It’s a scary fact: The economy’s forcing many companies to reduce their workforces. Most HR managers don’t want to think about letting people go, but careful planning will help employers avoid bias claims from employees looking for a big payday.
A recent court case provides an example of how to reduce staff and avoid lawsuits:
Three women sued after losing their jobs in a company-wide reduction-in-force (RIF) targeting front-line managers.
The women were all over 40 years old, as were 14 out of the 19 terminated managers.
Also, before the RIF, 19 managers were female and 83 were male. Ten women (52% of all female managers) were laid off, compared to 11 men (13% of all males).
According to the women, those facts showed that the RIF targeted older, female employees.
Not necessarily, the court ruled.
Statistics like those don’t prove discrimination. The company can still show employees were chosen for the reduction based on consistent, non-biased criteria.
Fair and consistent decisions
In this case, the company did just that. Here’s an overview of the RIF plan:
First, the company grouped the managers by location and figured out which areas could be handled by fewer people. Then, they were placed into three tiers based on their most recent performance reviews.
Employees in the lowest performing tier were then ranked against each other. Their supervisors were all given the same set of criteria to complete the evaluation. The lowest-ranked employees on that list were terminated.
Long story short, the terminated employees were chosen based strictly on performance — not age or gender. The case was thrown out.
Some more keys to avoiding discrimination suits after layoffs:
- Document the planning — Before any individual employees are considered, write down the reasons the RIF is needed, which departments/locations will be targeted and how employees will be selected.
- Be consistent — If the focus is on performance, managers should do more than come up with a subjective list of who they think their best employees are. Supervisors should be given a list of factors to consider so that all employees are rated the same way.
- Don’t make exceptions — Managers may argue to keep or get rid of certain employees, regardless of the planned method’s results. But, as the court noted in the case above, selectively applying the RIF criteria may leave the company open to bias charges.
Cite: Sanders v. Southwestern Bell