When HR departments do things right, nobody really notices them.
When HR departments make a mistake, people notice. If it’s bad enough, a lot of people notice.
One might be right to say the HR profession is not for everyone. As if your job wasn’t stressful enough already, you are one step away from dominating the headlines for the wrong reasons. Is HR really boring? Here are some case studies that made it to my memory over the years.
Case Study 1: Here's your bonus, oh and also your new vacation leave days :)
The mistake: Anticipating a payout of bonuses, the country lead had an amazing idea to distribute the profits, but at the same time leave his bottomline in check. Instead of paying just handing out the bonus as budgeted, he thought it would be a good idea to reduce the number of annual leave entitlement to "regain" the dollars.
The aftermath: Before the news was announced, a few HR folks who were strongly against the idea resigned as they could not convince the Country lead otherwise. Once the news was announced, all hell broke loose. Many employees were calling for the lead to be fired, while almost none of them kept quiet about it. Though the decision was eventually revised, many employees have likely changed their mind about working there for the time being then.
How it could’ve been avoided: Let’s imagine for a second that this wasn't done on purpose in order to cut costs. Instead, we’ll assume a more common practice among businesses: All salary increments, rewards and payouts are dependant on multiple factors including business performance. If they failed to hit the business goals initially set and forecasted, then there might not be any bonus payout triggered. By coupling this with proper communication, you can ensure that employees understand the prerequisites of variable bonuses from the start.
Case Study 2: Hey, I have financial commitments, where's my money?
The situation: Employees expects to get paid for their work on time. So when the 300+ employees one Friday morning to find that their salaries didn't appear in their bank accounts as expected, naturally they remained calm and went about their day.
Just kidding! They freaked out.
It turned out that there were some error in the bank file given to the banks (and you won't know until it bounces back from them. weird right?). To make things worse, it was the weekend before New Years' Eve, which means some amendments can only be effective to reach employees after new year. Yes, what a way to start the new year.
The aftermath: Swift but precise mass communication signed off with the Boss's name detailing the 5W1Hs (what, who, why, where, when, how). By then the damage had already been done. Employees reported getting insufficient funds and interest charges from credit card bills with their bank etc.Most employees eventually received their payment by Saturday, some latest Tuesday depending on which bank they signed up for.
How it could’ve been avoided: Employees’ salaries are too critical and super correlated to their happiness index. One vital step the payroll team could have done is to complete what we call a "penny test" on the bank file (say a dollar, if it's the minimum denomination to transfer). This will allow the team to rectify any rejected bank details in time for amendments to be made before the actual payday.
Heres a tip for employees like you and me: Register for a salary account of the same bank your organisation uses for salary crediting. Any issues with payroll will usually be resolved faster since the transaction is made within the same bank.
Case Study 3: You’re retrenched, I think.
The mistake: The company couldn’t catch a break. Between moving teams for shared service concepts to margin depleting businesses, it looked like the company was playing Bad Decision Bingo - and winning. It all began when it was revealed that a group of employees were to be made redundant, some of them found new roles within the organisation. When we thought was over, there was a second, then third and a recent forth round since.
The aftermath: Unnecessary speculation of future layoffs making rounds until the trust is regained from employees as they fear by "Could I be next?" on a regular basis. Many I knew started looking out in desperation from a potentially sinking boat.
How it could’ve been avoided: This is a great example to show how one slight miscommunication between departments can lead to drastic, irreversible harm. Good luck trying to get your employees to trust you again after you told them this is a one time exercise. Do your homework well. Prepare all the necessary calculation before you decide on who and why each individual has to be let go. As the decision is made to let an employee go, walk through every step needed to be taken— notifying and involving stakeholders ALL the way. Yes, we know people better than you do ;)
Case Study 4: Guess who is taking over?
The mistake: The then new incoming CEO wanted to replace a director in the office. As usual, no one wants to rock the boat and a confidential search begun. The candidate was found, offer signed and all good to go. Guess what? Someone notified the incumbent. No it wasn't the headhunter, nor anyone in the company. It was the director's friend and unfortunately, also the husband of the candidate about to replace you know who...
The aftermath: Hell broke loose again. We lost the director through drama, and while managing that the candidate withdrew herself from joining the company. You bet words were out there leaving us with bad remarks. Negative PR indeed.
How it could’ve been avoided: It doesn't hurt to be truthful. Yes we may need time to look for a replacement before we let this one go, but there are so many things that can go wrong. As Murphy's law states "whatever can go wrong, will go wrong". Prevention is better than cure. Try to strike a balance between business needs and being fair to employees. Create a open conversation to discuss what is required for the role and the actual plan. If the final decision is still to part ways, give employees ample time to prepare their exit while looking for something for themselves. We all need to survive. Showing employees some empathy will go a long way. Work with them on how they want the exit plans to be communicated so no one will be surprised along the way. Besides, you get to openly post the job up to improve candidate pipeline. How good is that?
Is HR still boring?
So many other interesting case studies you could ask around really! Oh, did I mention our awesome @Sam Neo just started his new adventure - Stories of Asia? Read/hear more from the man here: https://www.linkedin.com/feed/update/urn:li:activity:6506675135653736448
Contents of the case studies are mostly adjusted for illustration purposes. No part of this article are directed at any Businesses, and any resemblance to real organisations, events, or settings are entirely coincidental. Tried using some animated gif images to create a more casual atmosphere for this post. Let me know if you like it!
Peace!
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