The business case for Outplacement

Lets talk about the number of cases in every 1,000 – relax I am not talking about the rate of Covid within your tier, but I am talking about something just as serious, the number of redundancies per 1,000 thousand employees in the UK for the quarter August to October 2020 stood at 13.3!

In the calendar year to November 2020 the number of roles in the UK economy has shrunk by 819,000 whilst unemployment rates have risen to 4.9% of working population with an estimate 370,000 redundancies in the quarter to October 2020.

Whilst businesses clearly planned for the end of the furlough period (end of October) the continued impact of coronavirus into 2021 will see a continued downsizing of workforces across the UK.

So why then is it important for firms to provide support to those they lay off?

The answer lies fundamentally on the type of employer you aspire or have become and the negative impact that can be caused by failing to show support.

A badly managed process with little regard for loyal employees who typically do not cause the downturn in business (especially true in Covid times) will damage your employer brand resulting in; local bad press, less staff referrals, and less likelihood of those prized assets returning to the business at a later more positive time.  The difficulties your staff have in finding their next roles will play back on you, their past employer, whilst those staff remaining are likely to suffer survivor syndrome;

Survivor syndrome is when those staff remaining start to reflect on the process and or support their colleagues have received.  One way to ensure those remaining want to be a part of your Organisation moving forward, is to treat departing colleagues with respect and to show that you care about their careers even if you cannot retain them at this time.

A proven method to achieve this is an outplacement program but the perception of these services is often that they are expensive.  Lets then take a look at an example case of Susan;

Susan is aged 40 and has 5 years service earning  £30k per year and given the news she was dreading (but expected) she will be paid statutory redundancy plus notice.  The total cost of that individual leaving the business will be £2,690 redundancy and £2,884 notice (assuming notice not worked and statutory notice used). So a total of £5,574.

In those 5 years Susan will have built up good relations and probably in better times meets some of her colleagues outside of the business for social events.  In 6 months from now if Susan were to still be unemployed the feeling from those colleagues still at work toward the company that made her redundant could be mixed.  

Susan could instead be offered a suitable outplacement package – not because of her seniority as some businesses desire but because they care about her.  For a cost of £1,000 Susan would receive coaching, workshops on; networking, applying, cv writing and be offered 121 interview practice.

Just imagine the good news story when Susan lands that role 3 months later and her friends at her former company get to hear.