Chapter 6 Managing Employee Separations, Downsizing, and Outplacement
26. According to your text, studies show that _____ of voluntary employee separations are avoidable.
27. Voluntary separations may include:
a) early retirements.
b) hiring freezes.
e) job redesigns.
28. Similar to a quit, a ______ is initiated by the employee, but in this case the employee is unlikely to search for another job.
29. Sara is 57 years old and she has been a division manager for Elf Cookies for 32 years. Recently, the business has seen an increase in efficiency and has found itself with a surplus of labor. Elf Cookies is offering employees who are 55 and older, and who have worked for the company for over 30 years, specific benefits and financial incentives to retire within the next 60 days. Sara does so. She has:
b) been bought out.
c) copped out.
d) taken early retirement.
e) been discharged.
30. The decision to terminate is management’s employment role. HR’s role is to:
a) implement the decision.
b) be the employee’s advocate by trying to change management’s mind.
c) make certain the employee receives due process.
d) side with management in enforcing the company’s employment policy.
e) document poor performance so the termination can be justified.
31. Alex is a first-line supervisor with an employee who has a performance problem. After much coaching of the employee with little apparent improvement, Alex decides to terminate the employment relationship. This type of separation is called:
a) a layoff.
b) a voluntary separation.
c) a discharge.
e) a retirement.
32. Bertha wishes to discharge one of her poorly performing employees. She has tried progressive discipline with no effect. She asks you, the HR manager, what she must do to discharge the employee. You tell her the policy and procedures, and then ask her if she has ____ in order to protect the company from a wrongful discharge suit.
a) documented the inappropriate behavior and her efforts to correct it
b) cooperated with the HR department and followed their instructions
c) given 60 days notice as required by law
d) used non-progressive discipline
e) considered department morale and how it will be affected by the discharge
33. Delmus performance reports have been increasingly poor, and he seems to have negative relationships with other workers in his department. His line manager has taken him aside twice to discuss his behavior and work and has offered him time to improve, but there has been very little positive progress. Management decides to end the employment relationship with Delmus. This is an example of a:
a) voluntary separation.
34. The primary difference between a layoff and a discharge is:
a) a layoff is an involuntary separation and a discharge is a voluntary separation.
b) a layoff is a voluntary separation and a discharge is an involuntary separation.
c) a discharge occurs when the company’s strategy forces it to reduce its workforce and a layoff occurs when there is a poor fit between the employee and the organization.
d) a layoff occurs when the company’s strategy forces it to reduce its workforce and a discharge occurs when there is a poor fit between the employee and the organization.
e) a layoff does not affect the morale of surviving employees as much as an employee discharge does.
35. Layoffs are one way to reduce the workforce. Layoffs happen because:
a) there is no direct cause.
b) the company offers incentives or buyouts to reduce the workforce.
c) adequate documentation has been kept of the poor performance.
d) there is a poor fit between the employee and the company or job.
e) the company’s environment or strategy force a reduction in its workforce.
36. Which of the following people may be affected by a company’s decision to perform a layoff?
a) Surviving employees.
b) Company stockholders.
c) Members of the community where the company exists.
d) Laid-off employees.
e) All of the above
37. A company needs to reduce its long-term workforce. It aims to remove layers of bureaucracy and services that do not add value to the product. The company is:
a) conducting a layoff.
c) buying out the workforce.
e) changing its internal employment policies to reduce the workforce.
38. If a business is downsizing, it is necessarily doing which of the following?
a) Reconfiguring the front-line employees.
b) Performing a layoff.
c) Rightsizing the company.
d) Reducing the size and scope of the business.
e) Offering early retirements.
39. The major difference between downsizing and rightsizing is:
a) rightsizing involves reducing the size and scope of a business, while downsizing is a reorganization of the business.
b) more workers are likely to be fired during rightsizing than during downsizing.
c) downsizing involves reducing the size and scope of a business, while rightsizing is a reorganization of the business.
d) the purpose of rightsizing is to improve financial performance, while the purpose of downsizing is to increase efficiency.
e) a and d
40. One of the more popular alternatives to layoffs for reducing the size of a company’s workforce is:
a) large scale discharges.
b) inducing quits.
c) early retirement programs.
d) providing outplacement services.
e) transferring workers to other plants.
41. Early retirement programs consist of two main features: financial incentives and:
a) generous severance packages.
b) open windows during which employees can choose the program.
c) outplacement services.
d) other jobs with another non-competing company.
e) health-care benefits.
42. Elizabeth is a 59-year-old account representative at a large bank. Due to the increasing popularity of online banking, the bank has more employees than it needs. Recently, the bank has offered early retirement to account representatives between the ages of 55 and 65 who have been with the company for a minimum of 15 years. 4 employees meet these requirements, and Elizabeth is one of them. It is likely that:
a) the bank is pinpointing Elizabeth and encouraging her specifically to take early retirement.
b) Elizabeth will receive full retirement benefits, including medical coverage, if she takes early retirement.
c) the bank is violating the Age Discrimination Act because they are forcing her to retire.
d) Elizabeth is incapable of performing her job as well as the younger employees.
e) the package won’t be as substantial as it might have been five years ago.
43. Early retirement programs:
a) can substantially reduce the size of a company’s workforce.
b) often drive stock prices up because of the reduced overhead.
c) generally have fewer people than projected take advantage of the programs.
d) has very little effect on reducing the size of a company’s workforce.
e) require very little effort for very large returns.
44. While a popular way to reduce the workforce, early retirement programs are not without problems, including:
a) insufficient participation to do the company any good.
b) making a company’s cash flow problems worse over the short run.
c) excessive unplanned health-care costs.
d) too short a “participation window” which limits the program’s effectiveness.
e) too many people — often the wrong ones in a strategic sense — take advantage of it.
45. A firm can manage participation in an early retirement program by:
a) restricting the program to areas of the business with a redundancy of employees.
b) making it available only to female employees.
c) offering it only to protected-class individuals.
d) offering the program only to employees who can quickly find other jobs.
e) having participating employees sign a “no-compete” agreement.
46. A manager comes to you, the HR manager, to ask you about helping some employees make decisions about early retirement. You caution the manager that certain behaviors on his part will appear coercive and he must avoid them. These behaviors include:
a) suddenly lowering performance appraisals which have been good over past years.
b) discussing the particulars of the early retirement program with the employees.
c) treating older employees better than younger employees.
d) offering older employees the opportunity to bump younger, less senior employees.
e) implementing an across-the-board pay cut.
47. The key to avoiding lawsuits over early retirement programs is to:
a) give preferential treatment to protected-class individuals.
b) treat all employees the same regardless of age.
c) take potential retirees aside and “counsel” them to take the offer, “or else.”
d) study the probable impact on the local community.
e) not offer early retirement and use some other alternative to reducing the workforce.
48. A layoff is typically implemented by an organization when:
a) it has no other means to reduce its labor costs.
b) HR doubts whether offering early retirement will achieve the needed results.
c) a majority of employees have been working for the organization for less than 15 years.
d) there are less than 100 employees.
e) the organization has excellent outplacement services.
49. Once a firm has decided to reduce its workforce through voluntary means, its next choice is:
a) whether to lay off or discharge excess employees.
b) if it should downsize or rightsize.
c) what outplacement services to offer.
d) to determine what alternative strategies to layoffs are available.
e) none of the above
50. Compared with the United States, Japan’s employment policies:
a) are relatively short term.
b) are more likely to be “life-long.”
c) are much more permissive.
d) are very confusing.
e) tend to discourage a strong corporate culture.