Holiday Layoffs - Why?

Unfortunately, payroll managment is harder than it sounds.  It's usually one of the only costs that management has control over.  Taxes, rent, utilities, maintenance, and to some degree product replacement are fixed costs that can't go unpaid.  Back in my retail management days, payroll was limited to a percentage of revenue and we were not allowed to go over without authorization.  When revenue dropped, payroll had to drop.

I doubt very much that layoffs will impress shareholders.  It will probably have the opposite effect and raise a lot of troubling questions - Why is revenue down? Why is production down? Why are sales down? Why is market share down? These are the stressors negatively impacting the enterprise.  I see layoffs as a big part of a business death spiral.  

Glamdring

As one who has seen this firsthand this week, it is all about the year end budget and needing to impress the stake holders with the year end number projections for 2021.  The staff is just the easiest way to find the savings to reach the expectation.  The holidays unfortunately just fall in Q4 as well. 

The way I see it, you the long tenured staff in December, give them a severance based on state laws, then you can always hire someone new within a couple months for less play and PTO accrual if conditions stabilize and the rest of the staff hasn't already successfully absorbed the duties.

I'm not one of these dopes who think the business money just grows on trees or is made by magic, but I think it is also foolish to be performing across the board staff cuts and include the profitable units of a company in the cuts as well.  The old story killing the golden goose and all...

But I wholeheardely agree with Bill that the most wretched thing to do is shine the staff that all is doing just fine with the company, then on 12/1 spring a bunch of layoffs on everyone.  That is exactly what our CEO had been doing since July, then the managers wonder why we say we don't trust them.

But that is just my

 

That activity is just horrible.

it's not normal.

As one who has seen this firsthand this week, it is all about the year end budget and needing to impress the stake holders with the year end number projections for 2021.  The staff is just the easiest way to find the savings to reach the expectation.  The holidays unfortunately just fall in Q4 as well. 

The way I see it, you the long tenured staff in December, give them a severance based on state laws, then you can always hire someone new within a couple months for less play and PTO accrual if conditions stabilize and the rest of the staff hasn't already successfully absorbed the duties.

I'm not one of these dopes who think the business money just grows on trees or is made by magic, but I think it is also foolish to be performing across the board staff cuts and include the profitable units of a company in the cuts as well.  The old story killing the golden goose and all...

But I wholeheardely agree with Bill that the most wretched thing to do is shine the staff that all is doing just fine with the company, then on 12/1 spring a bunch of layoffs on everyone.  That is exactly what our CEO had been doing since July, then the managers wonder why we say we don't trust them.

But that is just my

Greg

I'm with Brandon and Bill.

That said, I know you mean well and your heart is in the right place, TB. You always do and it always is, that is a happy constant around here.

I wasn't going to say this but since Bill already did, I was a business owner too. So many of these godforsaken business slowdowns happed abruptly.......in November. To this day I don't undertand the timing, must have happened 4-6 times in 40+ yrs.

And my gut wrenches right this moment just thinking about it.

 

I work in a factory, General Electric Appliances in Louisville. Normally, we have senior workers who block off vacation days in December and the company also has their week long vacation shutdown bracketing the Christmas and New Year's holidays.

Since we make money per unit, when we are short handed, we only make like 500 units a shift instead of 750 (for example) that makes the profit per unit too low so it's better to shutdown than to lose money while making fewer units.

Workers without vacation days available are allowed to apply for unemployment as well as receive a union negotiated Income Extension Aid (an amount added to your weekly unemployment benefit that bumps you up to almost your regular take home pay).

Some workers with a habit of calling in (thus accumulating attendance points), often get let go at the end of the year due to excessive absences. We have a 7-point system, where seven unexcused absences in a year will result in a firing. It normally takes about 20+ points, meaning the person has missed over 20 days of work, before getting fired at the end of the year.

Our company pays for two weeks of vacation (10 days, 15 days if you have over 5 years), 12 paid holidays, three personal days and allows for various numbers of days off if a relative dies, birth or adoption of a child, etc. Bottom line, a person with less than 5 years has 25 paid days off a year, plus the ability to "earn" seven attendance points, or 32 total days off per year. And they sitll get fired for missing work.

I'm with Brandon and Bill.

That said, I know you mean well and your heart is in the right place, TB. You always do and it always is, that is a happy constant around here.

I wasn't going to say this but since Bill already did, I was a business owner too. So many of these godforsaken business slowdowns happed abruptly.......in November. To this day I don't undertand the timing, must have happened 4-6 times in 40+ yrs.

And my gut wrenches right this moment just thinking about it.

I gave my opinion on another thread which is this:

As an employer I've faced this before. If it's inevitable it's not fair to let someone put a dent in their savings (EDIT: or flog their credit cards ) for the holidays and not to get ahead of the pack looking for work Before the new year.

Bill

It's all dollars and cents. Plain and simple. Businesses are being crushed by the lack of customers for many reasons and the time of the year doesn't stop the bleeding. In order to stay out of bankruptcy they have to bandage as quickly as possilbe. Sad part is, wait till 2021, you haven't seen anything yet. 

BK