Alternatives to layoffs in a recession 17 December, 2008 By Vanessa Ho

"It really is a bad situation out there [but] a great thing about sitting on these peer boards & is we have options than just doing outright layoffs," said Jason Zickerman, an executive management and operations expert and president of The Alternative Board.

During some of these Alternative Board executive meetings, participants came up with some creative alternatives to layoffs.

The first suggestion was reducing the work week from five days to four. Zickerman said if companies are able to do so, they will see their payroll reduced by 20 per cent.

Another alternative is increasing an employee's time off. Instead of two to three weeks vacation, offer people five weeks with two that are unpaid.

Zickerman said that if organizations are able to get two weeks off of payroll for a good portion of their employees, it could result in significant cost savings. He added that younger generation workers seem to like this as they thought they would never have that much time off again. Still, Zickerman cautioned that it shouldn't be seen as a benefit but rather a better alternative than losing one's job.

As well, Zickerman believed that by reducing the work week or giving people more time off won't hurt an organization's productivity but instead these initiatives will make employees much more efficient and work harder to get their work done.

Offering staff a sabbatical (with a reduction in pay) was also suggested by the Alternative Board. Zickerman said that a sabbatical is not about employees doing whatever they want but about going away and doing some training or having an experience that when they do come back, they can apply what they learned to benefit the company.

Some companies can also swap or loan out employees to businesses that may need some help temporarily for project work or for seasonal help.

"It helps out the community and keeps your people employed and they really appreciate that and as soon as things turn around they can come back but you have to be careful," said Zickerman. "You have to make sure the job description is proper, expectations are set, pay is set and understood and doesn't compromise them returning to the organization. This has a lot more logistics and not as easy to put in front of somebody as an idea."

He added that the situation needs to fit in order to make employee swapping a viable alternative.

When doing these alternatives, Zickerman said that it is important that companies note layoffs can kill morale.

"If these ideas are presented and communicated properly, you are absolutely able to develop increased loyalty," he explained. "[Employees] will see that you are fighting for them & to stay in business so when things turn around, they will still have a job."

However, Zickerman added that while layoffs should be viewed as a last resort, it shouldn't be taken off the table, as it could be exactly what is needed for the company to survive.