TITLE – LAYOFFS IN IT COMPANIES
AUTHOR – ALIFIYA KANCHWALA
1 Procedural Fairness in Restructuring and Layoffs between two Telecom Companies of Pakistan
This study compares impact of Procedural Fairness in Layoffs and Restructuring on Employee satisfaction between two telecom companies [Pakistan Telecommunication Company Limited (PTCL) and Nokia Siemens Network (NSN)] operating in Pakistan. … Correlation coefficient shows strong positive association between Procedural Fairness in Restructuring and Layoffs with Employee Satisfaction in case of NSN then PTCL. Moreover, regression analysis show that Procedural Fairness in Restructuring and Layoffs are fairer in case of NSN as compare to PTCL. These processes have matured in case of NSN, where employees are more satisfied with the Procedural Fairness in Layoffs than Restructuring
Mass layoffs in the Czech Republic and Slovakia
The paper describes the legislative framework for mass layoffs. … The paper analyzes particular cases within selected companies. Companies tried to avoid mass layoffs by reducing costs such as an elimination of selected employee benefits, shortening working hours, abolition of recruitment, etc. … When analyzing the process of mass layoffs, authors have built certain assumptions. Assumptions were divided into five groups dealing with the reasons for layoffs, employee selection criteria, layoff process itself, help for laid-off employees, and building a good reputation.
“When Are Layoffs Acceptable? Evidence From A Quasi-Experiment
We performed quasi-experimental surveys to study when employees in the U.S. and Canada feel that layoffs are fair. Layoffs were perceived as more fair if they were due to lower product demand than if the result of employee suggestions. This result appears to be solely due to norms of reciprocity (companies should not punish employees for their efforts), rather than norms of sharing rents, as new technology was also considered a justification for layoffs. Consistent with theories of distributive and procedural equity, layoffs were perceived as more fair if the CEO voluntarily shared the pain. CEO bonuses due to layoffs lowered their reported fairness only slightly.
Layoffs as Part of an Optimal Incentive Mix: Theory and Evidence
These contracts contain a mix of incentives, such as fixed wages, bonus payments, promotion options, and layoff threats. … In particular, we show that it can be optimal for firms to combine cost-efficient incentives such as promotions and bonuses with layoffs. The intuition is that layoffs play a dual role. … Using personnel records from a large international pharmaceutical company, we find that the model’s predictions are consistent with the data.
“Layoff announcements and intra-day market reactions
This paper examines investor intra-day reactions related to two types of layoff announcements, the first one at the start of layoff negotiations and the other at the final layoff decisions. We provide statistically significant evidence that, on average, investors have strongly negative reaction to layoff negotiations within the first 10 min. … Moreover, on the aggregated level, final layoff announcements do not generally convey information that is exceptionally useful to investors, except when reactions to associated initial announcements have not been statistically significant. … Finally, we find that intra-day reactions cannot be explained by various company background characteristics, such as the number of employees, sales, profitability, and assets/liabilities ratio.
When are layoffs acceptable? Evidence from a quasi-experiment,
We perfomed quasi-experimental surveys to study when employees in the U.S. and Canada feel that layoffs are fair. Layoffs were perceived as more fair if they were due to lower product demand than if the result of employee suggestions. This result appears to be solely due to norms of reciprocity (companies should not punish employees for their efforts), rather than norms of sharing rents, as new technology was also considered a justification for layoffs. Consistent with theories of distributive and procedural equity, layoffs were perceived as more fair if the CEO voluntarily shared the pain. CEO bonuses due to layoffs lowered their reported fairness only slightly.
Relationships, Layoffs, and Organizational Resilience: Airline Industry Responses to September 11,”
Certain of these companies emerged successful, however, and demonstrated remarkable resilience while others languished. This investigation identifies the reasons why some airline companies recovered successfully after the attacks while others struggled. Evidence is provided that layoffs after the crisis, while intended to foster recovery, instead inhibited recovery throughout the four years after the crisis. But layoffs after the crisis were strongly correlated with the lack of financial reserves and the lack of a viable business model prior to the crisis. … One implication of our findings is that layoffs, while reducing costs in the short term, may also undermine the positive relationships that are critical for achieving lasting recovery.
“Board of Directors’ Remuneration, Employee Costs, and Layoffs: Evidence from Spain
Thus, in this study, our aim is to test whether there is a causal relationship between the remuneration of the board of directors of listed companies and the personnel policies of the companies, expressed through the cost of personnel and layoffs. For that, we used a sample of Spanish listed companies, and we found that two performance measures (return on equity and earnings per share on market price) have a greater effect on the growth rate of board remuneration when layoffs occur
The Perceived Fairness of Layoffs in Germany: Participation, Compensation, or Avoidance?,
This study analyses to what extend and under what circumstances layoffs are accepted in Germany. … Key findings are: (1) The management of a company can increase the acceptance of layoffs if the employees get some participation rights. (2) For impartial spectators generous compensation for those made redundant leads to a higher degree of perceived fairness. But job alliances are not even preferred to layoffs without measures to soften the blow of job loss. (3) Implicated stakeholders accept job alliances and perceive wage cuts as fair than layoffs
“Investor Reactions, Social Implications and Layoff Announcements in the UK: A Comparison between Periods
Second, it further discusses the social implications of layoffs and the extent to which investor reactions towards layoffs may have changed overtime. Details of layoff announcements for UK listed companies were gathered for the periods1980 to 1984 and 1990 to 1995 inclusive. Comparative to prior U.S. findings, the results show that UK investors do respond negatively to announcements categorised as reactive. Two findings not established by prior research were: (1) UK investor reactions appear to be much more sensitive to layoffs in the 1990’s as opposed to the 1980s, and (2) UK investors appeared increasingly sensitive toward layoffs compared to their US counterparts.
11 – As more and more Big Tech companies continue to sack employees, they have listed various reasons behind the move — over-hiring, uncertain global macroeconomic conditions, strong tailwinds from the Covid-19 pandemic.
REFERENCE :
1 Jibran Hussain & Hassan Ali & Mobashar Sadik & Saba Qasim, 2017. “Procedural Fairness in Restructuring and Layoffs between two Telecom Companies of Pakistan,” Global Journal of Social Sciences Studies, Online Science Publishing.
2 Jiří Duda & Katarína Hrubová, 2011. “Mass layoffs in the Czech Republic and Slovakia,” Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press.
3 Charness, Gary B & Levine, David I. I., 2000. “When Are Layoffs Acceptable? Evidence From A Quasi-Experiment,” University of California at Santa Barbara, Economics Working Paper Series qt4vs7h4hh, Department of Economics, UC Santa Barbara.
4 Frederiksen, Anders & Takáts, Elöd, 2006. “Layoffs as Part of an Optimal Incentive Mix: Theory and Evidence,” IZA Discussion Papers 2447, Institute of Labor Economics (IZA).
5Santiago Velásquez & Juho Kanniainen & Saku Mäkinen & Jaakko Valli, 2018. “Layoff announcements and intra-day market reactions,” Review of Managerial Science, Springer, vol. 12(1), January.
6 Gary Charness & David I. Levine, 1999. “When are layoffs acceptable? Evidence from a quasi-experiment,” Economics Working Papers 369, Department of Economics and Business, Universitat Pompeu Fabra.
7 Jody Hoffer Gittell & Kim Cameron & Sandy Lim & Victor Rivas, 2005. “Relationships, Layoffs, and Organizational Resilience: Airline Industry Responses to September 11,” EERI Research Paper Series EERI_RP_2005_06, Economics and Econometrics Research Institute (EERI), Brussels
8 Mariano González-Sánchez & Eva M. Ibáñez Jiménez & Ana I. Segovia San Juan, 2021. “Board of Directors’ Remuneration, Employee Costs, and Layoffs: Evidence from Spain,” Sustainability, MDPI.
9 Christian Pfeifer, 2007. “The Perceived Fairness of Layoffs in Germany: Participation, Compensation, or Avoidance?,” Journal of Business Ethics, Springer, August.
10 Phillip McKnight & Anthony Lowrie & Chris Coles, 2002. “Investor Reactions, Social Implications and Layoff Announcements in the UK: A Comparison between Periods,” Journal of Management & Governance, Springer; Accademia Italiana di Economia Aziendale (AIDEA), March.