Sep 04, 2009

Reduce Payroll by Reducing Hours and Making Select Layoffs

Here's the eighth big-picture strategy from my save your business list:

8. Reduce payroll by reducing hours and making select layoffs.

As we discussed in a previous blog post on cutting costs but avoiding layoffs, before laying off good workers you should try cutting employee benefits, salaries, and the number of hours employees work per week or month. If you've instituted thee measures and are still operating in the red, consider laying off nonessential workers, perhaps those who aren't as productive as others or who aren't willing to learn new skills. For a good article on how to choose who to layoff, as well as how to stay out of legal trouble when you terminate employees, see the article Making Layoff Decisions in Nolo's free Legal Encyclopedia.