Reduction in Force (Employee Separations)
Corporate leaders must always carefully evaluate how their company is organized to meet goals and objectives. This requires some organizations to get lean and stay lean; and how they often do this is with a Reduction in Force. Reductions in Force, normally referred to as layoffs, are temporary suspensions or permanent terminations of employees. Reductions in force result from management deeming a particular position no longer necessary or by budgetary strains during an economic downturn or interruption of work.
There are several forms of Reductions in Force:
- RIF: The general term and abbreviation for a reduction in force. Its cause could be anything from cost-cutting measures or simply not enough work for employees.
- IRIF: An Involuntary Reduction in Force usually refers to an employee not choosing to leave the company, but is asked to leave because the company is going through lay offs or has fired the employee.
- VRIF: A Voluntary Reduction in Force occurs when an employee intended to leave the company either through retirement or resignation. An organization can pressure an employee to leave on his or her own to avoid a bitter firing situation.
- Employers can also issue an eRIF (layoffs through an email) or a WFR (simple abbreviation for workforce reduction.)
No matter the reason behind employee separations, since 2008 over 2.6 million U.S. jobs have been cut and no doubt there are more in the works. It is vital that companies carefully plan and document their decision-making processes and employee records to avoid costly litigation.
There are several laws that employers must be aware of during a Reduction in Force.
- COBRA: Requires certain employers to continue healthcare group coverage for employees who would have lost coverage after being laid off.
- Family and Medical Leave Act: Employees under this act can be protected from losing their jobs only if the employer can show that they would have lost their job regardless of the leave.
- Uniformed Services Employment and Reemployment Rights Act: Requires employers to reinstate employees returning from serving in the military.
- Discrimination Laws: Protect workers from disparate treatment in a Reduction in Force.
- Worker Adjustment and Retraining Notification Act: Requires employers to give at least 60-day notice of mass layoffs (i.e. more than 100 employees being laid off).