15 October 2009

Pinto's Points

RIFs, layoffs, cutbacks: Do's and don'ts

By Jim Pinto

Just recently, I saw the HBO documentary: "The Last Truck – Closing of a GM plant." GM employees who had been with the company for 20 to 30 years sadly followed the last truck as it rolled down the assembly line. Reactions ranged from philosophical to sentimental; many could not speak as they became overwhelmed by tears.

The late-1950s bestseller, William H. Whyte’s Organization Man described General Motors. People not only worked for the organization but sold their psyches as well. They willingly subordinated their personal goals and desires to conform to the demands of the corporation. Half-century later, here was the demise of GM, the model company Whyte’s book was describing.

During these recessionary times, big layoffs seem to be the only solution to our economic woes. Already many states have unemployment rates of more than 10%, and the national average is creeping up to that level.

There are several expressions used to make the nasty job of layoffs more palatable—cutbacks, downsizing, reduction-in-force (RIF). Consider this: When your colleague is RIF’d, it is a recession; when YOU are RIF’d it is a depression.

Most employees who are let-go are given “the standard company severance package.” In the U.S., it is usually a week per year of service. In Europe, it is much more difficult (and expensive) to layoff anyone who has been employed for a few years.

There are strict laws involved, usually covered by making exiting employees sign a document waiving any further claims before they receive their final check. Under these difficult circumstances, few have the knowledge or the fortitude to really read the document; many simply sign away their rights in order to accept immediate payment. Most companies tread the fine line between decency and legality in the layoff process. It is tough for everyone—the company, the exiting employees, and the ones remaining.

Here is my own list of Do’s and Don’ts for laid off employees:

• Don’t take it personally. 
• Don’t blame anyone.
• Don’t simply look for another similar job, at a similar pay.
• Do your best to stay positive.
• Do use this opportunity to re-educate and modernize yourself.
• Do find something you enjoy; hey, maybe start your own business.

Here is my advice. Being laid off could be the step that pushed you into something you will enjoy much more. Develop a NEW YOU – Version 2.0. You might end up with an occupation that is much better than anything you thought possible.

My mother told me long ago: “People like to do what they’re good at, and are good at what they like to do.” Find something you are good at, and you will like doing it.

Related links

• RIF or Layoff: What Difference Does it Make?
  http://labor-employment-law.lawyers.com/RIF-or-Layoff-What-Difference-Does-it-Make-.html
• How Is Severance Pay Determined?
  http://www.allbusiness.com/human-resources/workforce-management-termination/947-1.html
• The Days the Plant Died – Closing of a GM Plant:
  http://www.nytimes.com/2009/09/07/arts/television/07truck.html
• Pinto’s Points – 10 steps to finding the right job:
  http://www.isa.org/intechnews.cfm?id=7666

Behind the byline

Jim Pinto is an industry analyst and founder of Action Instruments. You can e-mail him at jim@jimpinto.com or view his writings at www.JimPinto.com. Read the Table of Contents of his book, Pinto’s Points, at www.jimpinto.com/writings/points.html.