Reorganisation: what you need to pay attention to as management/HR

Because of COVID19 and the elimination of the fine on dismissal from 1 June 2020, reorganisations will become the new reality. In the event of a reorganisation, which HR aspects do you have to pay attention to as a management/HR? In this blog I will discuss the most important HR aspects that are relevant for a successful reorganisation.

You can’t just have a look at the financial aspects of a reorganisation. Then you run the risk that after the reorganisation there will be an organisation that is completely hollowed out in terms of personnel, has insufficient productivity and cannot deliver to your customers what they want.

It is very important to pay attention to this, because this is exactly what customers fear in the event of a reorganisation. They wonder what the impact of the reorganisation will be on them and will look critically at whether they still want to do business with your organisation after the reorganisation or prefer to switch to a competitor who has not carried out a reorganisation or who has tackled this in a better way.

That is why I will set out below the most important HR aspects that you, as management/HR should pay attention to in the event of a reorganisation.

For the sake of completeness, I note that a reorganisation does not have to be accompanied by dismissals. After all, reorganisation means nothing more and nothing less than redesigning your organisation. That can be with fewer jobs, but also – in case of growth – with more jobs.

However, practice has shown that reorganisation involves often redundancies. In general, not only the organisation changes, but also the functions change. The current employees are not always suitable for the new positions. On top of that, in connection with COVID 19, fewer jobs are needed within many organisations. A large part of the HR aspects, which you have to pay attention to as a management/HR in case of a reorganisation, is therefore related to dismissal.

Retain your best employees

In the case of reorganisations, the principle of seniority applies. This means that, within certain age cohorts, you will have to dismiss the employee who was last employed in the position in question first. This does not seem to offer the possibility to keep your best employees, but if you handle this well, the seniority principle does not have to be an obstacle to keep your best employees.

After all, you are redesigning your organisation. In general, this means new tasks and therefore new positions. Of course, you let them fit in with your wishes of a new organisation. Of course, this will have to be done in such a way that it results in a workable situation, because otherwise you will have a problem with your production and with your customers.

It is important to retain your best employees, because they are most likely able to cope with the changed situation after the reorganisation. After all, the range of tasks generally changes as a result of a reorganisation, as explained above. The employees who remain will need to be able to carry out this new package of tasks properly. Otherwise you run the risk of needing another reorganisation.

A new position also offers the opportunity to determine a new remuneration. This can result in an employee earning more or less. In any case, an appropriate remuneration will have to be determined for each new position. A remuneration that fits the range of tasks and – if there is one – the function building.

Take good care of employees who are dismissed

It is important to take good care of the employees who are dismissed. They have made an effort for the organisation. Sometimes for many years. Moreover, they remain ambassadors of your organisation. You have to take that into account.

The employees are in any case entitled to a transition allowance. It is advisable to offer a budget for outplacement in addition to or instead of this. Especially in the current era. After all, it will generally not be easy for employees who are made redundant to find another job quickly. A budget for outplacement is then very helpful.

If a budget for outplacement is chosen, give the employee the opportunity to not only spend it on outplacement. Give the employee the opportunity to use the budget in addition to outplacement for training and any form of career guidance that can help in finding and keeping another job.

Also help the employee with the selection of a party where he or she can place the outplacement. After all, there is a big difference between the various parties. For example, it strikes me that many parties involved in outplacement stop their efforts as soon as another job is found. Regardless of whether – given the budget – there are still hours left.

It is not logical to choose a party that then stops the efforts. You would be doing the dismissed employee a disservice. If there are hours left, they can be used for follow-up work. For example, in the outplacement that I provide with my firm, I use it for onboarding at the new employer. After all, this increases the chance of a successful and sustainable career and that’s what it’s all about.

It is also important to choose a party that does not work with minimal personal contacts. There are various outplacement parties that only have one or two personal contacts with the employee who is looking for another job and do everything else via classes and online. My experience is that it works much better to have intensive personal contact with an employee looking for another job.

Think of the impact on the stayers

During a reorganisation, a lot of attention is often paid to the employees who are dismissed. That is understandable and also very good. They are confronted with a particularly unpleasant situation. A lot of attention will have to be paid to them.

However, the employees who are allowed to stay should not be lost sight of either. Although the situation is not as unpleasant for them as it is for the employees who are dismissed, they too are confronted with an unpleasant situation.

Suddenly they will have to move on without one or more dear colleagues. The impact of this is great. Moreover, that impact is also felt by the organisation. After all, this concerns employees who stay. If they become less productive and/or less motivated, you will notice that. It is therefore important to pay attention to the impact that the reorganisation has on the employees who are allowed to stay.

This is particularly true at the moment. After all, many employees now work from home. This applies both to employees who are allowed to stay and to employees who are dismissed. As a result, it is not possible to say goodbye, as would normally be possible.

Moreover, a farewell drink is not an option either. At least, not in the way this was possible when there was no COVID19.

Management/HR should pay attention to the impact on the stayers. One way of doing this is by giving them a realistic package of tasks. You also do this by taking good care of the employees who are dismissed. After all, there is a good chance that one or more of the stayers will keep in touch with them.

If the employees who are dismissed, for example, receive an outplacement budget and thus quickly find another job, this will not go unnoticed by the stayers. This gives a much better feeling than an ex-colleague who may be unemployed for years and is very disappointed.

Furthermore, being aware of the impact on the stayers means that you are aware of the fact that these employees may be afraid of being fired in the long run. You will have to take that fear away as much as possible.

You can do this, for example, by means of a loyalty programme. A programme that shows that you are investing in your staff. For example, by offering them training or special sessions with external guidance. Incompany or outside the organisation. As management, you can also show your face more often and express your appreciation. That too is a form of reward.

Be aware of mistrust

If you carry out a reorganisation as management/HR, you generally create mistrust. The employees who are allowed to stay, will continue to associate you as management /HR with the reorganisation.

That is why it may be advisable not to carry out the reorganisation as management/HR yourself, but to have this done by an external party. Then you will not be the face of the reorganisation. You will be at a greater distance from it. The party carrying out the reorganisation becomes the face of it.

Assistance with reorganisation

Are you, as management/HR, forced to carry out a reorganisation and can you use help with that? Would you like to be guided in the background, for example, on matters such as how – despite the seniority principle – you can retain your best employees? Or do you want to hand over the reorganisation (almost) completely, so that you do not become the face of the reorganisation?

Together with my strategic alliance partner Ilma van Aalst of employment law firm 7 Laws of Persuasion, I can help you implement a reorganisation.

We can supervise the reorganisation in the background or (almost) completely take over, so that we become the face of the reorganisation. If we are not the face of the reorganisation, I could provide outplacement to employees who are dismissed. I guide many employees from work to work or from unemployment to work. Over the past ten years that has proved successful.

Unlike many other agencies that provide outplacement, my work does not stop when another job has been found. If there is any budget left, I also supervise onboarding at the new employer.

Furthermore, I have intensive personal contact with the employees who are looking for another job.

Are you interested in my help and/or Ilma’s help with your reorganisation? Call me free of charge and without obligation on 010-8485750.