Outplacement agencies: how to find a good one


Outplacement agencies: how to find a good one

With gloomy predictions of rising unemployment and large-scale redundancies in 2009, the role of “outplacement” agencies may become more important and their services will be in heavy demand. This article looks at the scope of their role and provides tips on how to choose a suitable agency.


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With gloomy predictions of rising unemployment and large-scale redundancies in 2009, the role of 'outplacement' agencies may become more important and their services will be in heavy demand. This article looks at the scope of their role, and provides tips on how to choose a suitable agency.
An image problem?
The term outplacement irritates or amuses some people. It is very obviously a euphemism for dealing with termination of employment, and that has connotations of face-saving or window-dressing for some. So it is important to be clear about the role and scope of the outplacement process.
Outplacement is not merely ensuring that the redundancy process is handled legally and humanely, with access to counselling provided — it also involves providing various forms of assistance to find other employment. Remember that it is dealing with terminations that are in no way the employee’s fault, they are caused by economic issues.
This means that it is catering for employees who often have been employed by the same organisation for a long time, and who have little or no recent experience at seeking new employment. The same people may also have reached an age where finding other suitable vacancies can often be difficult.
Further, in difficult economic times, there may be extra financial pressures to find other employment quickly because the retrenchment was sudden and unforeseeable, but the employee still has financial commitments to meet and there can be big problems once the severance pay is used up.
Finally it is in both parties’ interests to end the employment relationship on good terms if possible. Long-serving employees, particularly senior ones, can often be quite influential in the community, and could be capable of damaging your business and/or helping your competitors if they become embittered.
Outplacement has the ability to preserve a good relationship, and to reinforce to other employers that a redundancy was genuine. Note further that when things start to pick up again, most businesses will have to hire new employees, and ex-employees who were retrenched are often very suitable — if they actually want to come back.
Should you outplace outplacement?
The arguments for using an external outplacement provider are usually stronger than those for providing the assistance in-house, but both approaches have their advantages.
In-house outplacement assistance has the following benefits: 
  • it’s cheaper;
  • the employer often knows its own industry and markets better than an external consultant, and may have more direct contacts it can use;
  • because the employer will usually be perceived as having nothing to gain from approaching other employers, it may be perceived as being more credible than an external agency that stands to gain an agency fee from placing the employee.
On the other hand, an external provider:
  • may be regarded as more credible by the retrenched employee because it was not associated with the original retrenchment decision – sometimes employees are more receptive to an 'independent' and 'impartial' source;
  • has more resources and experience for handling redundancies;
  • may have more contacts, if it knows the industry well;
  • can offer a much wider range of services and assistance – see below;
  • saves time for the employer;
  • allows the employee to 'move on' at an earlier stage because the psychological relationship between the employee and employer is more clearly severed. 
The scope of outplacement services
The range of outplacement services varies between providers, but the following is a typical list: 
  • helping the employer to plan and implement the redundancy process — may include training the employees who have to implement it, eg role plays of redundancy interviews;
  • calculating and/or checking redundancy entitlements;
  • counselling for affected employees, which may involve their family members as well — the counselling may include emotional, psychological, financial and practical issues;
  • assistance with CV and job applications preparation;
  • training in employment interview and telephone techniques;
  • administrative support during job seeking process, eg access to an office, internet, email and secretary;
  • arranging contacts and leads that the employee can follow up. 
Many providers will also offer counselling for the organisation’s employees who are NOT made redundant. There is increasing evidence that 'survivor guilt' becomes an issue in many organisations, and if not treated may result in anger (extra workload, perceived injustice), depression (empty office stations, low morale, concern for their own futures) or sabotage. Increased turnover, because of all these reasons plus a 'jumping off the sinking ship' reaction is also on the cards.
Choosing the right provider
The important issue here is that it is more important to meet the needs of the affected employees than those of the organisation itself. The provider must be able to help employees cope with the redundancy and give them the best possible chance to find other suitable employment quickly, if that is what the employee requires.
The requirements for senior executives will be very different to those for unskilled factory employees – 'one size fits all' does not apply here. If an organisation has retrenched a wide range of employees at once, it may have to consider using more than one outplacement provider.
Key issues to consider include the following:
  • the provider’s area(s) of expertise or specialty;
  • its track record — look for evidence of how it has handled redundancies on behalf of other employers;
  • the experience and reputation of its staff — counsellors, planners, financial advisers, job search consultants, etc;
  • its knowledge of your business, industry it operates in, markets, contacts, etc;
  • the resources and range of services it can provide — how well do these match with your employees’ needs;
  • location — needs to be readily accessible to as many employees as possible;
  • cost versus benefits.
Negotiating the contract
The normal procedures and cautions that apply to negotiating any contract with an outsourced provider apply to outplacement providers and consultants as well. See writings on contracts of employment generally.
Redundancies can be very stressful for both the people who are retrenched and those who implement the retrenchments. Outplacement assistance is a recommended way to reduce the stress and logistical problems in a practical and constructive way.
However, it is not a 'cure', nor a prop for lazy managers to pass the buck. Sensitivity and professionalism in-house are still essential, and a partnership with a good outplacement provider can help to maintain them.
Source: Mike Toten, HR writer.
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