BRIDGING THE GAP
Arne Hellmuth, Managing Director, Transformation Solutions at LHH discusses Workforce Planning Designed for an Age of Unprecedented Challenges
It is one of the strangest and most compelling workforce planning challenges I have ever witnessed in the global labor market: millions of workers displaced by COVID-19 at the same time that millions of new and emerging jobs are being created.
Airlines have been grounded but online retailers are struggling to keep up with an unprecedented surge in orders. Hotels, restaurants and bars have been crippled, but the manufacturing of a wide array of products such as Personal Protective Equipment and hand sanitizer has soared to new heights. Jobs in tourism have largely evaporated but work in fields such as security and health care are growing at a steady pace.
The question I kept asking myself is whether the human capital industry—the firms and experts that employers turn to in times of change and crisis—is doing enough to come up with innovative solutions needed to address this unprecedented labor phenomenon. One thing is for certain: our traditional solutions may not be enough.
Options such as career transition are always going to be a critical element in the ebb and flow of workers. Even now, while countries move toward safely reopening and companies evolve their business models in response to COVID-19, career transition is set to play a vital role in how an organization can both support displaced workers and protect the employer brand. But today’s unique labor market conditions demand that we develop more meaningful ways of helping workers and organizations through this crisis.
At LHH, we saw an intriguing opportunity to explore new ways to build a secure and orderly pathway between companies that need to temporarily shed workers and find them work with organizations that urgently need to hire. The only thing we knew for sure at the outset of our project was that initial attempts to match labor supply with demand have been met with mixed results.
In March, CVS Health Corp.—one of the world’s largest health care and pharmacy companies—announced that it needed to hire 50,000 new employees to help meet a surge in business created in part by the pandemic. To source these hires, CVS reached out to companies like Gap Inc., Delta Airlines and Hilton Worldwide Holdings, all of which were forced to lay-off or furlough hundreds of thousands of employees around the world.
CVS earned significant positive publicity for its gesture, but it was not without some unexpected consequences. Partly because of the publicity, CVS received more than 900,000 resumés for its 50,000 openings. In a situation that requires an agile and expedited response, CVS created a HR challenge of enormous proportions.
What we really needed to make this happen was a way of curating the movement of employees in a way that was more deliberate and controlled. What we needed was an “Employment Bridge.”
Conceptually, the Employment Bridge would be a mechanism that could take surplus workers at one company and find them temporary employment at another company, while allowing the original employer to retain the ability to recall them when and if business turns around. It’s a fairly straightforward idea but the implementation had the potential to be quite complicated.
Different countries have different legal demands to reduce workforce. In some places, it’s relatively easy to layoff or furlough employees; in other jurisdictions, particularly in Europe, layoffs and furloughs are complicated by multiple layers of legal protocols. To make the Employment Bridge a reality, we’d have to find a way to move workers that all parties involved—the individual, the companies, governments and unions—could support.
Part of our solution was found at Modis, a global provider of IT, engineering and life sciences personnel and solutions that operates within the Adecco Group of companies. Working together, we devised a mechanism to allow originating companies with an oversupply of workers to “lend” their people to Modis, effectively suspending but not cancelling their original employment contracts. Modis would then contract out these employees to other companies that need to expand their workforces.
It’s a simple, elegant solution where all parties benefit. And it’s very quickly gone from the theoretical to reality.
LHH and Modis have just completed a pilot project with two large European companies that will eventually lead to the migration of 6,000 employees across the Employment Bridge.
How has this gone so swiftly from theory to reality? A quick examination of the terms of the Employment Bridge shows that the advantages to the individuals and the originating company are numerous.
First, employers can reduce their payroll without having to cover additional severance and separation costs. When many companies have recently seen drastic and precipitous declines in operating revenue, it is critical to find the most cost-effective way of reducing headcount that protects workers and protects businesses from vulnerability.
The Employment Bridge also offers originating employers the right to recall their workers when business starts to return to normal. The retention of key talent is a huge advantage that gives companies particularly hard hit by the pandemic the best chance to ramp back up to normal operation, as quickly and as cost-effectively as possible.
Individual employees can also reap multiple benefits from the Employment Bridge.
Workers ultimately get the opportunity to gain new experience and skills by working at another organization. And under the terms of the agreement with the destination company, employees are guaranteed to earn comparable wages and benefits.
The COVID-19 pandemic has, in many ways, transformed some of the assumptions we have made about workforce planning in the midst of an economic downturn. The human capital industry simply cannot only offer traditional solutions when faced with a non-traditional challenges.
The Employment Bridge is our new solution for a new and unprecedented challenge.
Reprinted with permission from LHH: Transformation Insights Vol. 3 No. 10, 2020