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Managing Employee Separations | 15-1

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Dessler, Chhinzer, ColeHuman Resources

Management in CanadaCanadian Twelfth Edition

Chapter 15: Managing Employee Separations: Foundations of Employee Engagement,

Communication, and Turnover Management

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Managing Employee Separations | 15-2

Learning Outcomes

• DEFINE voluntary and involuntary turnover and explain the impact of each.

• DISCUSS the drivers and outcomes of each turnover method.

• ANALYZE important HR considerations in ensuring fairness in dismissals, layoffs, and terminations.

• DISCUSS the three foundations of a fair and just disciplinary process.

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Managing Employee Separations | 15-3

Learning Outcomes

• DEFINE wrongful dismissal and constructive dismissal.

• EXPLAIN the six steps in the termination interview.

• EXPLAIN various techniques for ensuring effective employee communication in organizations to help manage turnover.

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Managing Employee Separations | 15-4

Managing TurnoverVoluntary turnover:

• decision made by employee• quit• retirement• resignation

Involuntary turnover:

• decision made by employer• Dismissal• layoff

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Managing Employee Separations | 15-5

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Reasons for Turnover

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Managing Employee Separations | 15-6

The Cost of Turnover• separation costs

– separation interview, administration, separation or severance pay

• vacancy costs– temporary workers, overtime, loss of

sales due to vacancy• replacement costs

– recruiting/hiring replacement• training costs

– for replacement

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Managing Employee Separations | 15-7

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Direct Cost of Turnover

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Managing Employee Separations | 15-8

Voluntary Turnover

• unanticipated challenges of replacing employee

• reasons for voluntary turnover:– suboptimal hiring practices– difficult managerial style– lack of recognition– lack of competitive compensation

systems– toxic workplace environments

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Managing Employee Separations | 15-9

Involuntary Turnover

• reasons for involuntary turnover:– unacceptable job performance– economic/financial pressures– new strategic direction

• should be fair, after all reasonable steps taken to rehabilitate employment relationship

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Managing Employee Separations | 15-10

Fair and Just Disciplinary Process

Foundations:1. rules and regulations

– clear expectations of acceptable behaviour

2. progressive discipline– warning, suspension, termination

3. appeals process– allow employee to present case

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Managing Employee Separations | 15-11

Dismissal for Just Cause

• dismissal– involuntary termination of employment

• dismissal for just cause– termination based on poor behaviour– no severance or additional notice period

required• insubordination

– disregard or disobedience of authority– often provides grounds for just cause

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Managing Employee Separations | 15-12

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Guidelines for Insubordination

continued

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Managing Employee Separations | 15-13

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Guidelines for Insubordination

continued

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Managing Employee Separations | 15-14

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Guidelines for Insubordination

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Managing Employee Separations | 15-15

Layoff• temporary withdrawal of employment to

workers• conditions:

1. no work available2. situation expected to be temporary3. management intention to recall

employees• alternatives:

– pay reduction, use of vacation time, contingent workers, work sharing

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Managing Employee Separations | 15-16

Fairness in Employee Separations

• distributive justice – fairness of a decision outcome

• procedural justice – fairness of the process used to make a

decision• interactional justice

– fairness in interpersonal interactions by treating others with dignity and respect

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Managing Employee Separations | 15-17

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The Vendetta Effect

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Managing Employee Separations | 15-18

Employee-Employer Relationship• employment contract

– formal agreement between employer and employee

– employee cannot be prematurely dismissed without just cause if a term is specified

• implied contract– indefinite period of time, may be

terminated by either party with reasonable notice

– more common

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Managing Employee Separations | 15-19

Providing Reasonable Notice• required when terminating an employee if just

cause does not exist• considerations:

– rule of thumb is 3-4 weeks per year service– failure to provide notice may result in

wrongful dismissal– large group terminations require more

notice– avoid “bad faith conduct”– wrongful acts may result in punitive

damages

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Managing Employee Separations | 15-20

Constructive Dismissal

• employer makes unilateral changes in the employment contract that are unacceptable to the employee

• examples:– demotion– reduction in pay and benefits– forced resignation

• employee is eligible for reasonable notice

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Managing Employee Separations | 15-21

Avoiding Wrongful Dismissal Suits1. Use termination clause and probationary

period in employment contracts2. Document all disciplinary action3. Do not allege just cause for dismissal unless it

can be proven4. Time the termination so that it does not

conflict with special occasions5. Clearly state a settlement offer in writing6. Schedule the termination interview in a private

location at a discrete time of day7. Include two managers in the termination

meeting

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Managing Employee Separations | 15-22

The Termination Interview

1. Plan the interview 2. Get to the point3. Describe the situation briefly4. Listen5. Review all elements of the severance

package6. Identify the next step

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Managing Employee Separations | 15-23

Employee Engagement

• emotional and intellectual involvement of employees in their work

• creates vested interest in company’s success, willingness, and motivation to exceed job performance requirements

• effective communication is important to employee engagement

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Managing Employee Separations | 15-24

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Drivers of Engagement

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Managing Employee Separations | 15-25

Suggestion Programs

• offer rewards for employee suggestions on improvement

• benefits:– monitor employees feelings/concerns– provide alternate channel of

communication– minor employee issues can be addressed

early

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Managing Employee Separations | 15-26

Employee Opinion Surveys

• should be conducted regularly and communicated to employees

• address areas such as job satisfaction, co-worker cohesion, quality focus, employee commitment

• blogging is becoming more common; recommend a blogging policy to encourage but guide employees

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Managing Employee Separations | 15-27

Communication from Management

• share data on performance and operations prospects

• traditionally:- newsletters- verbal presentations

• more recently:– video, email, intrarnets– blogs from senior management