In tough economic times, every corporation has to address the time when the company needs to cut back. This sometimes means not only cutting bonuses and other expenses, but can also mean whittling down your team of workers. These decisions are always difficult to make. Instead of simply laying off a worker, you may want to consider giving one or all of the following suggestions to the employees you are considering letting go.

Cut Hours. Instead of flat-out firing a worker, ask them if they would consider going to work part time instead. In some cases, you may not even need to cut down hours from full time to part time, but can reduce hours from forty to thirty hours a week, or can ask workers to no longer take any overtime work. Over time work can be one of the biggest expenses for a company, so limiting these hours may be important.

Early Retirement. Instead of cutting younger workers, consider going to your older employees who are only a few years away from retirement. Offer them an early retirement package, where they will receive the benefits of their retirement now instead of later. Since you were already going to pay them their retirement, you can save yourself the years of salary you were going to give them. Note that simply terminating an employee and not giving them the retirement you promised should not be practiced, as this can give your company a bad reputation, and will greatly decrease your employee morale (which will already be low due to budget cuts).

Fewer Benefits. You can also offer a worker the option of fewer benefits in order to stay on full time. You can do this through allowing them to find their own insurance, not renewing their company car, or other methods. You can always provide stipend that will go towards these expenses, but will be a smaller cost for you. While you are still lowering their pay by taking away these benefits, your employee may still prefer this to no longer working, or going to part-time work.