A Plant Closure Checklist (For HR Professionals)
February 19, 2019 by Josh Hrala
A plant closure has many moving parts that all need addressed by various departments and staff members. For example, someone will have the oversee the physical shut down, someone will have to get the building ready for sale or rent, and someone – most likely the HR professional – will have to oversee how to offboard staff members. This is where a great HR-based plant closure checklist can come in handy.
A plant closure checklist is a simple document that can help you stay on track during a plant closure by allowing you to quickly and easily showing you what needs done and in what order. You can download our sample plant closure checklist here:
Let’s explore what goes into a plant closure checklist in a bit more detail so that you understand the steps.
Plant Closure Checklist: Part One
This guide will assume that your business has already done everything in its power to save a plant from closing. However, if you are unsure of these methods, you can check out our resources here, which will go over how to stave off layoffs in general by using furloughs and other alternatives.
That being said, HR’s role in a plant closure is very similar to any reduction event. You have to first start by understanding who will be let go – if any.
Sometimes, a plant closure can force the impacted workers to relocate to a new plant, saving the need for layoffs. The sad reality, though, is that this is far less common than simply holding a layoff event.
So, this means the first step is to analyze the workforce at the plant to come up with a detailed list of those being let go and if there are possible positions for them elsewhere in the company.
You can learn all about our employee selection process here:
tionYou should also make a list of goals that this event wants to accomplish. Then, consider how the event will play out in the court of public opinion and things of that nature. This section can be a bit all over the place, but the real takeaway here is that you need to thoroughly understand the event before it occurs.
This section can look like this:
- What outcome do you want to achieve? (What is the problem?)
- Are there alternatives? (Furloughs, temporary layoffs, etc)
- Is this the right time to hold an event like this?
- What positions will be impacted by the move? (Locations, departments, teams, etc)
- What will this achieve?
- How do you control the public narrative? (Give your outbound employees the red carpet treatment, help retained employees with their survivor guilt, etc.)
Plant Closure Checklist: Part Two, Planning The Event
After you have completed step one and have a list of those being let go, you need to start planning the offboarding process. First, we recommend having all of the necessary resources to make the layoff event go smoothly.
You can download some of the most used ones here:
You’ll need to figure out what team is going to identify those being let go, what locations will be impacted, start setting goals based on analytics that dig into how many people need to be impacted, and how that will work towards stabilizing your business. This is a bit easier for a plant closure because you have already determined that the entire plant will be shutting down operation.
Next, create a timeline. Examine if you need to take any other budgetary steps (bonus cancellation, hiring freeze, etc) to ensure success in the future.
Finally, you need to remember to draft a plan on paper for your legal counsel to look over. There are tons of rules on the books to make sure employees are not terminated inappropriately, especially for workers over 40 years old.
For plant closings, you also need to be prepared to file a WARN notice, as defined by the WARN Act. You can learn everything you need to know about the WARN Act and if you are need to comply with it here. Also, checkout our checklist here:
Here’s what this section can look like in your plant closure checklist:
- Establish criteria. You can use this guide to help.
- Create a team to go through this process.
- Create a list for the event, make sure your team goes over them all.
- Review, review, review.
- Start the process after finalizing the list. Make sure you always talk to your legal team throughout the whole process.
- Review WARN Act issues.
- Prepare notices. (Learn more about WARN Act notices and how to send them here.)
Plant Closure Checklist: Step Three, Holding the Event
Step three on your plant closure checklist is all about actually downsizing the company. This involves sending notices, holding meetings, and extending benefits.
First, you need to notify the employees that they are being let go that the plant that they work at will be closing in the near future.
You see our sample plant closure notification letter here:
In short, the letter consists of a few simple sections. The first is a few paragraphs that explain that the plant is closing, giving a bit of detail as to why but not too much. Then you move straight into details: when will they be paid, what benefits will they receive, COBRA issues, etc. From there, you let them know that they can reach out with any questions about the process.
This is an extremely simplified retelling of what a plant closure notification letter looks like – so we recommend you check out the example.
When this is drafted, you then need to send it out to the workers who will be impacted. While this seems easy enough, you need to make sure that you send the letter in a way that the staff members will actually receive it.
For example, if the plant workers barely check their email accounts, don’t email it to them. Maybe you should, instead, include the letter with their check or have their manager pass them out. Either way, send this letter in a way that people expect to be contacted so that you can ensure that they are notified.
After the employees have been addressed, the next item on the plant closure checklist is to hold a layoff meeting, which goes into greater detail about what is happening at the company, what employees can expect from the layoff, and all of the other details.
You can learn all about this meeting in our guide here.
Towards the end of this meeting, you will start to get into benefits, which we will talk about in the next section. But first, here’s how this section of the plant closure checklist can look:
- Craft layoff letters
- Send notifications to employees (where they expect them to be found)
- Have office hours for meetings with individuals with questions
- Hold a layoff meeting with each staff member, addressing their concerns
- Include benefits that make the process easier
Plant Closure Checklist: Part Four, The Benefits
This step is all about what happens immediately after the plant closure.
For example, you need to make sure you have a well-rounded, and well-crafted, severance agreement that goes over the layoff in detail and protects you from potential lawsuits.
You should also offer outplacement services to your exiting staff members to make sure that they land on their feet in a new role at another organization. Outplacement also helps protect your organization’s reputation during these trying times.
At the same time, you need to make sure all of these moves follow regulations that protect workers, especially those over 40 years old.
Then, you need to also explain things like COBRA and your layoff recall policy. This section of the plant closure checklist is all about the next steps the employee will take on their journey outside the company.
By providing outplacement support and a strong severance agreement, you can better ensure that your staff members will get through these trying times.
Here’s what this section can look like:
- Create a severance agreement (understand the differences for workers over the age of 40)
- Find and use an outplacement provider
- Go over all benefits in the layoff meeting
- Provide your staff members with next steps
- Explain your layoff recall policy
- Explain other benefits such as COBRA
- Always check with your lawyer to make sure everything is covered
Plant Closure Checklist: The Final Say
While this seems like a ton of things to include on one checklist, remember that the layoff process is stressful for everyone. In these stressful moments, it’s a lot easier to look at a checklist than try to remember everything in the heat of the moment.
In short, the plant closure checklist is a document that can help you understand the full process behind a RIF. If you’d like to download our sample, you can below. As always, different organizations often times require different things. So make sure you adapt our sample to fit your business and plant.
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