Reducing staff levels: inherent dangers of losing loyalty

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By: Wise Marketer Staff |

Posted on October 5, 2001

Reducing staff levels: inherent dangers of losing loyalty

It all depends on how you do it; it can make a massive difference. American Airways is one company that seems to have got it right.

Many employers have been faced with the painful task of reducing staff levels over the last few months, and it seems as if there are still plenty more to come. At the best of times, it is difficult but, when the labour market is contracting as quickly as it is now, it is even more so.

Sympathetic and honest It is clearly of paramount importance to handle lay-offs in the most sympathetic, tactful way. Many employees who have been laid off have understood the reason why and would have accepted their fate as sad but unavoidable. But because of the way the matter was handled, they have left full of resentment and anger. To find out that you have been made redundant by reading a press report, or by receiving an impersonal memo, cannot be a pleasant experience. In fact, industry sources estimate that only about one percent of laid-off employees retaliate in some way, but this rises to some 5% if the matter is badly handled. Many of those who have retaliated have claimed that, had they been told face-to-face by a respected executive, they would not have been angry. And of course, it's not only those who have been laid off who need to be treated well: after badly handled mass lay-offs there is quite often a considerable sympathetic reaction from those who weren't laid off, and sometimes even covert sabotage of systems and processes. And clearly, the electronic workplace has made this much easier and more tempting.

American Airlines American Airlines is one company that has done its best to lessen the pain for the some 20,000 employees that it has to release. It is offering special payments, medical benefits, travel privileges, free career development classes, a variety of job and personal support resources, and the ability to stay in touch with the company through a special internet-based programme.

And what's more, American is providing practical assistance in finding other employment. A company web site will provide tools to showcase employees' talents and experience to other employers. American will offer free access to career development, financial management and other classes at American's Flagship University, and also offer a wide range of financial, lifestyle, education and other resources through LifeBalance, American's life resources programme.

American's chairman and CEO, Don Carty, says that he is especially grateful that other local employers have pledged to help those who had lost their jobs. "Almost immediately after we announced the need to reduce our staff, we received calls from other companies asking us to refer our employees to their recruitment people. That support from our communities means a great deal," Carty said.

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