An organization may be forced to lay off its workers to reduce operating costs in some instances. Proper management of employee separation is crucial to maintaining the institution’s strength and success. Employee separation can be done through retrenchments, layoffs, and early retirements. These employee separations may cause negative consequences, such as lawsuits, affecting organizations’ operations.
Before employee separation, both the worker and the company must engage in negotiations to agree on employee separation. These agreements may entail compensation, thus avoiding any lawsuits against the company. Lawsuits may portray the wrong image of the institution, thus affecting its stability and success.