Staff Reduction

The current pandemic has forced businesses to alter the norms of operation or reduce the intensity of work, if not shut down, indefinitely. The shift into the red and shareholder consternation is the inevitable consequence for those businesses slower to respond. This is compounded by the uncertainty in estimating impact.

Yet, are shutdowns and employee ‘bail outs’ - where workers continue to be paid despite the cessation or slowing of operations, the only options open to businesses?

There are numerous non-financial gains from being in employment, some of which are as prosaic as the opportunity to escape a challenging home environment. Are there some alternative approaches and what might they be?

This article explores alternatives to staff reductions such as reallocating available and anticipated revenue on a proportionate basis and upskilling.

Redistributing Losses

Let’s think in terms of a 2 kilograms cake that currently serves 10, which shrank to become a 1 kilogram cake. The solution may lie not in withholding cake from 5 people but in serving each person a 100 grams instead.

Initiatives that redistribute losses, not only enact the Malay term “ berat sama di pikul”, they embody the sense of equality and unity, which family days and company dinners strive so hard to promote. In facilitating a concrete share of losses, they simultaneously, also procure goodwill and loyalty. Indeed, many experienced HR Consultants point to such initiatives being a major driver to building trust. Employees feel “invested” in the Company and this then enhances employer branding.


This period of restricted movement may present ideal conditions for upskilling employees (and paying for it through HRDF funds if the employer is a contributing to the HRDF). This could result in employees’ passions being stoked. A passionate employee doing what they are good at will certainly bring value to the employer.

The firm I am attached to has worked with a number of businesses to execute their alternatives to staff reduction, but we’d love to hear from you. Email us at [email protected] to ask for more information or share your experience.