August 26, 2021

How the Pandemic Changed Employer Attitudes Toward Redeployment, Severance, and Workforce Transitions

The economic fallout of the COVID-19 pandemic triggered widescale workforce restructurings across all industries, leading the unemployment rate to skyrocket to nearly 15 percent during the height of the crisis. As millions lost their jobs, organizations became the subject of intense public scrutiny regarding how they conducted layoffs during this tumultuous time. Employers realized that how they handle work separations speaks volumes about their values and brands and impacts their ability to recruit and retain talent in the future.

As a result, many organizations have begun to provide robust severance and outplacement benefits to separated workers and expanded redeployment opportunities to current employees. By offering reskilling opportunities that enable workers to seamlessly transition between different roles within the company, organizations can better retain talent, maintain institutional knowledge, make the business more agile, and avoid layoffs whenever possible.

To better understand trends related to redeployment, severance, and outplacement services, Randstad RiseSmart surveyed 2,000 HR professionals around the world for the 2021 Guide to Severance and Workforce Transition. Here are the five biggest trends we identified in 2021:

1. Employee Experience Has Become a Priority

During the pandemic, many companies came to better understand how current and former employees serve as brand ambassadors for their employers. What workers say about their experiences at an organization on social media platforms and sites like Glassdoor can significantly impact retention and recruitment. As a result, employers have enhanced and updated their severance and outplacement policies to improve the overall employee experience, even for workers departing the company.

Our survey found that more than a quarter (27 percent) of employers have updated their severance policies in the past two years. Almost a third (32 percent) expanded their education benefits, 27 percent expanded both their financial planning options and life insurance offerings, and 25 percent expanded their outplacement offerings. These shifts demonstrate the increased importance of employee experience, including the experiences of those who have left the organization.

2. Severance Is Being Offered to More Employees Across All Levels

Today, companies are much more likely to offer severance to all employees, no matter their position or length of tenure. In Randstad RiseSmart’s 2019 severance survey, only 44 percent of employers offered severance to all separated employees. In the 2021 report, that number increased to 64 percent, with administrative and professional staff most likely to benefit from severance packages.

While COVID-19 did motivate employers to offer severance to more employees, it also unfortunately led organizations to make changes to their severance policies to cut costs in the wake of the pandemic. However, as the economy rebounds, we expect that many organizations that reduced severance benefits will restore their offerings to pre-pandemic levels.

3. COVID-19 Prompted More Employers to Offer Outplacement Services

Sixty-three percent of the organizations we surveyed began offering outplacement benefits for the first time during the past two years. Moreover, 60 percent of these companies that recently began offering outplacement services were motivated specifically by the unexpected need to reduce their workforces during the pandemic.

Some of the reasons more employers are offering outplacement benefits include boosting morale and productivity among remaining employees, promoting employee-first cultures, and maintaining positive employer brands. Among the services many organizations offer via outplacement programs are resume-writing assistance, enhanced access to relevant job leads, and personal career coaching.

4. Redeployment Is More Common

Rather than turning immediately to layoffs during difficult times, employers are increasingly using redeployment to retain institutional knowledge and avoid involuntary separations. According to the Randstad RiseSmart survey, 77 percent of employers have redeployment programs to help workers find new roles internally, and 56 percent have used redeployment to rapidly address changing business needs. Additionally, nearly half of respondents said they’ve temporarily shared talent with external or partner organizations to address quickly shifting business demands and to avoid layoffs during the pandemic.

It’s clear these redeployment programs are working, as 34 percent of respondents said their redeployment efforts were “were effective,” compared to 20 percent who said the same in 2019.

5. Companies Are Teaming Up With External Partners to Achieve Their Employee-First Goals

The pandemic forced many talent leaders and HR teams to do more with less. As organizations prioritized taking care of employees during this period of uncertainty, HR departments had to rely on outside experts to help reimagine their employer value propositions and successfully deliver a shift to a more employee-focused culture.

Nearly 60 percent of survey respondents said they relied on external partners or a hybrid of service providers and internal stakeholders to manage their outplacement benefits and services. In comparison, only 38 percent managed outplacement exclusively through internal teams. This is a particularly noteworthy finding because, just two years ago, only 34 percent of employers leveraged outside partners.

Organizations also see the value in enlisting expert support for their redeployment initiatives, with 35 percent of respondents indicating that partnering with an outside expert would help improve their redeployment programs.

The pandemic has caused organizations to change their outlooks on severance, worker separation, outplacement, retention, and redeployment. Businesses are realizing that supporting employees throughout the entirety of their journey with the company — from recruitment to departure — is both the right thing to do and an effective way to improve morale, retention, productivity, and the employer brand. Ultimately, putting the employee experience first makes organizations more agile and resilient in the face of changing business needs and unforeseen economic challenges.

Dan Davenport is CEO of Randstad RiseSmart.

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Dan Davenport is CEO of Randstad RiseSmart, the company he cofounded in 2007. Dan initially led finance and operations for the company and later assumed the role of EVP, global operations, where he expanded the business to over 80 countries around the world. Today, Dan leads the global business, now the talent mobility and outplacement division of Randstad.
https://www.randstadrisesmart.com/