Labour Affairs Q&A: Getting rid of misfits

We plan to reduce our present work force by 10 per cent, with proper severance payments, of course. Is it lawful to select and let go the least competent, those with more days of sick leave and the like?

The management's right to manage, especially to hire and fire, is restricted by the law, by contracts with individual employees, and by the collective-bargaining agreement made with the union (if any).

Let us consider your redundancy situation. Staff become redundant because of work realignment, enabling the company to do more with less; a lean operation approach. Business downturn is also an important cause.

Employers may lawfully lay-off employees whose jobs become redundant. The "misfits" and the less competent, however, may hang on, rather than be replaced through changes in job assignment.

Despite complying fully with the Labour Protection Act, making severance payments and serving advance notice, employers can be faulted on unfair dismissal charges. For employees who are members of the Worker Council, termination requires prior approval from the Labour Court. The union, or unionists, may also lodge complaints with the Labour Relations Commission alleging a lay-off is an unfair labour practice aimed at undermining the strength of the union. This may lead to a reinstatement order, or compensation for damages.

To remove misfits, unionists or otherwise, it is advisable to announce a "Mutual Separation Programme" calling on employees with many years of service or those who can be replaced from within or through job realignment, to resign in exchange for financial compensation higher than severance payments.

Make sure two key messages are clearly stated. First, it is the employer's right to consider who to let go, and who should stay, so as to block the competent ones from leaving. Second, emphasise the need to lay off more employees on the grounds of redundancy, should insufficient volunteers choose to leave. Criteria for selection are poor attendance and low performance appraisals.

This arrangement is an effective measure for getting rid of misfits without having to compensate for damages if there is any unfair-dismissal litigation.

Supachai Manusphaibool is managing director of MR&TS, a cross-cultural management consultancy. Send questions to mrts@truemail.co.th.