HR leaders are expanding severance and internal transfer options to project positive company culture

Photo Credit : Shutterstock,

To gain an edge in a competitive labor market, more companies are expanding severance packages and offering job placement assistance to separated employees. According to RiseSmart’s 2019 Guide to Severance & Workforce Transition survey, 44 percent of all companies surveyed globally now offer some form of severance benefits to all employees. Following this trend, Indian businesses are also adopting employee-friendly policies such as severance benefits, internal transfers and job placement assistance to separated employees. 

Joel Paul, RiseSmart’s General Manager, India commented, “With businesses looking to hire the top talent, having an ‘Employee First’ culture acts as a key differentiator and helps protect the employer brand even in challenging times. Providing workers the mobility to move within a company can incentivize performance and build a culture where managers seek to hire internal candidates. This is becoming a popular way to keep talent from looking externally, and is part of the push to make workplaces more appealing so companies can avoid the rising costs associated with hiring new talent.”

The survey found corporate leaders are increasingly responsive to negative online comments by former employees that could damage their company’s reputation. Two-thirds of HR professionals said they monitor employee websites like Glassdoor and Indeed for negative reviews – a 10 percent increase from 2017. While 50 percent of companies with severance policies offer outplacement as part of those packages, 68 percent have additional brand protection mechanisms in place. 

“In a world where companies’ reputations affect their ability to hire and retain talent, organizations have to maintain a competitive edge at every stage of the employee journey–including upon separation,” said Dan Davenport, president and general manager of RiseSmart. “Severance is a great benefit because it can also help protect a company’s brand when layoffs are unavoidable.”

As part of the effort to protect their company’s brand, employers are also turning to redeployment or “in placement” benefits. 60 percent of all survey respondents claim to have programs designed to match employees with as many open internal positions as possible, as an alternative to separation. 48 percent of HR leaders cite company culture and the need to take care of employees as top reasons for offering severance to displaced workers