With job losses of nearly one lakh in last quarter of 2022 and first three months of 2023 in major tech giants globally, it is enough to scare and create a turmoil for HR Function. It is unpleasant, depressing and demoralizing for working people at large, spreading insecurity and creating a negative work environment, posing a survival question of whether I would be next? Though the major job loss has been in west, but it has impacted the tech companies and startups in India also.
Major job loss, which is commonly termed as layoff in business world happened in tech giants and Edtech sector, the reasons of which may be different for individual organization, has ultimately sparked a debate on the leadership ability, wisdom and vision as to why the things were not foreseen and preventive actions were taken to avoid such situation or resorting to abrupt mass layoff is the result of pressing the panic button without assessing the ground reality assuming a threat of global recession because in many tech companies and Edtech startups hirings continued till few months before resorting to downsizing.
Whatever may be the case, it is the HR in the center, who has to execute the infamous task and that too with care and compassion. It is the HR whose strategies and actions in such bad times have the greatest impact on the organisations. His task in each downsizing exercise is to cut direct operating cost which is about people and retain the talent and keep them engaged. Successful implementation of downsizing is a big task for any HR professional in his career. One point can be raised here. Whether the other options of indirect cost cutting have been considered and implemented? Whether the HR is involved in decision making of downsizing or he is simply asked to execute the decision of layoff at the first instance to maintain the profit margins and reduce operating costs? Because there has been no such study in sight to indicate that layoffs have improved the organisation’s effectiveness and created a competitive edge in their favour. Rather there have been indications that after layoffs, the organisations face the brand crisis, increased employee dissatisfaction and disengagement, low morale and increased attrition of talent. This results in further hiring on higher cost with lagging in skills that are required to take on the job immediately.
Cover story of this issue is on possible impact of Layoffs in India, HR Role in executing it if unavoidable, making it less painful as far as possible and insulating the orgainsation from possible legal threats arising out of such action. The industry HR experts have discussed the nuances of this critical phenomenon and ways to act upon in preventive as well as curative mode.