What is outplacement and why should employers consider it?

By 08/04/2020 April 9th, 2020 Uncategorized

The term ‘outplacement’ was coined back in 1977 by James Challenger, founder of Chicago-based firm Challenger, Gray and Christmas.

In short, outplacement is a way for employers to support employees that are leaving. Often provided to employees that have been affected by redundancy, outplacement services can also support those that are retiring, starting their own business or simply moving on to pastures new.

While there is no legal obligation to provide outplacement, many employers offer employees a range of support that will help them to navigate the job market and find a new role as quickly as possible.

Outplacement can be delivered internally by the departing employee’s organisation, by an external organisation or a combination of both. For many businesses, outplacement is a crucial part of an employee’s lifecycle and ensures any employee that is leaving feels well supported as they progress to the next stage in their career.

As part of outplacement, employees will benefit from a vast range of support from their employer that will help them to navigate the job market and find a new role as quickly as possible.

The format of outplacement can involve one-to-one coaching or group sessions that cover a variety of topics to help outgoing employees in their job search. Topics might include career guidance, job searching skills, CV writing, interview preparation, networking and how to negotiate as a candidate.

So why should you, as an employer, look to provide outplacement as part of your employee lifecycle?

Protect your employer brand and reputation

The advent of sites like LinkedIn and Glassdoor means your employer brand and how you’re perceived externally is more important than ever. Making employees redundant, particularly if it is unexpected, is never easy.

But handling it with the due care, empathy and compassion it deserves and offering outplacement support to your employees makes the chances of you parting ways on good terms a lot more achievable. It also means past employees are more likely to recommend you as a potential employer to their peers, making it easier (and cheaper) for you to attract new talent, when the time comes.

Outplacement can help to protect your brand and reputation as an employer. It can help to externally demonstrate that you care about your employees and will support them during the most difficult of times. Simply put, outplacement sends a very clear message to your remaining employees and the wider general public about how you treat your people, even when you’re letting people go.

Reassures remaining employees and maintains productivity

During times of change within your business, and particularly during periods of redundancy; productivity can be hit hard. Employees may have their own fears about their future and as such, attention is diverted away from their roles.

Our friends over at COLLABZ reported that a 1% downsizing of your workforce can lead to a 40% drop in employee engagement while increasing the voluntary turnover by 31% in the following fiscal year.

Demonstrating that you have an outplacement programme in place and that you’ll support employees that are being made redundant (and those that leave of their own accord), can help to allay these fears and allow them to concentrate on their role.

Reduces risk of litigation

In lieu of a settlement agreement, the risk of legal proceedings being brought against an employer can be significant in times of redundancy. Employers will offer a settlement or compromise agreement when they want to terminate a contract on terms agreed with the employee. This is so that there is a clean break with no opportunity for court proceedings or a tribunal for more money.

A holistic outplacement process can help to reduce a business’ exposure to legal cases as a result of redundancies being made.

Outplacement support can encourage employees to look ahead and channel their heightened emotions into something positive like their job search. Left unaddressed, these emotions could spill out as anger, contempt and unhappiness with the manner in which their employment was terminated. This in itself could lead to a legal case being brought against your company for unfair dismissal.

Encourages smoother handovers

Providing meaningful outplacement support will ensure that departing employees remain engaged with your business, and their job responsibilities until their last day with you.

If workers are treated fairly and are well supported throughout their redundancy, this will likely lend itself to a smoother handover process, more engagement in transferring projects and tasks and sharing knowledge with the remaining members of their team.

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About Natural HR

Natural HR is a cloud-based HR software company for growing businesses with 100+ employees. Since launching in 2010, we’ve been building a comprehensive suite of HR functionality that equips the small to medium-sized enterprise with everything needed to build an effective and efficient HR operation.

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