Outplacement, Newplacement and Executive Placement - Working-in-Germany
 
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Outplacement, Newplacement and Executive Placement


Definition, Explanation

What is called outplacement is dismissing an employee – mostly applying to expert or executive employees – and subsequently placing that person in a new position / new job (replacement). Related services of advice and placement support are rendered by outplacement advisors. The former employer usually takes over the financing, sometimes using a share of the severance payment, easing the dismissal process for both parties and to avoid differences. In the beginning, these services were mainly provided for expert and executive employees, while today even all employees of a department at once are supported in this way.

Outplacement advisory support should be taken starting before the end of the employment, and usually ends with the employee’s successful passing of the probation period in the new job. The purpose of outplacement services is avoiding unemployment and getting the employee placed into another company soon, respectively supporting the employee starting a business.

Reasons for outplacement advisory service:

  • Dismissal for reasons of economization or reorganization
  • Insolvency
  • It is part of a social plan
  • Cancelling or outplacing of certain tasks and involved employees

The outplacement advisory service comprises:

  • Preparation of the dismissal (separation talks, cancellation agreements)
  • Psychological counselling and support after the dismissal
  • Evaluation of the employee’s potential
  • Practice of self-portrayal
  • Further education and re-education programmes
  • Career coaching
  • Finding of a suitable new position, from the job hunter’s perspective, includes aspects as work life balance and tax and assets matters. To be distinguished from the work of head hunters who are ordered and paid by a company to find suitable personnel to fill internal positions
  • Résumé: Reasons for the separation, strengths, weaknesses, experiences, successes, desires, ideas
  • Assessment: personality tests
  • Compiling of personal career goals
  • Feasibility analysis of employee’s desires and ideas
  • Check on matching of employee and potential future companies and their company culture
  • Providing of information on companies
  • Support in contacting potential employers
  • Advice for applications and job interviews
  • Retrospection on job interviews and feedback
  • Support in business start-up

Advantages for the dismissing company:

  • Avoiding of image detriment, for public image as well as internally to employees
  • Avoiding of “acts of revenge” by dismissed employees
  • Shortening of remaining period of employment contracts
  • Saving of court expenses, avoiding legal dispute
  • Avoiding of dismissals for operational reasons which would oblige to select to-dismiss employees according to social criteria and other sanctions of dismissal protection law. Instead, one can conclude cancellation agreements
  • Avoiding of losses of motivation and thereby of productivity

Advantages for the dismissed:

  • Professional advice and support in the “job finding process”
  • Quick placement
  • Prevention or shortening of unemployment

Costs of outplacement advice service:

  • Normally 20 per cent of the old annual income, for expert and executive personnel and in open-end outplacement programmes
  • The costs of fixed-term outplacement advice service are about 2,500 to 5,000 Euros per employee
  • For regular employees, the government pays 2,500 Euros on the basis of § 216a SGB III, if the employer contributes the same amount. This suffices for outplacement advice service lasting for 4 to 6 months

The outplacement measurement can be performed with single persons or with groups. Sometimes, outplacement advice service is limited to a duration of 3 months, in other cases it is open-end, ending with the successful placement of the former employee in a new job.

Single-outplacement is mainly provided for executive personnel. Depending on regulations, the company or the to-dismiss picks the advisor. The advice service deals particularly with the individual situation of the employee. For the refund of costs, there are several possibilities: The company directly pays the outplacement advisor, or provides a budget for it to the employee, or the employee pays it on his or her own.

Group placements, in contrast, are provided mostly when complete departments or just groups of employees are to be cared for. The employees then mostly are in medium or lower level in the company. In seminars and workshops, knowledge on applying, job interviews, and the like, is conveyed. In complement, there is provided individual advice considering the individual situation and the resulting possibilities.

Tips, Checklist

  • Accept an offer of outplacement advisory service by your company. A dismissal will not be averted by rejecting that. Also, by rejecting, you risk to be denied entitlement to instant unemployment benefit
  • Outplacement advisory service is help in self-placement. The advisor is not meant to do the whole jobseeking for you, but to support you in your whole process of application and preparation
  • Outplacement advice is a matter of trust. When you are as lucky to have a personal advisor, do get acquainted with him, first
  • The first information talk should be free of charge
  • Have your coach tell you about his occupational background. Does he know your branch and the companies in question? Is he experienced with executive positions or in personnel management? Does he work regionally or even internationally
  • Check if the outplacement advisory service will include a guarantee. In some cases, the advisor will feel responsible for you for up to 12 months. If the new employment is cancelled within that period, he will place you anew, for free
  • Unfortunately, on this market, there are a number of unserious companies. So get a picture of the degree of professionalism and the particular services, before you conclude a contract
  • Look for outplacement advice, early. Your chances to find a job will be higher if you apply while you are still employed
  • Many companies, today, offer to provide outplacement advisory service in case of dismissal. If that should not be the case, talk about the matter with your employer / your boss and negotiate on it within a cancellation agreement negotiation, particularly regarding the payment of costs
  • Consider the possibility to pay outplacement advice on your own. If you do, your severance payment you are entitled to increases. The advisor will be obligatorily committed to you. Also, you will be provided career coaching and support in finding a job



Last update: 03/02/2010
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