere, and how job cuts might affect them personally as well as professionally. An employee, given the tools to aid their own personal development, is less likely to leave an organisation harbouring negative feelings, even in the event they have been let go. 

Transparency 

When job cuts are looming, uncertainty and financial worry are generally the top concerns among employees. businesses should work with their business leaders and financial advisers, and be upfront with staff from the start. This will provide a sense of security and help them plan accordingly. Leaving employees high and dry is a sure way to detrimentally affect a company’s reputation, and could spell disaster for recruitment in the future.

Exit interviews

Exit interviews are an essential but often overlooked area of HR management. These interviews provide insight into how a brand is perceived, and gives employees the platform to communicate openly on their role and the company. In a time of extensive job cuts, an employee being heard can go a long way towards positive association with the brand. Further to this, should an employee have ill feelings, this gives employers an opportunity to act and rectify any issues within a team or company. These are all opportunities to strengthen the brand moving forward, and ensure that the next generation of employees have a positive experience. 

References

A good reference process can greatly help employees transition into a new role and leave them with a more positive feeling towards their previous company, even if they were made redundant. In this case, employers should clearly outline the company’s reference process from the first meeting, to avoid any confusion or back and forth down the line. Former employees getting in touch seeking a reference weeks or months after they have left is a time-consuming and avoidable burden. 

Know the legal side 

Whether employers have in-house counsel, an employment law adviser or the services of the workplace commission, it is vital to be up to date on all policies and legalities around redundancy. Depending on the years of service, staff will be due differing redundancy payment. All relevant legal documents should be available from the first meeting, with the legal implications clearly outlined. Doing this from the outset will avoid any future legal issues with employees who felt their legal rights weren’t met.  

Meanwhile, for businesses who are not forced to make drastic cuts, the COVID-19 outbreak could represent an opportunity for reflection. There are certain steps an entrepreneur can take in order to future proof their business so they can avoid job cuts. 

Hire for soft skills 

Consider the adaptability of employees and how they can grow within the company, should a digital transformation take place. When recruiting, think about the future now. Look at plans for the next year through to the next decade, and look at the potential digital disruption and transformation that may be required, along with the potential automation of some roles. Create recruitment plans and hiring requirements with this in mind, ensuring a future-forward workforce

Recruit sideways 

Don’t underestimate current staff. Of course, some redundancies are unavoidable due to finances, but consider that although someone might be working in sales, they may have a technical degree which they may be interested in pursuing. Carry out data research on current staff and hold career progression planning meetings, encouraging staff to outline future plans and potential opportunities.