Advanced Planning Can Be Key to Managing Layoffs Properly

By Andrew Glincher Office Managing Partner, Nixon Peabody LLP | October 28, 2008

Layoffs are always painful, but experienced managers have learned that they are sometimes necessary to protect the long-term viability of the business. Making these situations even more difficult is the possibility that laid off employees - who may be hurt and angry - will argue that they have been victims of discrimination.

Perhaps, for example, you come to the conclusion that what's most rationale from a business point of view is to reduce the number of housekeepers you employ. However, the housekeeping staff is overwhelmingly made up of women. Can a group of them be terminated, if it results in a disparate statistical impact on the number of women you employ? What if there are several housekeepers who have been at the hotel for years and are older than most of their coworkers - but they also happen to be the least effective, most problematic members of the staff? Can they be terminated while younger, less experienced employees keep their jobs?

How do you prevent this type of difficult situation from leading to litigation?

Of course, if the hotel is staffed by union employees, the method for implementing layoffs will be covered in the collective bargaining agreement. However, for others, management needs to have systems in place at the outset and on an ongoing basis that protect against unwarranted claims.

Setting up an evaluation process and maintaining personnel files is a critical first step. Employees should be evaluated regularly by supervisors based on a standard set of performance criteria. And supervisors should discuss these evaluations with the employees to ensure that there is no misunderstanding about any deficiencies.

If a housekeeper is terminated after being at the hotel for a long time, she might claim she has been a victim of age discrimination, especially if younger, less experienced workers were allowed to keep their jobs. Having properly documented employee performance issues as well as regular evaluations, showing that she had been one of the most poorly performing housekeepers at the hotel, would help defend against such a claim.

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