Effectively Managing Workforce Contraction In Turbulent Times

Key Points:

• In response to rising inflation, climbing interest rates and a looming recession, companies of all types and sizes have begun operational cost-savings measures, including workforce reductions.
• Employers should engage in diligent planning when implementing a workforce reorganization.
• Companies must carefully navigate numerous federal and state regulations as well as accompanying strict timelines attendant to the process.

Rising inflation, increased costs of capital and the anticipation of a downturn in the economy have caused companies in many industries to begin to implement workforce reorganizations and reductions.

In making plans for adjustments to company staffing levels, employers must tread cautiously. There are numerous federal and state employment law issues that employers should consider before implementing a reduction in force (RIF) or terminating individual employees. Failure to comply with the applicable statutes, which may