It is that time of year. We have just announced record profits and signed off mega-bonuses for the senior team, and yet we are now told we must rationalise the business to remain competitive, which is code for: we must let go of a bunch of people. It is all top secret, so you did not hear it from me, and the direction coming from our friends in the US who like nothing better than a little decluttering of the workforce every now and then.
American employment contracts refer to employment ‘at will’, which basically means when your employer says walk, you just empty your locker and go. We make people redundant almost every year, and yet the US still forgets that European employment legislation is much more protective, and that an employer must go through a charade of consulting with workers and trying to find alternative roles, before they can tell someone to walk.
Headcount reductions
This year’s tidy-up includes revisiting grading for some senior roles too. Senior grades come with higher bonuses and enhanced benefits, so the great thinking is this: if you can downgrade some of the senior folks, you can save some money without getting rid of them. Maybe in the US you can just decide to demote someone, but not here. Unfortunately, our European HR director is also American, so even she does not get it. Big Bad Boss has had to get our lawyers to put the European rules in writing so that the Higher Beings, our senior leadership team, do not do anything stupid. With great power comes great potential for legislative error.
Naturally everyone in HR and most of the Higher Beings are aware of what is going on. It makes us all jumpy and on edge. Will they reduce our team? Will they want to get rid of me? I have heard a quote about having nothing in your house that is not beautiful or useful. On that basis, my colleague Lazy Susan should be the first in the ‘let go’ pile. I doubt it will happen though; she is curiously bullet-proof. It may be because she does so very little and has such minimal impact, there is nothing for anyone to criticise. She is also cheap.
Redundancy cost calculations
There are lists being drawn up. The Higher Beings, running scared, are even more inclined to puff themselves up and run each other down. It is getting rather ugly. As usual, I get asked to summarise the contractual and statutory redundancy terms for all European countries, and to brush off my spreadsheet to calculate the cost of laying people off. Unlike other years, I am not being asked to complete it, which means I do not get to see the employees impacted. That has me even more worried; it might mean that I am on the list myself. I then hear they have asked Lazy Susan for advice on including allowances in the Netherlands. Naturally she does not know and must ask me. Exclude me at your peril, I think,
Finally, Big Bad Boss sends me the final list to check which is a massive relief as my name does not appear. Or could he have just deleted my row first? Am I just being paranoid or is he acting a bit cooler with me now? I wish we could get this thing over with, so we all relax. I mean relax as in dealing with the normal level of stress, because it is never relaxing as such here.
The good news is the clueless European HRD is on the to-go list along with one of the other particularly difficult Higher Beings. I am pleased but also curious because both were flavour of the month only a few months ago, having been feted with special bonuses and an above guideline pay rise. Perhaps, that is what made them too expensive. There is a lot to be said for staying in the middle of the pay range out of scrutiny.
Whoever took my spreadsheet has made a complete mess of it. For a start, they have deleted payments for bonus and benefits accrued during the contractual notice period, and they have ignored the particularly complicated legal requirements in Germany, copying formulas directly across from the UK. They have also included the unconverted USD equity amounts, summing them incorrectly in the local currency total.
Sensitive conversations
Eventually, all consultations and legal processes are complete. I do not envy our HR business partners in this. We cannot trust our managers to handle anything remotely sensitive, so HR holds the meetings with people being laid off, trotting out the same old reassurances and corporate excuses to each person or group. It must be awful to be the face of the hatchet in that way. That is why I work in reward; we rarely deal with conflict.
Then comes the daily email telling us about yet another leader who has decided to pursue other opportunities which is another way of saying they will be working with an outplacement consultant to find another role with immediate effect. For Higher Beings, the emails also congratulate the leader on their incredible contribution and impact on the organisation. Really? Luckily, most leavers get their system access taken away before the emails go out, so they do not have the salt of hypocrisy rubbed in the wound.
Lazy Susan, Big Bad Boss and I survived another cull. The leaner organisation chart has been amended for a fresh start. I could have guessed what would happen next: a slew of new hiring requests including two for Higher Beings. Job titles have been subtly amended to give the appearance of new roles but make no mistake, they are replacements for the two just let go. This is the cycle of corporate life.
Next time…Candid attempts networking
