A downturn in the economy troubles employers and scares the life out of employees. Employees know that if the down trend continues, one of the certainties that some will face is employee layoffs. How many and who, are the questions of concern to everyone when it comes to layoff time.

What To Do & How To Do It.

1) Employee Identification and Ranking
Every company generally has employees who, at any given time, fit into one of five categories.

*Star performers (10%)
*Good / very competent (20%)
*Average /satisfactory performers (40%).
*Mediocre performers (20%)
*Poor/problem performers (10%)

a) The Stars- this group may include some of the most junior people (in length of service) that you have. But they are very good at what they do, are curious to learn and grow and have the energy required to be consistently high standard performers.

It’s important to find ways to keep these quality people growing, developing and contributing to your company for the immediate and long term future.

This group will also contain some senior (experienced) people who also merit being thought of as "stars" and given the appropriate consideration.

b) The Very Good-just below the stars group will be other, likely senior, experienced and well skilled employees. This group of employees is very competent and are definitely keepers, whether it's a downturn or a high growth economy.

c) The Average/Satisfactory Performers -will usually be the largest group of your employees. As long as you are sure that each one in this group is providing you with a performance quality that you accept as satisfactory, you should express your appreciation for their service and continue to encourage them to reach out to strive for higher achievement. You need these folks who are reliable and dependable, albeit not "stars", because they make up the majority of your workforce.

d) The Mediocre Group- may include long service people who have been allowed to "soldier–on" because in the recent heated upbeat economy, employees of any kind were often hard to find. What about now, in these more difficult circumstances? What to do?

• Have some straight talk with the employees who have caused you some concern about their performance but who you also believe are probably capable of repairing the situation by improving productivity and performance quality with a little “motivation” from you.
• Tell them that you may be shortly faced with some difficult decisions re who stays and who may not be able to remain.
• Express the belief that they can still turn things around, but that it needs to be done quickly.
• Ask them if they really want the opportunity to show that they can measure up to a higher standard?
• Give them a specific time span in which they have to show you that they can meet your standards.
• Ensure they understand that at the end of that period, you will have to make some hard decisions.
• Some will appreciate your openness, as well as the opportunity to “strut their stuff” consistently to convince you that they should be a “keeper”.
• Some will not. (You know what to do with them).
• Then let the ones who want it, have that chance. Give them an honest appraisal and decision when the time is up.

This process is fair, may turn average into excellent or at least very competent, so it
is highly recommended.

e)The Poor/Problem Performers-identify the employees who have a history of problem performance and who will not be capable of giving you what you need, particularly in the difficult times when the pressure is really on everyone to be great.

• They are the employees who could spend the rest of their pre-retirement days trying to measure up, but are just incapable of enough positive change to justify keeping them. Each position you have is invaluable so the competition is stiff. During a difficult economy everyone has to be better than they have ever been in order to be retained.
• These are the people who should be among the first to go. Be honest with them, treat them well re notice and/or severance and enable them to leave with their dignity intact and a feeling that they have been treated fairly.

This process is difficult but absolutely necessary.

2)WHAT NOT TO DO- do not ignore any cases of performance concerns and just allow the employees concerned to drift along, because you are a nice guy and feel badly for them. Reality check: You must accept that to do so is not being fair to yourself, your company or to the employee. Believe it or not, no one enjoys being considered as a poor or problem employee. Allow these people to get a fresh start somewhere else. Do not enable them to just drift (at least not in your enterprise.)

3) THE NEXT PRIORITY- Once you have identified your stars, your satisfactory performers and those who need to improve or leave, there’s another important step. You should turn your attention to how to keep “the doors open” for the intake of newcomers who have the credentials, reputation and experience that would be invaluable to your company.

There will always be employee candidates who are looking for stable employers with a great record of steering through the stormy times and the financial capacity to not only survive but perhaps prosper. These are people who want exciting and challenging opportunities and who have the potential to be highly capable and extremely productive.

The stars of tomorrow may be on your doorstep today. You need to consider them, recognize them for who and what they are. Ensure that you always have room for a few such candidates to help ensure your organization’s future success.

The coming (new hires) and going (terminations and retirements) of employees goes on no matter what the state of the economy is at any point in time. The issue here is that some of the leaving employees are taking a lot of experience away from the company and experience counts heavily when the economy is difficult.

Recognizing this, are you onside with ensuring that your HR people, or someone with HR matters as part of their responsibility, are continuing to use pre-retirement planning to ensure an open dialogue and strong connection with the senior people who you consider to be key players?

If you are willing to be flexible about work schedules, benefits and compensation, you may be able to make it worthwhile for those key people to consider carrying on beyond their normal retirement age.

This will then allow you to continue to use that invaluable experience for the benefit of your company, in difficult times as well as times of rapid growth.


Are you a leader as well as the boss (most senior manager)? The above scenarios require strong, determined and visionary leadership by the decision makers in the organization. The job of the leader is to see clearly what is right, appropriate and essential for the continuing good health of the company. The next step is to make develop an intelligent plan. This plan should give all possible consideration as to how the company can retain the employees who will help you move the enterprise through the downtime and back into the upturn growth economy. You know that the return to better times is not very far away.



Jerry Jellison
April 3, 2009

Author's Bio: 

I am a Canadian Human Resources specialist with 40 years of experience as an active practitioner for a very large Canadian dept. store corporation. My experience includes responsibility for all phases of human resources management, with special emphasis on employee relations (including much time spent on relationship counseling), labor relations (negotiating and living with collective bargaining agreements) and training & development for both management & non-management employees (customer service standards, leadership skills, human relations, human rights (discrimination and sexual harassment issues), self esteem & self confidence. I own/operate a writing and editing website business (jjwritesmith.com), have recently started a blog (jerrysjournal.blogspot.com). I write a newsletter for an employee benefits company and also serve as a Human Resources Consultant /Advisor for that same company. I also act as the HR Consultant/Advisor for a custom tool manufacturing company.

I have written and published poetry and have received awards for it.I write a lot of poetry for my own relationship and on request of my website customers I write custom made poems for special occasions (weddings, anniversaries, funeral eulogies, holidays, romances, etc).

I am currently writing a book that will be the first in a series of books on various aspects of relationships.