Failed incentives in the work place

No matter how hard you work, or how good of a job you do, you can be laid off with no notice at many companies. On the other hand, if you aren’t doing very well, or do something wrong, there is usually a warning process before being let go. This doesn’t seem right. If you screw up, you get a second chance. If you do everything right, you can get thrown out on a whim. Why should a bad employee get privileges that a better one doesn’t?

It’s the difference between a reduction in force caused by business circumstances (where the departing employees will not be replaced), and firing an under-performing employee who will be replaced. A sensible company will do its best to take performance into account when doing RIFs, but they can’t always avoid letting valuable employees go. The outcome for those valuable RIF’d employees can be better, though, than the outcome for one fired for cause. That is, it can be easier to get another job because they did not leave their last one under a cloud.

And, as my former boss used to say, life isn’t fair. No point in bemoaning that, just deal with it.

The good employee finished his work, and so he gets laid-off. The bad employee drags his feet and never finishes, so he continues to work. This is a sign of a bad employer, who keeps his bad employees letting good employees go.

Basically a CYA move. If you fire someone, you want documentation so you don’t have to deal with potential legal hassles.

I have never worked anywhere that got rid of the good employees during a reduction in headcount. The company always knows who the bad employees are, and they’re the first ones gotten rid of when they need to reduce employee numbers - it’s an easy way to get rid of them without having to jump through the hoops otherwise needed to protect against wrongful dismissal suits.

However, every times I’ve worked somewhere that had a headcount reduction, all the bad employees who were reduced thought they were the good employees.

That’s true, as best as I can tell, although I’ve worked in a few places where the bloodletting was so severe that they went through all the incompetent, semi-competent and started into the competent, but unpopular people before it was all said and done.

But overall, Roderick Femm has it right.

Sometimes there are orders to “fire x% of each department” regardless of things such as having just duplicated production and shipment volumes (the order came from someone calculating ratios using current people vs several years prior production and shipping), or “fire your 6 newest people” regardless of things such as 4 of those being in training to replace the about-to-retire 4 oldest (yep, the factory did have 6 more people than they had the previous year; the other 2 ‘extras’ were part of an authorized move to increase lab coverage). In those cases, unless the people receiving those orders have enough of an incentive and enough reasons to explain why those are very boneheaded moves, the results are going to hurt the company.

It’s extra fun when the orders come from one country to another where the social and legal background are very different. Ideally yes, I agree that when people do have their head screwed on right, the choices are the logical ones.

Here’s my favorite failed incentive: the Republican legislature in NC, trying to distract from the series of pay freezes teachers got, passed a law.

25% of teachers in each district would get raises of $500 a year for three years. (The law was not entirely clear whether this would mean 500, 1000, 1500, 0 over 4 years, or 500, 500, 500, 0 over 4 years, or something different). The other 75% of teachers would get no raises at all.

Only teachers with tenure would be eligible for these raises.

Those teachers who got the raises would have to sign an agreement to give up tenure.

The district would have to choose how the 25% of teachers were chosen.

The weapons would be placed at the center of the rings representing the twelve districts.

All of that is true except the last sentence.

I, and many other teachers with tenure, signed an agreement to take ourselves out of the running for these “raises,” which had the effect of pitting teachers against one another in one of the worst environments for discouraging cooperation. Eventually a judge declared the law to be in violation of NC’s constitution, and the law was repealed.

I’ve never seen a greater failure of an incentive.

I have been exposed to company downsizing nearly my entire adult life. I noticed something curious. Many employees who fret about being ‘good employees and it’s just not fair’…weren’t really good employees. They tended to be complainers and general malcontents. Most companies keep the folks that can be counted on.

Every now and then, though, a really good employee gets cut. This can often mean that employee makes too much money. Or they are just afraid they will not be able to keep him\her because they cannot offer any more money. Why keep them if you are just gonna lose them later down the road.

My biggest hit to incentive has always been performance reviews - and I always get good - great scores! Here are things I’ve been told by various managers at evaluation time:

[ul]
[li]HR only lets me rank one person as “exceeds expectations”, and since you’ve gotten “exceeds expectations” for the last three years, I have to put you at “meets expectations” this time and give someone else a chance at “exceeds”.[/li]
[li]You did a great, consistent job this year and I honestly can’t think of a single thing you need to do better at. But I’m not allowed to score anybody at 100%, so I marked you down on <this trivial stupid nitpick>.[/li][/ul]

There was the company where I was good - great consistently for more than 5 years with no word about promotion in a company with 6 ranks for every job title. When I finally asked for the rank promotion (engineer level 4 to engineer level 5), not a title change, it took more than two years to get approval and I finally gave up and left the company.

I also experienced what it’s like to be the Golden Child Who Can’t Do Wrong and that’s not as motivating as you’d think. During that time, my review discussion when something like this:

manager (doing the “citizenship” items): Are you always polite and professional to coworkers?
me: yes, I try
Manager (writing): yes
Manager: do you always answer the phone before the third ring?
Me: not always, sometimes I don’t get to it in time
Manager (writing): yes

It was demotivating because when I realized they didn’t hold anybody accountable I realized I just didn’t give a shit. I wasn’t surprised when my Golden Child status was later very suddenly revoked for political reasons (and then of course I couldn’t do anything right).

I’m guessing you’ve never worked in banking during a recession. The first few rounds of layoffs go as expected, one can pretty much list the folks that will be in those waves before they happen. When the next wave of layoffs is announced and you look around and think “Um, I don’t see any more average employees, much less bad ones” - that’s when it gets scary.

I have always felt more demotivated after receiving my performance review even when they’re excellent ones. The whole process is political, and it’s soul-killing.

I’m guessing you’ve never worked in the chemical industry, where the layoffs are so regular that there are no good workers left for the next round of layoffs to cut (because they’ve all gotten other jobs… since they’re good at what they do). Is there some sort of misery prize we’re competing for here? 'Cause I think I’m still in the running.

I’ve been campaigning for years to either toss out or at least modernize our performance management system. It is the most disincentivizing program imaginable. It is solely based on expected outcomes and is rampant with cronyism.

Each department, no matter what size, is allotted one T (top performer) one E (exceeds expectation), two B (below expectations), and the remainder of employees in the department get S (satisfactory). It doesn’t matter if you have 16 fantastic employees or 16 slackers, your results must match expected outcomes.

As someone above has said, you cannot choose the same individual as your T two years in a row. And no one can receive two consecutive B ratings and not be terminated.

It all looks very good on paper - nice and tidy. But in reality, it’s an idiotic system, respected by no one, that adds nothing to the quality of the company’s personnel.

BTW, I’m in the chemical industry as well, and reorganizing (ie downsizing) regularly is our credo.

Not that I know of, but if we are competing I’m rooting for you to win! :slight_smile:

You were adamant that you had never seen it, I was sharing that I have - multiple times. Depends on the industry and employer. I have seen RIF’s where a project is identified as “insufficient ROI” and everyone working on the project was released, regardless of position, review history, etc. It makes it easy for HR to justify. It’s stupid, but easy.

What I’ve seen is, if they’re keeping anyone, they don’t downsize the good workers while giving the bad workers a warning and another chance, as the OP implies. If everyone is being downsized, everyone goes - although most of the time in my experience openings elsewhere are found for the really good workers (without much in the way of an interview process, either).

Most of the companies in my industry force-fit performance reviews to a bell curve, too. So yes there’s a mandatory 10-20% “good” and 10-20% “bad” performers, even if everyone you have is a good performer.

But that doesn’t really phase me, because I’ve actually been required to go on 24/7 coverage in 12-hour shifts because management felt that the problems in our area were due to “bad attitude”. However, they didn’t want the (professional) employees on coverage to annoy the (union) operators… so we were only allowed to go into the unit no more than 5 minutes every other hour. Even though what we were supposed to be doing was verifying the step times being recorded by the operators. And the operators figured out that they could complain about people on coverage hovering over them (i.e., exceeding their 5 min/2 hours), and get those people a talking-to about it. (Fortunately, the operators liked me.)

Oddly, this did not improve the “bad attitude”. How’s that for incentivizing performance? Yeah.

Obviously you never worked at GE in Jack Welch’s prime or at Microsoft in the past 6 years or so. Mandatory manage out 5% of staff in every group per year every year. Not so hard on year one or two, a lot harder to find deadwood in year 5, real hard to find deadwood in a 5 person team year after year. It’s pretty toxic.

As to the OP, the deadwood are the very first to go. Managers save them through out the year to they are part of the bottom 5% that get managed out. Because, guess what, if you let deadwood go during the year, what happens at the end of the year? You still have to cut 5%.

This is what happened to me in December. My company went into the new and growing field of solar energy, and I transferred in, then a few years down the line we were unable to compete with the Chinese despite all the hard work that we did, so our entire division was shut down. I was laid off after 23 years of excellent work, according to my reviews. A lot of equally good people were let go along with me.

Setting aside that these are two different sets of circumstances, it’s not entirely accurate. Everywhere I’ve worked, layoffs followed certain criteria: the first people eliminated are those on any sort of documentation for attendance or performance. The bad apples were always the first to go. There was often some dispute about this among employees - some popular person everyone felt was going thru a rough patch, when they’d rather get rid of the person with OCD despite them never missing a day or screwing up.

If that didn’t deliver enough targets (which was rare), you went for people with the poorest recent performance evaluations. Either way, your bad employees were always the first to go, provided the manager documented their performance properly.

Layoffs are due to economic conditions, loss of funding, new competitors, stupid management mistakes etc. that result in needing to get rid of headcount, offices, divisions, teams, product lines, etc.

Firings / Warnings / Performance plans are an HR issue. That is why you have to be damned careful.

I have been the guy who did both. I have put people on plan, and then fired them. Painful, but I had to follow a process to get rid of the dead weight.
I have also had to lay off large groups. That really sucked. I had the joy of telling scores of engineers, sales reps and a marketing team that we were not going to follow-through on a new product and company expansion that they were all hired to pursue. Close to 50 people by the time I was done, and I met with every one of them individually.

The next week I walked into the CEO’s office and laid myself off.