Ten top tips on navigating retrenchment
by 10x InvestmentsA report released by Statistics SA this month found that one in three South African businesses are laying off staff to cope with the Covid-19 pandemic and the lockdown.
The Stats SA survey, released mid-May, showed that 36% of 2,182 businesses surveyed across a wide variety of industries were cutting staff levels in the sort-term, with one in 10 saying they had ceased operations permanently.
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Every corporate restructuring is unique, but there are some guidelines and golden rules that can help to make the best out of a bad situation.
Expect anxiety levels to rise
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It is natural that people’s anxiety levels will rise during a corporate restructuring, says Susan Fouche, Head of Human Capital Management at 10X Investments. “It is important to recognise this, and to understand that heightened anxiety levels can interfere with your ability to think straight”.
She recommends trying to step back and get some perspective. Don’t feel obliged to respond to everything immediately. Ask for time to think things through.
Of course, you will want to talk to family members and friends but remember that they are likely to be offended and hurt on your behalf, as well as worried for you. While this might feel reassuring emotionally it is not necessarily the best position from which to evaluate tough choices and make plans.
Go to the source
“The golden rule,” says Fouche, “is to go to the source.”
Your mate from the marketing team, who is also being retrenched, is not the best source of information about the process. Rather discuss your questions and doubts with your line manager, or a HR representative. You could ask to see them together and, perhaps, if you pick up a common theme of questions or uncertainty around you, bring that to their attention.
“Speculation creates anxiety,” says Fouche. “It Is much better to focus on the facts.”
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See the restructuring for what it is
Fouche, who has advised a number of companies on restructuring, says it is common for some affected employees to complain a lot, to gossip and to become destructive.
“Accepting that restructuring is a legitimate way for a distressed business to refocus, recover and survive is a good starting point,” she says. “It really doesn’t help anyone for those affected to be terribly sceptical about everything.”
The reality is that a lot of jobs have already been lost in South Africa, with many more expected to come. Almost a third (30%) of companies that responded to the Stats SA survey indicated that they could survive less than a month without turnover. More than half (55%) said that they could survive between 1 and 3 months. Only 7% could survive for a period longer than 3 months.
Adjust your attitude
A key piece of advice from Fouche that underpins a lot of the other guidelines is to try, as much as possible, to keep yourself in a constructive frame of mind throughout the process.
“The quicker you move into a more constructive, positive mindset the better decisions you will make.”
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Make use of all support and resources offered
It is usual for companies that are undergoing restructuring to offer support, everything from trauma counselling to retraining, CV building and financial planning. You would be well advised to make the most of what is on offer.
While your first instincts might be to be defensive and sceptical, the professional support offered might be just the thing you need to get into another job. In the interim, personal counselling might help you stay sane and take some pressure off your personal relationships.
Fouche says: “Companies I have worked with have offered a wide variety of outplacement support, things like counselling and CV building, re-entry-to-market strategies and also retirement planning.”
She urges all employees to take advantage of help offered by the organisation. “Often people don’t, which is a great pity. The hit rate is that generally only a third of people show up for sessions offering support, counselling, financial planning and so on.”
Don’t burn any bridges
The relationships you had at your employer do not necessarily end when you leave that job. Your former colleagues might be your best assets when it comes to networking in your industry and discovering who is hiring.
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Stay in the game
Think of this as an interruption, not the end of your career.
Ask for references earlier rather than later. When you approach someone for a reference include some information about how long you worked at the company, when you started working with the person you have approached, your main responsibilities and so on. It is worth pointing out work you particularly enjoyed and areas where you feel you did well. The point here is that the easier you make it for people (who are probably also stressed, even if they haven’t lost their jobs) to write comprehensive references, highlighting things you like and do well, the more likely you are to get interesting references quickly.
Remember that when you lose a job, you don’t lose the experience and knowledge you gained in that job. You are not starting from scratch. Likewise, you should make sure you don’t have to start your retirement savings from scratch by cashing it all out.
Preserve at least some of your savings so that you can pick up where you left off when you get back into work. Starting from zero again will probably be quite depressing.
You can preserve your savings in the fund you are in, or you can transfer them tax-free to a pension or provident preservation fund or a retirement annuity. It is a good time to check that you are not paying over-the-odds for management of your savings. Keep your fees close to 1% or less, an extra percent or two makes a huge difference in the long run.
Make sure that your CV is current. There are plenty of free CV tools on the internet that you can use to beef your CV up, or give it a new look.
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Tim Merryweather, 10X Investments’ Chief Financial Officer, suggests that you keep your job-hunting hours to a schedule, rather than spending the whole time searching, worrying, obsessing.
Network, Network, Network.
Merryweather adds that employees of stressed companies should make an extra effort to keep their LinkedIn profile up to date.
“Try to connect with as many people in your industry as possible. Stay active on LinkedIn, like, share or publish articles that you like,” he says.
He adds that you should think of networking as your new job. “Chat to as many people as possible. Chats will lead to more chats, and more chats will lead to opportunities.”
Remember that you are not alone
Fouche says that almost everyone in a company that is being restructured suffers, including those whose jobs are not under threat. It is worth remembering that even your line manager and the HR team, who delivered this bad news to you, would prefer you not to be going through a difficult time.
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On a personal level, Merryweather adds, “reach out to mentors and friends for help and advice”.
Be prepared
When you do get a job interview, even if you think you know the company or the industry well, make sure you are properly prepared. “Research the job, the company and the people. Have some questions to ask the interviewer and be ready to confidently talk about your experience in a way that the new employer will be able to see how you can add value,” says Merryweather.
His final piece of advice is “to know what value you bring to the world or a prospective employer and make sure you can articulate it clearly to them”.
Anyone who loses their job this year and chooses to preserve their pension fund savings in a new preservation fund or retirement annuity with 10X Investments will not pay fees at all for their first six months. To request a fee-free analysis and cost comparison on your retirement savings go to https://www.10x.co.za/campaign/fee-comparison. DM
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