Downsized Employees Get Help

By Atlas, Steve | The Washington Times (Washington, DC), January 19, 1998 | Go to article overview

Downsized Employees Get Help


Atlas, Steve, The Washington Times (Washington, DC)


As employment begins to climb, companies are still tapping into outplacement services as a way to handle restructuring. Many workers are using the services, created years ago during downsizing, to improve their skills for another job at the same company or possibly another firm.

In 1994, Baltimore Gas and Electric Co. (BGE) had a major downsizing. During an early layoff in 1990-91, about 300 to 350 employees had accepted early retirement.

In 1994, the company expanded its early retirement offer to allow employees who were age 55 or older to qualify for a significantly higher pension than they would otherwise would have received, and keep their health insurance and other benefits.

"We believe firmly that our employees were treated fairly in the process," says Nancy Caplan, BGE spokeswoman. "The employees are a vital part of the success of the company. When you are hired, there is a responsibility there. You can't just give a pink slip and say, `Sorry, goodbye, that's life.' "

Eight hundred and twenty-six employees accepted this offer, opening up jobs so layoffs could be minimized.

Employees at risk of losing their jobs were offered two choices: a voluntary-severance plan (VSP), or a placement-opportunity program (POP).

The VSP offered a generous severance pay offer. Depending on how many years they worked, employees received a lump-sum payment.

"We still have a competitive severance package. Downsizing is a reality in the corporate world. We try to do everything we can to avoid downsizing," the spokeswoman says. "BGE also tries to use attrition. Right now there is a hiring freeze."

The POP program set up a center, operated by the outplacement firm Drake Beam Morin, under contract to BGE. Employees could use the center for six to nine months.

BGE human resources staff members worked at the outplacement center to help employees with the following: apply for other jobs within the company; provide EAP (employee assistance program) counseling; provide educational counseling; and arrange for retraining classes at local community colleges. Frequently, the company paid for the retraining.

"We fund re-education classes, so workers can improve their skills for their jobs or to make a career shift," she says.

Drake Beam Morin staff provided training in resume writing, interviewing skills, individual coaching, testing and evaluation, and help finding jobs either within the company or with other employers.

During the 1994 BGE downsizing, 826 people chose retirement, 225 elected the voluntary severance plan and 83 participated in the placement opportunity program.

In 1996, the manager of BGE's POP program reported that all 83 POP participants had found jobs: 33 percent of them found other jobs within the company, and the rest with other employers.

Partnerships between downsizing companies and career management firms can offer laid-off or restructured employees the best of two worlds: the commitment of the (former) employer, and the experience of the career management company.

Bell Atlantic went even further than BGE.

In 1994, the company reorganized and sent its downsized employees to outplacement firms for help in finding new jobs. But it didn't work as well as expected. In a follow-up survey with the outplacement firms and its former employees, Bell Atlantic discovered that, even after six months, only 23 percent of its former employees had found jobs.

The company needed a different system.

Bell Atlantic approached Lee-Hecht-Harrison for help in designing a career transition program. With the program, employees could ease pain of separation (from their former jobs), prepare for a new type of job market and find jobs in less time.

The result was the START (Success Through Active Reinvestment of Talent) Center, a multi-corporate career center located at in the District. …

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