In top rated healthy companies the employer follow a regular practice of firing employees who are not responsible and shows negligent to their commitments. But downsizing a company is completely a different concept. This is actually done to reduce the particular company's human strength or work force and it is not actually depends on the employee's performance. Downsizing is indeed a tough decision and is done when the company finds that some staffs no longer hold values for the company. It is from every angle a tough decision for the managers who are given the responsibility to deliver the bad news. So it becomes the responsibility of the concerned HR to motivate the existing employees in the tough situation and at the same time it’s very hard for those who lose their jobs after serving the Company for a long period of time. Although downsizing is not easy decision but ethical behavior towards the employees who are losing their jobs makes the whole procedure a bit easy.

Just staying away from the discrimination lawsuits is not everything until you treat your employees ethically during layoffs. It is all about the behavior towards the employees who stay behind and also the effected employees the way you want to. This is the ethical way of downsizing a Company.

Ethical way of downsizing means treating the employees with respect and through fair decisions. The provision of outplacement should be incorporated in favor of laid off an employee who loses their jobs due to sudden decision of the Company to reduce their work strength.

Here I will explain 7 different ethical ways of downsizing a Company.

1. Stop discriminating your employees:

Discrimination between men and women, minorities or any other protected groups is not entertained. If you layoff targeting only a special group without maintaining a proper balance then you are entertaining a lawsuit. So always do layoff carefully keeping in mind that you should not take any unfair decision at the time of determining which employees you want to layoff.

2. Evaluate other alternatives:

You need to consider firstly whether cutting the work force is really the only way to stay profitable. Always consider other available alternatives before you start the process of layoff. You can plan to cut the working hours allotted for each employee or reducing salaries or wages through a joint decision across the board. Those steps can help you in cost cutting while you can also explain the situation to your employees that you are taking these steps in order to keep them employed and you made an unbiased decision for all from bottom to top level executives.

3. Think twice before downsizing

Do not lay off employees immediately after taking decision about downsizing your Company. The company should do proper job analysis to determine the skills and abilities for each position hold by the employees and should adopt a proper process of measuring the skills that are required for a particular position. Following a proper system for evaluation of employees can help to avoid discrimination claims by the dissatisfied employees.

4. Proper assistance:

You can take an initiative to help the existing employees to survive their position.  It is good if it is possible to introduce a severance package that includes recommence and outplacement services and also assistance by providing references and recommendation letters wherever applicable.

5. Show respect to the employees

You should convey the heartbreaking news to the employees in person and in private. This bad news should be conveyed in a enclosed room where the conversation cannot be overheard by curious co-workers. Provide the leaving employee proper time to adjust with the situation and don’t follow them like criminals. Allow them to clean their table by themselves and say adieu to their co-workers without involving security guard to intervene into this matter. 

6. Take side of your employees:

If the layoff process is from anywhere unethical then you should speak out in favor of your employees. In spite of observing unethical behavior if you don't speak your words then you are actually committing a crime. Speaking the truth is not so easy but it’s good to stand up for your employees.

7. Assign responsibilities fairly amongst existing employees

Staying back after the layoff process is completed is good but now the question arises who will do the job of the leaving employees. Normally those extra work pressures were distributed amongst the existing employees and they get really exhausted due to extra load of work.  They always search for good opportunities to get rid of the extra pressure. So just try to reduce their pressure by involving in low priority projects and searching ways to execute the remaining work. Just think about good solution that will make the workers more efficient than making them work hard for longer period of time.

So downsizing ethically means the laid off employees get same level of respect as they got at the time of their interview. You need to realize that they are not only losing source of income but also a good association they were used to all of a sudden which is highly depressing for them. So try to make the process painless by making them comfortable and helping them to overcome their transition to a new job smoothly.