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The Voluntary Redundancy Option: Carrot or Stick?
Author(s) -
Clarke Marilyn
Publication year - 2005
Publication title -
british journal of management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.407
H-Index - 108
eISSN - 1467-8551
pISSN - 1045-3172
DOI - 10.1111/j.1467-8551.2005.00457.x
Subject(s) - redundancy (engineering) , incentive , retrenchment , turnover , workforce , business , computer science , economics , microeconomics , political science , management , public administration , operating system , economic growth
Voluntary redundancy is a relatively new form of retrenchment that has become a popular means of reducing workforce numbers in downsizing organizations. Voluntary redundancy involves the offer of a financial incentive to encourage employees to ‘volunteer’ for redundancy. Using the findings of a small study of individuals who had taken voluntary redundancy, this paper explores the voluntary nature of voluntary redundancy and suggests that both organizational change and the financial incentive are contributors to the redundancy decision. From an organizational perspective voluntary redundancy does appear to smooth the downsizing process but at the same time tends to mask underlying issues of morale and commitment.