The Sunday Mail
IT is obvious that in business retrenching employees can be a very strenuous and stressful exercise as compared to recruiting.
However, at times when the economy slows down one has no option but to cull jobs. Unfortunately, the country finds itself in these unenviable circumstances.
But in as much as the retrenchment process might be inevitable at certain times there is still need for serious consultations between the employer and the employees that will be affected.
Also the correct procedures that are spelt out in the Labour Act have to be followed. It must be appreciated that companies retrench for different reasons.
The shareholders, who are usually driven by the fiduciary expectation to safeguard the interest of investors, might decide to cut jobs in order to contain costs.
Workforce management remains an important tool for entrepreneurs to control the business. The duty of management is to ensure that the company has the right people and the right numbers for the job.
When employees complain of work overload at the workplace, the veracity of their claims has to be assessed. If the claims are true, it may be time to recruit new employees.
The opposite also means there is need to retrench. No employer wants to pay workers for just seating at work.
However, the job market has become increasingly difficult in Zimbabwe and most employers would rather make their workers multi-task instead of hiring additional staff.
While multitasking can reduce costs, it can have the adverse result of compromising the quality of the product or service.
If the growth curve for a product and service is increasing, it is prudent for the company that manufacturers it to consider recruiting.
The organic growth of a company necessitates recruitment of additional workers.
For example, when mobile operators started they mainly concentrated on voice calls and SMS, but now that they have expanded into mobile money services, more workers are being taken on board.
Conversely, postal services are cutting jobs because the crucial service they use to depend on — delivering letters is now on the decline.
So, the growth or decline of a business is one of most crucial factors on the job market. But recruitment of staff is not a simple process. It depends on the skill set that is required.
As a result, skills and knowledge are very important to evaluate when one needs to recruit or retrench.
For example, accounting standards change regularly and accounting packages are being used regularly.
A 1980 accountant whose skills hasn’t been upgraded might fail to cope with 2016 accounting.
Systems like quick books, pastel and sage have evolved over the years and the business may need an individual who can use a particular system.
Changing from the manual system to computers may certainly require new skills hence the need to recruit. If revenues are constantly increasing, then it is also wise to recruit.
Creating employment is always a welcome development in any country.
By delegating and recruiting more staff, an entrepreneur can have time to focus on other projects. However, if revenues are dwindling, then the company could consider retrenchments as they may fail to meet their obligations.
Clearly, written job descriptions are important when recruiting new employees.
Besides being used when hiring new staff, this same document is crucial in serving as a basis for evaluating employee performance.
If it’s too general, non-specific or doesn’t adequately reflect what the employee actually does on the job, then it’s a waste of time and effort.
The document can also be used as a reference when retrenching staff.
Some jobs could be a duplication of duties and there may be no need to have several people doing the same task.
A simple job description can include major and related duties, responsibilities and tasks the employee must perform, the expected standards of job performance, the reporting relationships — the people or job title to whom the employee will report and who, if anyone, will report to the new hire, the financial and fiscal responsibilities and spending limits — if any, the standards of acceptable behaviour and the working conditions.
Both recruiting and retrenching involves costs, even though retrenching can be costly as retrenchment packages are involved.
However, it is a very important decision for management to take as employment costs usually take much of the business expenditure.
An economy by its very nature is volatile and swift decisions are often needed to ensure the smooth operations of the business.
Globally, the business environment is constantly changing as innovation is progressively shaping and changing markets.
New products and change in policies is driving the global market and this also affects recruiting and retrenching.
Workforce management is now a very important tool to have as failure to manage employees well can lead to bloated obligations and even unwanted job action.
At the end of the day, business leaders should know when to recruit or when to retrench.
Taurai Changwa is an articled accountant with vast experience in tax, accounting, audit and corporate governance issues. He is the MD of SAFIC Consultancy and writes in his personal capacity. Feedback: [email protected], Facebook page SAFIC Consultancy and WhatsApp 0772374784
