20 October 2015

5 tips on managing restructures

A business restructures a strategy for achieving efficiencies, increasing profitability or to adapt to a changing market. Here are 5 tips for achieving a smooth restructure as far as employees are concerned.

1.  Have a plan

Ask yourself:

  • What are the main objectives of the restructure?
  • Do any positions need to be made redundant to achieve this? 
  • How long will the process take? 
  • How will you communicate this to staff?
  • What risks are associated with the process?

A clear strategy will help the restructure proceed smoothly

2.  Know your industrial agreement

Make sure you are aware of the National Employment Standards as well as any modern awards, enterprise agreements or contracts that apply to your employees. These will detail any redeployment, consultation, notice and/or severance pay obligations. 

3.  Last employee hired is not necessarily the first to be fired

Selecting employees for redundancy must be based on fair and unbiased selection criteria that is clearly communicated and transparent to staff. You should consider the skills, knowledge and experience necessary to meet the operational requirements of the business in detailing such criteria.

4.  The position is redundant not the person

A redundancy is only genuine when an employer no longer requires a person’s job to be performed by anyone because of the operational requirements of the business. If you terminate an employee’s employment for redundancy and then employ another person in the same role, the redundancy can be challenged.

5.  Communication is key

Communicating effectively with your employees and other stakeholders is essential in protecting against claims and important in keeping the business productive and viable during what is often a time of uncertainty and change.

Employees should be made aware of the plan and timing of the restructure; this will dispel rumours and assist them to remain positive and productive.

Posted in Legal Advice & Consulting.
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