The suspiciously bulky envelope arrives and the immediate reaction is panic: It's buyout time and employees must begin the difficult process that ends in staying or going.
For managers, the process can be particularly painful. Chances are these employees have invested several years in the company, and now their managing/utilizing/facilitating may be seen as no longer necessary.
But cheer up, experts advise. There are ways to manage your own downsizing.
"Some people think a buyout is like a divorce: 'Ah, they've used me up and they're throwing me away,' " career counselor Richard L. Knowdell said. "But it's not like a divorce. It's an opportunity to get back in the driver's seat career-wise."
Buyout candidates should use the same skills that make them good managers to evaluate the buyout offer and their own skills and careers, to perhaps negotiate some-thing better, and to maybe--and this is the longest shot--head off that buyout offer in the first place.
It's no secret that in these times of corporate downsizing, the ranks of middle management are the favorite hunting ground for early-retirement or voluntary severance programs. Some corporations are slicing out entire layers of management in the hope of competing more effectively.
Buyout programs vary widely, usually offering employees a cash payment based on salary and years with the company. The lump-sum payment might range from six months to 18 months of salary.
Companies also usually provide a temporary continuation of medical benefits. Early-retirement programs might also include higher pension payouts to make up for retiring ahead of schedule.
Sometimes buyouts leave room for negotiation, not just for more money but perhaps for a different departure date or a low-price purchase of a company car.
Managers who are expected to stay on for a while or to perform special tasks for their company before they leave are in the best position to ask for more, said Robin Ferracone, senior vice president of Strategic Compensation Associates, a Los Angeles-based executive compensation consulting firm.
"They might say, 'We want you to stay around for a year and get this done and get that done, and then we don't need you,' " Ferracone said. Such managers, especially the higher you go on the corporate ladder, frequently can demand retention bonuses, ranging from an extra few months of salary to an entire year's pay, she said.
Buyout candidates shouldn't be seduced immediately by what at first appears to be a very large amount of money, cautioned career counselor Susan W. Miller.
"A lot of people are tempted to take the money and run, but you have to evaluate realistically a variety of factors: your age, what your skill set is, your financial condition, your financial responsibilities," said Miller, who co-owns a company called Vocational Training Consulting Services. Job hunters frequently underestimate how long it will take to land another position, a process that can take three months or more than a year, Miller said.
Knowdell said a buyout should prompt employees to do a serious accounting of their skills and other ways they could put them to use.
"If someone offers to buy your car, before you accept or turn them down, you should go out and see what other cars are available for the money you've got," said Knowdell, who also heads the San Jose-based Career Planning & Adult Development Network.
After researching what jobs are available and what they pay, workers need to focus on what they want and then develop a strategy for getting it, Knowdell said.
And here's a thought: There may be ways to keep the buyout boys away. It comes down to being an employee of recognized worth.
"Subordinates have an awful lot of influence because there's a lot that the boss needs from subordinates," said David Bradford, a Stanford University senior lecturer in organizational behavior and co-author of a book titled "Influence Without Authority," which explores ways of influencing the behavior of people over whom you have no direct authority--like your boss. He described a situation in which an employee facing a downsizing might tell the boss, "I have a feeling I'm going to be out of here, so here's what I would like to do in the next six months," and then propose assignments that would build valuable skills, look good on a resume and fill the supervisor's need for hard-working employees in the midst of the sort of paranoia and paralysis that work-force shrinkage can create.
The employee then is transformed from a victim into an active manager of his or her career, with an added advantage, Bradford said. "It turns out that the more influence you have, the more valuable you will be. It's the scared-deer-caught-in-the-headlights who gets fired."