Essay 10 
You have graduated from your BSc degree at LSE and have taken up a position as a management consultant. One of your first assignments is to plan and implement a downsizing programme for a small retail chain that employs 90 workers; 10% of these employees are to be made redundant. How can you use the research on organisational justice to 1) decide whom to lay off, and 2) minimize negative outcomes of the downsizing process?
With the increasing competition in today’s globalized market, lowering costs to maintain profits or to survive in the industry is the focal point of most organisations. Therefore, layoffs have become a common tactic of organisations to reduce labour and operation costs. There is no denying that reducing a workforce could improve efficiency and contains several benefits; however, it also has a number of drawbacks and even brings long-term pernicious effects to organisations. In the following paragraphs, three major points will be discussed, including the selection process to decide who lay off, the possible negative effects, and the strategies to minimize the negative outcomes using theories of organisational justice.
Organisational justice has three major components, the ‘three-factor model’, which includes distributive, procedural and interactional justice, which appears to be correlated with each other (Ambrose and Arnaud, 2005; Ambrose and Schminke, 2007, cited in Cropanzano et al. 2007, p. 3). It has been argued by Cropanzano et al. (2007) that the impression and results of downsizing are so negative that workers perceive distributive injustice directly. However, the interactive effects of the three aspects of justice provide us with a chance to remedy the pernicious effects of certain injustices (Townsend and Wilkinson 2011, p.388; Skarlicki and Folger 1997).
In the context of a small retail chain where 10% of 90 workers are to be made redundant, 9 workers are planned to be laid off. Starting from the selection and appraisal system, the
With the increasing competition in today’s globalized market, lowering costs to maintain profits or to survive in the industry is the focal point of most organisations. Therefore, layoffs have become a common tactic of organisations to reduce labour and operation costs. There is no denying that reducing a workforce could improve efficiency and contains several benefits; however, it also has a number of drawbacks and even brings long-term pernicious effects to organisations. In the following paragraphs, three major points will be discussed, including the selection process to decide who lay off, the possible negative effects, and the strategies to minimize the negative outcomes using theories of organisational justice.
Organisational justice has three major components, the ‘three-factor model’, which includes distributive, procedural and interactional justice, which appears to be correlated with each other (Ambrose and Arnaud, 2005; Ambrose and Schminke, 2007, cited in Cropanzano et al. 2007, p. 3). It has been argued by Cropanzano et al. (2007) that the impression and results of downsizing are so negative that workers perceive distributive injustice directly. However, the interactive effects of the three aspects of justice provide us with a chance to remedy the pernicious effects of certain injustices (Townsend and Wilkinson 2011, p.388; Skarlicki and Folger 1997).
In the context of a small retail chain where 10% of 90 workers are to be made redundant, 9 workers are planned to be laid off. Starting from the selection and appraisal system, the
References: Colon, D.E et al. 2005. How does organizational justice affect performance, withdrawal, and counterproductive behaviour? In: Greenberg, J. and Colquitt, J. eds. Handbook of organizational justice. London, Mahwah, N.J.: Lawrence Erlbaum Associates, pp. 301-327. Coyle-Shapiro, J. and Dhensa, R.K. 2011. Justice in the twenty-first-century organization. In: Townsend, K. and Wilkinson, A. eds. Research handbook on the future of work and employment relations. Cheltenham: Edward Elgar, pp. 385-404. Cropanzano, R. et al. 2007. The Management of Organizational Justice. Academy of Management Perspectives 21(4), pp. 34-48. Greenberg, J. 1990. Employee theft as a reaction to underpayment inequity: The hidden cost of pay cuts. Journal of Applied Psychology. 75(5), pp. 561-568. Skarlicki, D.P. and Folger, R. 1997. Retaliation in the workplace: The roles of distributive, procedural and interactional justice. Journal of Applied Psychology. 82(3), pp. 434-443.