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Service Highlight - Layoff/RIF
(Reduction In Force) Guidance

In today’s economic environment, companies are increasingly exposed to face downsizing issues. Odyssey OneSource assists companies and employees in understanding the law, consequences of layoffs and terminations and looking into ways to maintain stability and productivity in the workplace during the process.

A workforce reduction process requires a very careful and early planning. However, challenging economic circumstances has forced employers to act promptly. What should employers look into when the employee experiences a formal layoff/ reduction in force (RIF) procedure?

-Determine whether a voluntary resignation program is a viable alternative to implementing involuntary layoffs.

-Plan for continuous operations and sustained morale – Early in the reduction planning process, evaluate job functions and skills. Decide whether they are essential or may be eliminated or consolidated.

-Ensure compliance with state laws – Recognize that a workforce reduction may trigger compliance obligations under various state laws governing payment of wages, insurance and severance benefits continuation, personnel record access, plant closings, layoffs, and involuntary termination. These often involve notice requirements.

-Determine impact on pension and benefit plans – Before taking action, investigate whether a layoff will trigger the vesting of pension or benefit plans for some employees.

-Consider “WARN” and contract obligations – the federal Worker Adjustment and Retraining Notification Act (WARN) and comparable state laws provide specific time limits and notice requirements for certain group termination programs. Assess existing limitations, liabilities and/or bargaining obligations related to layoffs created by collective bargaining agreements and other types of contractual employment obligations.

-Medical, dental, and life insurance will cease at midnight, the last day of the month in which employment ends.

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