How to Evaluate and Eliminate Positions During Restructuring
Approaching layoffs with clarity and care can turn a difficult moment into an opportunity for organizational growth and resilience.
Deciding which positions to eliminate during a corporate restructuring is one of the most challenging tasks HR professionals face. It’s a conversation no one wants to have, yet it’s crucial to ensure the long-term health of the organization.
While eliminating positions tied to non-critical functions is relatively straightforward, handling duplicate roles, such as choosing between two accountants, can feel like navigating a minefield. Should you prioritize tenure and experience or lean toward cost-efficiency with a less experienced employee? What role do performance metrics and organizational needs play in these decisions?
How these decisions are made is not just an operational concern—it’s a legal and ethical one. Organizations must document and justify their choices, as these decisions may be scrutinized in court if a terminated employee challenges the layoff process.
Disclaimer: We are not lawyers. This article is based on HR best practices and professional experience. Always consult legal counsel to ensure your evaluation process complies with federal and state laws.
4-Step Checklist for Evaluating and Restructuring Positions
Step 1: Define Restructuring Objectives and Identify Core Operations
Clearly outline the goals of the restructuring process.
Identify which operations are essential to achieving the organization’s objectives.
Step 2: Assess Performance and Redundancy
Evaluate KPIs: Measure each employee’s performance relative to their role’s key performance indicators (KPIs).
Assess Redundancy: Identify whether the responsibilities of a position can be absorbed by other roles without overburdening remaining staff.
Conduct Financial Impact Analysis: Weigh the cost of maintaining a position against its contribution to the organization.
Step 3: Explore Reallocation and Compliance
Determine whether the position can be reallocated to another department or restructured to meet new organizational needs.
Assess employee skill sets for potential redeployment.
Ensure compliance with collective bargaining agreements, as well as state and federal laws, to avoid legal complications.
Step 4: Apply the Position Determination Formula
Essential Operations Formula
Calculate the minimum number of positions needed to maintain critical operations.
Compare current staffing levels to these minimums.
Position Elimination Criteria
Develop a scoring system to evaluate positions using the following factors (scored 1–5):
Contribution to core operations
Financial impact
Redundancy
Employee skills and transferability
Positions with the lowest total scores are prime candidates for elimination.
Why a Thoughtful Process Matters
Restructuring is never easy, but with a structured, transparent approach, organizations can make informed decisions that minimize risks and build trust. A well-documented process not only helps maintain morale among remaining employees but also provides a legal safeguard against potential disputes.
Download Our Free Comprehensive Checklist
To help you navigate this process, download our Comprehensive Checklist for Evaluating and Restructuring Positions.
Is your organization facing a restructure with workforce downsizing on the horizon? Let us guide you through this challenging process with expertise and care.
