LAY OFF [Sec 2 (kkk)]

Lay off means putting aside workmen temporarily.The duration of lay off should not be
for a period longer than the period of emergency.The employer-emplyee relationship
does not come to an end but is merely suspended during the period of emergency .
The following are salient features of lay off-

1. An employer, who is willing to employ, fails or refuses or is anable to provide

employment for reasons beyond his control.

2. Any such failure or refusal to employ a workmen may be on account of -

• Shortage of coal,power or raw-material or
• The accumulation of stock or
• Natural calamity or
• Any other connected reasons

3. A workman who is so deprived of employment must be such whose name is borne on the
muster rolls of his industrial establishment.

4. The workman must not have been retrenched.

Lay off is a measure to cope with the temporary inability of an employer to offer
employment to a worker and to keep the industrial establishment a going concern.
 Decisions involving the layoff
INTRODUCTION:-

Layoffs are normally considered terminations based on lack of work or capital, rather
than on poor employee performance. Layoffs are often temporary. They occur with the
expectation that workers will be hired back if and when they are needed.

When all workers are laid-off at the same time, there is little need to discuss seniority and
merit considerations. But when partial or gradual layoffs take place, difficult decisions
have to be made.

Non-seasonal personnel may well be the hardest or most heart wrenching labor
management decision you have to make. The expectation with year-round employment is
that workers will hold on to their positions as long as they do a good job and the
enterprise is economically viable.

Arguments that favor making layoffs in reverse order of seniority, that is, the
last hired, the first to go include:

(1) The longer employees have worked for a farm enterprise, the more loyalty they are
due. Other employees will observe and be affected by how senior employees are treated.

(2) Senior employees who lose their jobs may have greater difficulty finding another job
at the equivalent pay and benefit level than younger workers.

(3) Layoffs by merit may lead to age discrimination law suits if older workers are
disproportionately terminated.
The principal argument favoring merit to determine layoff decisions is:

(1) Management should retain the best people to do the job, especially when functioning
with fewer employees.

IN THE END Employers sometimes offer special retirement packages to entice more
senior personnel to retire. This is often done in an effort to save money. In agriculture it
is more often seasonal employees who are involved in layoff and rehire decisions. On the
other hand, "If an employer is often faced with the layoff problem, it is important to
select a policy that works best on a repeated basis. Changing recently established policies
would likely create doubt about fairness among the people adversely affected."

Some employers encourage the return of seasonal workers by staying in touch with them
during the off season. They may send cards to workers during down time or even offer
returning employees added pay. In this way they can create stability in their work force
and increase the number of experienced employees. The distinction between seasonal and
regular work force becomes less meaningful in such operations.

HOW TO LAY OFF THE EMPLOYEES:-

STEP 1:-Lay off employees with compassion –

The first rule in how to layoff employees is to terminate their employment with feeling if
you have to terminate their employment under harsh circumstances.
STEP 2:-Lay off legally –

Contracts with employees, national and state employment laws should be referred before
laying off employees legally. Some points to be considered while laying off legally:-

1.Consider the legal implications of laying off an employee - Some employees

might have legal reasons why they cannot be laid off or need extra warning or
benefits in doing so. These employees could include pregnant females, minorities,
disabled, etc. Speak to a lawyer to determine if any restrictions apply to your
company.

2. Consider the employee's general attitude - Most companies would agree that one
of the most important criteria for employee layoffs is the employee's attitude. This
includes the employee's work ethics, moral, flexibility, team playing skills, job
motivation, etc. An employee who is generally difficult to work with is often the first
to go. Not only is this employee not productive, but productivity of fellow workers
also slides when (s)he is around.

3. Consider the employee's usefulness - Unfortunately, some employees are more

useful than others. This could be because of job function (some functions are just less
useful in the company) or because of the worker's personality. Some workers are
more willing to take on additional tasks beyond their bare minimal job descriptions -
these employees will be especially useful after other workers are laid off.

4. Consider the employee's skills - Does this employee have skills that are unique or
does this employee have skills that are duplicated by many other staff members.

5. Consider the future of the company - Which projects is the company focusing on
now and in the future? Is the employee that you are considering laying off a main
player in one of the future projects or is (s)he mainly involved in a project that is
dying out? You may want to transfer important employees from one project to
another, but this consideration is still part of the criteria for employee lay off.

6. Consider the employee's pay in comparison to his/her usefulness - Is the

employee being overpaid relative to their amount of contribution? Some employees
are very talented and worth a lot of money, but they are not used to their full potential
and are therefore not worth their high pay. Other employees may be receiving a very
high pay but are a key employee in the company and are therefore worthwhile to keep
on.
 7. Consider when the employee was hired - Newly hired workers are often the first
to let go when company layoffs are performed because they have contributed the least
to the company and will be missed the least. However, criteria for company layoffs
should focus not just on newly hired workers, but on how long all workers have been
at the company. Ethically, some companies might want to keep on employees who
have been at the company many years because of the employees' contribution in the
early days and a feeling that laying them off would be a lack of gratitude. Although
years at the job is not the only criteria, this combined with other criteria is important
to consider.

8. Consider trade secrets an employee might have – Some employees are

valuable because they hold knowledge about your company or corporation. Some
are valuable because they have a unique skill that cannot be easily replaced.

STEP 3:-Give advance warning –

If company’s layoffs or corporate layoffs are eminent, the subtle hints in the office should
be delivered about the bad news, so that the employees can be mentally prepared.

STEP 4:-Be honest but not hurtful when telling your worker the bad news –

The worker's fault should be clear by laying him/her off but it should not be hurtful to
him/her.

STEP 5:-Give a good bye gift –

The laid off employee should be given a little good bye present or the party if the
company is very close.

STEP 6:-Give extra compensation –

If it’s possible, compensate the employee generously when it’s a company or corporate
layoff. Pay workers a little bit extra in their last pay check to help them out with the
beginning difficulties of their unemployment.

STEP 7:-Give advice for finding a new job –

The company should give advise to laid off employee and discuss their job options for a
new job. If possible, recommend to them several companies that might be looking for
employees with their qualifications.

STEP 8:-Write an honest but complimentary recommendation letter –

Give the laid off employee a detailed letter mentioning how much you appreciated them.
Include details about projects they worked on and how much they contributed. Make the
laid off worker feel special and important.

WHAT SHOULD EMPLOYEE DO WHEN HE RECEIVES A

NOTICE OF LAY

When a company is struggling financially its employees could face a layoff. Preparing for
a layoff may shorten the period of time when a employee will be unemployed. Here are
some steps which a employee can take to help keep a layoff from hitting him too hard:-
SeverancePackage:-

Severance package information including what's included in a severance package, typical

severance packages, and who may be entitled to severance package after a lay-off.

Filing for Unemployment:-

If a employee has been laid-off from his job he may be able to file for unemployment
online without visiting an unemployment office. he should file a claim as soon as he
receive lay-off notification. Here's he can have information on eligibility requirements,
disqualifications, where to file, how to file, benefits, rates, and answers to questions on
unemployment compensation.

Where to file a claim:- A employee should file his unemployment claim with the state
where he worked. If he worked in a state other than the one where he live or worked in
multiple states, the state unemployment office where he now live can provide information
about how to file the claim with other states.

Employee Benefits After a employee Lose his Job:-

The employment related benefits should be find out when he resign, get fired, or get laid-
off from his job like information on unemployment, severance packages, giving notice,
health insurance, retirement plans, workers compensation, disability, references and more
resources.

Employee Rights After a Layoff:-

It's important to know about the rights as an employee are when he lose his job.

Layoff Checklist

When you have lost your job, it's important to check on compensation due, benefits,
references, and unemployment. Review this checklist to make sure that everything is
covered, then focus on the job search.

Losing your job can be hard, especially when the economy is bad, but a negative attitude
will only hurt the chances of finding a new job. Don't let the fear and desperation of
losing the job and its financial security bring a employee down. A career coach offers
three tips for surviving a layoff and finding a new job.

• Try to cope with the loss of your job, keeping your self esteem intact
• When at the receiving end, at least bargain for the best possible severance
package
 • The best way to survive a layoff is to make job-hunting your new job

No compensation shall be paid to a workman who has been laid- off—

(i) If he refuses to accept any alternative employment in the same establishment from
which he has been laid- off, or in any other establishment belonging to the same
employer situate in the same town or village or situate within a radius of five miles from
the establishment to which he belongs, if, in the opinion of the employer, such alternative
employment does not call for any special skill or previous experience and can be done by
the workman, provided that the wages which would normally have been paid to the
workman are offered for the alternative employment also;

(ii) If he does not present himself for work at the establishment at the appointed time
during normal working hours at least once a day;

(iii) If such laying- off is due to a strike or slowing- down of production on the part of
workmen in another part of the establishment.

SUGGESTIONS TO AVOID LAY OFF

1. Arrive at least 5 minutes early. When you are going to be late, be sure to notify your
boss. There is no excuse in this age of technology not to let the company know. Being
late more than 2 times a year is questionable. You will need to apologize for your
tardiness and offer to make up the missed time.
2. You have sick time available, of course use it if you must. If you have not used much
time, and your company as a "use it or loose it" policy, use some of it, but not all of it.
Even if other employees use all their time, you will need to have a better attendance
record. A boss notices absenteeism.

3. Mind your own business. Do not mind other employees and the company's business.
You may believe that other workers are getting away with situations, but in the end you
may find that they aren't. The company doesn't appreciate your opinions. Taking care of
yourself is a big undertaking, but if you mind yourself you will do a fine job.

4. Do your job; do it well go above and beyond what is being asked of you. Stay late,
work extra, do everything you can to make yourself valuable and indespensible.

5. Maintain good working relationships. Be sure to meet everyone in your building,

and keep a warm and friendly persona. It may pay off at a company-cut board meeting if
you have made a strong, positive impression on your coworkers and supervisors

6. Stay informed about your industry. Is your occupation in demand, or is it cutting

back and tapering off? If you see that people in a job similar to yours are rapidly being
laid off, take action and start looking into other careers that utilize skills similar to your
own.

7. Be aware that a layoff can happen to you; in this economy, almost no one's job is
entirely secure. Keeping your head in sand about it wont help, but in the same respect, try
and not stress too severely over it. If your employer is reducing it's workforce due to the
economy, there is not always a lot you can do about it. But you do have options and you
can protect yourself in the case of a layoff. If you foresee unemployment, start saving
your paychecks, and looking into other job opportunities.

8. Emergency fund on hand: This emergency fund should cover three to six months of
your expenses. It takes most people between three to six months to find a job. Even if you
do not have the entire amount saved when you lose your job, you will be able to make
your severance and any other unemployment stretch much farther because you have
saved that money. It will also help to protect any money that you have saved for
retirement.
9. Build your resume. In case you find yourself strapped with the stress of being laid off,
take the time now to create a resume that accurately portrays your strengths and skills.
Along with having back up savings and job options, you should consider asking your
current employer for a letter of recommendation

10. Make your daily budgets:- It is important to make a commitment to follow a budget
every month, and to make every effort to get out of debt. You should also carefully
consider any loans that you take out, and what would happen if you were not able to pay
them back. If you were to lose your job and you were already on a budget, it is much
easier to see what you will need to change to keep your finances under control while you
look for a new job.

ADVANTAGES AND DISADVANTAGES OF LAY OFF

There are many merits and demerits of layoff . The main advantages are as follows.:-

Severance benefits:-

Laid off employees are offered various severance payment or package containing several
months of salary plus pay for unused vacation time.

.Bonus:-

Bonus are paid to employees to leave the job.

Cash payments:-

Cash payments are given to employees who agree to resign themselves.

Career management:-

Employee can change employers &career paths.

Transfer pricing and international profit Analysis:-

Lay off helps to determine the transfer prices and international profit of various
companies

Importance for companies:-

By laying off fresh blood can be infused in the organization.

Innovation:-

Laying off is very helpful in innovation because new employees has new ideas that brings
benefit for the company.
 DISADVANTAGES OF LAYOFF
The main disadvantages of layoff are as follows:-

No severance benefit

The main disadvantage of lay off is that no severance benefit will be there if there is no
lay off.

Increase of unemployment:

With increase in layoff the rate of unemployment is also increasing.

Lead to frustration:

Lay off increase the frustration between the employees which is injuries for their health.

Loss of skilled manpower:

The company lose their skilled and experienced employees with lay offs.

Problem in re-employment:

The company may face the problem while recruiting the other employee because he may
be a fresher or less-experienced.
 Conclusion

In the end we can say that Lay off is justified up to some extent. For the company its
good because it brings new innovation and new ideas for the company and its beneficial
for employees because it brings new opportunities for them. It also provide severance
benefits to them. Lay off is not justified because it is difficult for the company to recruit
new experienced and skilled employees and for the employees its difficult to find a new
job in a particular period of time. So, we can say that the company should avoid layoffs
and the employees should perform best for the company so that the layoffs can be
avoided to great extent.

PROJECT REPORT ON
Submitted to:- Submitted by:-
Ms. POOJA Saakshi
BBA DEPTT. BBA 3rd year
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