COVID19: Staffing and Layoffs

Shared Economy
JSP Consulting
January 3, 2021

One characteristic of the COVID-19 times is the lack of orders and the associated layoffs.

Laying off employees is a quick and simple way to solve cost-saving issues. In large companies, there are usually redundancies that adhere the following arbitrary guideline – all departments must reduce the number of employees by 10% – regardless of the actual needs of the department. Dismissal is not a cheap process, recruitment is even more expensive, and, unfortunately, all work experience, contacts, and know-how are lost in many cases. We have, of course, temporary assistance from the state here in the form of the so-called Kurzarbeit. But is there another alternative solution to this problem?

Sometimes it is better to reassign employees to another department or reduce their salary and/or workload. Another excellent solution is to temporarily rent employees out to another company in the same area. No, it is not an entirely crazy idea. Remember, not all sectors have been affected in the same way. Some companies are still looking for skilled and less-qualified employees for temporary or more permanent help.

In the employee rental scenario, the rented employees remain on the payrolls of the source companies. The employee does not lose his or her job, goes to work in approximately the same place, and is still a regular employee of his or her company. After the crisis, he or she returns to their company, eliminating the expensive recruitment of a new employee.

There is another problem in the area of ​​human resources. Although companies publish a list of internal positions on their intranet, HR departments do not have an overview of employees who would like to work in another position, in another department, in another branch, or outside their home country. In most instances, this crucial information is not shared with other HR departments. This lack of information-sharing also contributes to the fact that these employees prefer to look for work outside their company. This often happens in companies where employees have only one one-on-one discussion about their promotion, their plans, work issues, or new ideas per year.

Please get in touch with me if your company faces similar issues.


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