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The bottom lines in workforce retention vs. reduction

November 30, 2022 | 04:43 pm PT
Dang Quynh Giang Lawyer
I was shocked and saddened recently when a colleague called to inform that a 55-year-old coworker had died of heart failure at home the night before.

He was a company veteran, having worked with us for 17 years.

After getting a grasp on the situation, I called my boss. He exclaimed "Oh my God" in heavily accented Vietnamese and asked me to let him know when he could pay a visit.

An appointment with an important partner prevented him from attending the funeral. A week later, I was asked to arrange a post-funeral meeting between him and the wife of the deceased worker.

When she arrived, I took her to the boss’s office. He offered his condolences. Having learnt about the family’s situation, I was about to speak on her behalf when he said: "Let her speak. I want to talk to her directly." So I interpreted for both.

The little woman was somewhat shy in front of a big Western man, the general director of her late husband's company. But before his considerate attitude, she gradually opened up and articulated her concerns about a life without her husband, who had been the pillar of her family.

My boss tried to get as much information as possible about the woman's family circumstances. He cared most about the future of her only daughter. He said the company did not want her father’s death to hinder her studies and promising future.

He consoled the wife and told her to focus on taking care of her child and rebuilding her life. He emphasized that the company was committed to establishing a scholarship fund to financially support the daughter through college. And as he saw her off, he told her to reach out to him and his wife without hesitation should she have any difficulties in the future.

After she left, my boss asked me to calculate all the expenses that the woman's family had to bear and estimate the amount of money she would receive from the insurance agency and the union. The next day, we informed him that the family's funeral and related expenses and what they would receive were almost the same.

My boss sighed and decided that the deceased worker’s current salary would be paid monthly by the company to his wife’s account until the child graduated from college.

Workers in a textile company under the Vietnam National Textile and Garment Group. Photo by VnExpress/An Phuong

Workers in a textile company under the Vietnam National Textile and Garment Group. Photo by VnExpress/An Phuong

This family is not the first to receive this type of assistance from my company. The number of employees or relatives getting financial assistance for various reasons is 14. When an employee is physically ill, injured in a car accident or no longer able to work, or has no family to care for him or her, the company does its utmost to assist them. They receive monthly financial support from the company. There is one individual who has received this type of benefit for eight consecutive years. I remember that we were once required by the insurance agency to provide a valid explanation for this situation because all of these individuals' financial spending information was accessible from the tax office, but no corresponding social insurance payment was being made.

Given the current difficult economic situation and the fact that the company itself does not already have a very strong financial foundation, its leaders have had to exert great efforts to balance revenue and expenditures to maintain such a welfare policy.

The general director speaks with me often after work to better understand the lifestyle and personal circumstances of his employees. He is a British businessman who has been working in Vietnam for 28 years. With regard to his work, in addition to business development, he is most concerned about improving the life of every single employee. After what I have seen, I can say that this is not just lofty rhetoric. He means every word.

I tell this story because Vietnamese businesses are in a tough situation, given the ongoing global recession (though it might not be classified as such). The lack of orders and raw materials for production; as also the lack of capital are among main factors forcing businesses to downsize production, reduce working hours, and even cut down on their workforce. Many businesses have already planned to "treat" their employees to a 3-month Lunar New Year break.

According to the Ho Chi Minh City Employment Service Center, more than 10,440 people applied for unemployment benefits in October. The total number of people who lost their jobs in the past 10 months is estimated at 128,000, up 26% over the same period last year. There are companies that have had to lay off around 2,000 to 3,000 workers, mostly seasonal or older workers.

These numbers demonstrate a strikingly different situation than in previous years. Towards the end of the year, instead of massively recruiting more workers to fulfill orders, companies have been laying off large numbers of employees. This is a serious socioeconomic problem that every business needs to tackle and overcome in order to survive.

However, in this difficult context, the actual quality and reputation of businesses will be reflected most in the way they support their employees during tough times.

My boss's top priority at the moment is to do everything possible to retain his employees. He has been traveling more frequently, meeting and working directly with partners more often to try and expand our customer network outside of our traditional markets. All his efforts are aimed at increasing the number of orders and helping workers keep their jobs for as long as possible.

He says that after working in Vietnam for 28 years, he understands what a proper Tet celebration means to locals, including those who have to leave the country in search of a good job to make enough money and hopefully reunite with their families that live in isolated and underdeveloped rural areas.

Laying off employees to save costs is always an easier option than holding on and supporting them in times of crisis.

The current wave of staff reductions will generate great social pressures in the future, when a large number of workers become unemployed and excluded from social security and insurance policies.

Businesses must realize they have to operate for more than just the net profit of their upper management. In exceptional circumstances, they must also share benefits they have gained with their employees, who contribute significantly to the firms' strength. Indeed, it is the social responsibility of businesses to stand by their employees in times of distress.

I believe that the more businesses in a country that are well aware of their social responsibilities, the faster that country will recover from a recession and have a better chance to achieve sustainable development.

*Dang Quynh Giang is a Vietnamese lawyer.

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