Redundancy — it's likely to happen more than once in your working life, often through no fault of your own (the coronavirus pandemic is a prime example).
And while it can feel like a personal rebuke, in most cases it is not a comment on your performance.
"It's absolutely a misconception that redundancy means someone is not good at their job," says Randstad's New Zealand country director Katherine Swan.
"In today's market, it's understood that genuine redundancy happens when a role is no longer tenable, often because of improvements in workflow and operational efficiencies, and usually occurs as part of transformational change. It is important to note that redundancy is about the role and not personal."
That also means it is no longer a "black mark" to future employers.
"While there may have once been a stigma around someone being made redundant, most employers understand the commercial realities that lead to restructures and redundancy within companies," says Swan.
"Managing through change is a reality of the modern workplace and its unlikely to result in a negative attitude towards a candidate whose previous role was made redundant."
She says candidates can positively influence the way a redundancy is perceived by a future employer. "Employers look for all sorts of qualities in candidates and being able to demonstrate a strong sense of determination and resilience are extremely positive personal attributes.
"Often there will also be a great human interest story about how a candidate has used this time out of the workforce to their advantage. This might include volunteerism or expanding their skill set with further study. Redundancy often gives individuals lived examples of when they have had to work through change and demonstrate resilience, both skills that are highly sought after in today's work environment."Employers need to get it right Employers should handle any redundancy with tact and understanding.
"Before making any announcements, employers should ensure they are compliant with New Zealand's employment law with regards to redundancy.
"Professional advisers can help employers understand and meet their obligations."
Swan says employers should develop a communication strategy that factors in all stakeholders of the business (all staff, shareholders, clients and suppliers) and include how and when announcements will be made.
Other tips for employers include:
● Be transparent and don't sugar-coat the situation — call it what it is and acknowledge the uncertainty and unhappiness that redundancy brings.
● Have all paperwork in order for each employee; include a plan with timing, logistics and options — ensure these are in accordance to their employment contract.
● Don't announce the redundancies in a group setting, bring people in for individual meetings to enable them to process the news and ask questions that relate to their own situation. Then bring the wider, relevant team together.
● Be professional but not devoid of feelings — have empathy and compassion for the range of emotions the employee will be experiencing and keep the focus on the redundancy of the role rather than the individual being redundant.
Getting the process wrong can be costly for businesses. "A mishandled redundancy process poses a number of reputational risks to the business with the potential to leave them in worse shape," says Swan.
"If an employee feels that a redundancy has not been handled fairly or is not a genuine redundancy, they can appeal it. If retained staff feel their co-workers were unfairly treated, they may lose faith in their management, impacting on loyalty and potentially on productivity.
"There is also the potential for people to air their redundancy grievances publicly, which may result in a backlash from consumers, as in the case of the Cadbury factory closure in Dunedin a few years ago.
"Within the planning process, it's important to consider the reputational risk to the employer brand. If the business eventually gets back into hiring mode, negative sentiment from disgruntled ex-workers could cause would-be future employees to give it a wide berth.
"Many businesses will offer employees a career counselling service to support them through the post-redundancy phase and help them prepare for their next role.
"Nobody enjoys being the bearer of bad news. Letting people know they are going to lose their jobs can also be a stressful time for employers, managers and human resources so it's worthwhile considering some pre-and post-restructure support for these people too."