Business mentor: Changing staff to survive in a changing market

Q: After 30 years in retailing I have come to the conclusion that I must change our family business if we are to survive. We are not attracting a younger market and we need to improve our business systems to be more efficient.

I don't think some of the longer-serving staff will fit in, even if they master the new internet ordering and reporting systems.

I've been told that I can't force a person to retire (one is well into his 70s). What do I do?

A: Philip Kotze* of AdviceWise People replies:

In situations like this the moral issues often overshadow the facts.

The starting point is whether the employee can do the work she or he has contracted to do. The job description should spell out exactly what these duties are and, yes, if compatibility with the youth market is essential to do the job properly, then it must be specified in the job description.

If the changes are absolutely fundamental you could consider closing the existing business, making all the staff redundant and starting anew with a different company and employment approach to match the target market and systems you plan to introduce.

Or if you intend to evolve the existing business, you could redevelop the existing job descriptions to reflect the expectations of management for the future. As the job description forms part of the employment agreement, changes must be agreed to by both parties.

During the discussions with your staff about this, they should indicate whether they want to continue on the basis of the new job descriptions.

This, rather than your judgment of their chances of adapting, is the basis for a fair decision and your protection against accusations of constructive dismissal. Naturally, you will offer retraining where required.

From that legal perspective it is easier to move on to the difficult moral issue: the treatment of long-serving and presumably loyal employees.

Without being naive enough to suggest that all long-serving employees are loyal, long service does create an expectation of grace and companies cannot escape community judgment on the way they treat their staff. After so many years in business you are obviously sensitive to this.

My experience is that employees are often far more informed about coming change than management expects; that they are far more willing to accommodate change than expected; and that they readily face tough decisions once they feel that they have been treated fairly.

The best thing to do is to talk to your staff openly and frankly about your vision and how this will affect each individual. Listen to their comments and suggestions, and then decide how to proceed with your vision. It is your decision and no court should interfere if you follow this route.

* Philip Kotze is chief executive of AdviceWise People, an employment law and employment management firm working with small to medium businesses. The company offers an 0800 adviceline as well as a range of employment management guides, software and services.

Ph: 0800 692-384

AdviceWise

* Send Mentor questions to: ellen_read@nzherald.co.nz. Answers will be provided by Business in the Community's Business Mentor Programme.