Companies are busy cutting their losses to mitigate the aftermath of Covid-19. This news about Uber is one of those examples. Firing through online conference call is harsh.
There are several strategies that companies can engage in to reduce their workforce surplus. The list below is organised from the speed in reducing costs (fast to slow) and the impact to human suffering (high to low).
- Pay reductions
- Hiring freeze
- Natural attrition
- Early retirement
- Retraining / Reskilling
Downsizing, while being the fastest strategy to reduce labor costs, results the most adverse consequences to employees. In other words, it is good for the companies but it is bad for the employees. If there are options, companies should address their surplus issue by implementing other strategies first before deciding on downsizing.
If downsizing is inevitable, then there are other good practices that HR can implement to ensure that the process is conducted properly to maintain employees dignity. I will cover this aspect in another post.