Question

Answer the following question through the prism of before the current economic downturn related to the coronavirus:

You are the HR director for a restaurant group that owns 20 restaurants and employs around 1,000 people. All of the restaurants are located in New Orleans, LA. Due to economic conditions, change in tastes of its customers, and rising food costs, the company will have to close five of its restaurants, resulting in significant layoffs. How would you go about "rightsizing" this organization? What are the ethical and legal issues to consider?

Answer 1

Rightsizing refers to the process which is undertaken with a view for making the organization more efficient in the terms of cost, and benefit. this is done especially by reducing the number of people or workforce at the workplace so that overall cost can be reduced and customers are not overburdened with the extra cost.

I would follow the following techniques to make a decision about rightsizing the organization:

1. Ratio analysis:

It is a very common technique which is used by many organizations for rightsizing. It is a set of comparison. It will give a clear idea of how many workers are required as per the workload of each restaurant.

2. Activity analysis:

This observation method can be used by the organization for calculating the time spent by the worker on its job. This provides information about how many workers are genuinely required by the organization.

Ethical and legal issues to be considered:

1. Termination criteria for the job

2. Promises made to the employees

3. Prior notification

4. Option to quit