Reassigned Employees on the Rise | October 2023

October 9, 2023

Linda Ferrell

It’s common to hear about promotions and separations. Now, reassignments are becoming increasingly common as an alternative to laying off employees.

Inside reassignments

A transfer (or reassignment) is a move to another job within the company, typically at the same level and wage. Transfers allow workers to obtain new skills or to find a new position within an organization when their old position has been eliminated because of automation, artificial intelligence, or downsizing.

Reassignments on the rise

Instead of laying off employees, organizations can transfer employees internally to cut jobs instead. Many companies, including Adidas and Adobe, have issued reassignments due to organizational restructuring. According to one estimate, mentions of “reassignment” and similar words and phrases on company earnings calls tripled between August 2022 and August 2023. The Wall Street Journal has dubbed this phenomenon “quiet cutting.”

Good or bad?

Some see reassignments as a good sign. Reassigning an employee is a way to retain high-quality talent, fill new positions that fit a company’s current plans, and vacate old positions that no longer serve the company. Reassigning can benefit companies during a labor shortage when finding qualified talent is more challenging. Plus, it’s typically more expensive and time-consuming to hire a new employee than it is to retain existing employees. Some argue a reassignment is more appealing than being fired and see it as a genuine offering from a company to avoid letting people go.

On the other hand, reassignments can negatively affect employees, causing stress, job security concerns, and low morale. Employees can find themselves filling undesirable positions that require different skills or offer lower pay. A reassignment can also be a sort of limbo, allowing a company to hold onto an employee that would be too expensive to fire due to severance and unemployment benefits. A company could reassign an employee with the hopes that the employee would leave on their own or reassign an employee to a position that would require relocation, knowing the employee in question is unlikely to move.

When planning and developing strategies for reaching the organization’s overall objectives, a company must consider whether it will have the human resources necessary to carry out its plans. Over-relying on reassignment or poorly executing internal transfers may not be worth the potential cost savings if morale plummets. It’s important for managers to effectively plan for human resource needs.

In the Classroom

This article can be used to discuss planning for human resource needs and trends in the management of the workforce (Chapter 10: Managing Human Resources).

Discussion Questions