Sample Paper on Cost Club Scenario: Confidential Memo

To: Pat, Head of Human Resource Department Manager


Subject: Downsizing the Human Resource Department from Eight to Five Employees by Terminating the Employment of the Three Selected Employees

Usually, many companies are forced to downsize or reduce the number of their employees. The reasons for reducing the number of employees may include issues, such as bankruptcy, especially in cases where the firm is not making enough profit, lack of enough money to pay all the employees adequately, and the reduction in the workload of a company (My Lawchamber, 2014). In such cases, the firms will always be forced to reduce the number of their employees citing reasons beyond their capabilities. Terminating contracts of workers is a job that is usually left for human resource management. From many studies, this normally is not an easy task. This is because the management always has to review the personnel and performance assessment records of each of the employees.

Critically analyzing the important duties attached to each staff member and how every individual in the workforce positively contributes to the company. The human resource management also has to look at other factors, such as productivity towards the staff department, quality of work overtime, effectiveness, and adherence to company policies. After all, is said and done, the management can then decide to choose the employees whose contracts should be eliminated based on various factors relevant to the company. Before any termination is effected, it is important to send a memo in advance letting the employees know that the firm intends to reduce the number of its employees. This move is important as it prepares the staff psychologically so that they are not devastated when the day comes for them to pack and leave. Such notice can be made a month in advance before the termination procedures can occur.

After critically analyzing each personnel and their performance, it is in order to state that the three employees who should go through the sudden termination process are Edith, Greg, and Frank. This decision was arrived at based on the amount and nature of work done by these employees and the type of personal lifestyles that some of them lead. Edith is involved in training and other jobs that are being done by other employees. Therefore letting Edith leave the company will not jeopardize activities, such as training, discharge, discipline, and hiring since there are other employees with expertise in this and have been with the company for many years. The downsizing will as well not affect her financial life since she has a husband who makes enough money to support her and her family. In fact, she does her job for the fun of it.

Employees have religion and religious activities and should never let these activities interfere with their jobs. As such, this is a good ground for terminating Greg’s contract. From his work records, all of his weekend work has to be done by other employees since he will always be away while attending his religious services. He also does other duties that can easily be distributed to other employees. Horatio has not been with the company for quite long and does not offer any productive efforts to the company. In fact, he is a learner who is not very competent in his line of duty. As such, the company will not make any mistakes in letting Horatio leave.

All these employees fall under the law of contract. This is the type of law, that the employer and the employee sign as a form of agreement. The employee agrees to work under conditions set by the employer and cannot dispute them in case of a binding agreement (Sherwyn & Elstreicher, 2004). These agreements include being terminated when the company faces difficulties beyond their explanations. Each of the employees would have to prove that the company has infringed his rights, such as the right to pay annual leave and wages, if there are implications originating from human rights and if they have the rights under the laws to file a complaint against the organization. The employees will be able to win a case of discrimination against the company if any of the acts apply to the termination of each contract and if the employee is able to prove beyond any reasonable doubt that the firm discriminated against them.

The management should ensure that they follow all the legal principles of employment and do not discriminate against any employee based on gender, race, and religion among others. The termination should be honest and feud-free. Cost Club management should be aware of different discrimination claims that the three terminated clients may use, for example, Greg being gay may apply the law protecting employees from the discrimination of trans sexual status, which is ruled contrary to equal law of treatment. This law was amended in 1975 in the p v s and Cornwall county council. Edith on the other hand might recall the previous issue of sex discrimination to incriminate the company (Sherwyn & Elstreicher, 2004). Here, the firm can refer to the case between Marshall vs. Southampton and SW Hampshire Area Health Authority of 1994. Thus, it is important for the company to be acquainted with different case issues, as the terminated employees are likely to strike back. They may also point out the necessary agreement that the employees entered into with the company as they signed their employment contracts.

The firm may also let the employees know that they are planning to downsize and explain in advance that this is not due to discriminatory issues but due to circumstances beyond their control. They should also spell out the relevant company as well as state and federal laws that govern their actions. The organization might also consider employment arbitrations in cases where they are unsure of what to do with the circumstances (DOL, 2014). If the firm finds arbitration and litigation expensive, they might resolve to suitable mediation methods of dispute resolution. There is also a possibility of considering private resolution procedures. This involves solving discrimination issues through private in-house sessions; they may use government agencies to help them solve such disputes.

The table below has been constructed to help in the ease of comparison of the chosen employees


Employee Nature of duty
Edith Handles all training matters for the company.

Coordinates the retraining of employees who are not being laid off.

Discharge, discipline, and hire employees

Greg Not above average in any one job.

Has not been involved in hiring.

His religion prevents him from doing any work on Saturday or Sunday.

Horatio Has limited effectiveness with English language.

He is just learning health and insurance, but is still only marginally skilled.


Department of labour (DOL) (2014). Employment litigation and dispute resolution. Retrieved from

MyLawcha, ber (2014) an introduction to employment laws. Retrieved from

Sherwyn, D. & Elstreicher, S. (2004). Alternative dispute resolution in the employment arena: Proceedings of the New York University 53rd annual conference on labor. Kluwer Law International