Unemployment prevention: The role of Human Resource Management in job-to-job transitions in the event of redundancy
| Author | Irmgard Borghouts – van de Pas,Charissa Freese,Mark Bosmans |
| Published date | 01 June 2021 |
| Date | 01 June 2021 |
| DOI | 10.1177/1388262721995209 |
| Subject Matter | Articles |
Article
Unemployment prevention:
The role of Human Resource
Management in job-to-job
transitions in the event
of redundancy
Irmgard Borghouts – van de Pas
Department of Private, Business and Labour Law, Tilburg University, The Netherlands
Mark Bosmans
Nivel, Netherlands Institute for Health Service Research, Utrecht, The Netherlands
Charissa Freese
Department of Human Resource Studies, Tilburg University, The Netherlands
Abstract
In downsizing organisations, redundant workers suffer from insecurities about work and income.
Social security provides income security to the unemployed in the event of job loss. The role
played by employers in unemployment prevention for redundant workers, and the effects on
unemployment spells and transitions on the labour market, are neglected in both the social
policy and HRM literatures. This article addresses the following question: Which factors play a
role in the decision to offer job-to-job support and in determining its effect? This article provides
the context for the theoretical assumptions regarding why employers initiate job-to-job measures
for redundant employees and distinguishes the different types of measures based on a literature
review. Secondly, this article contributes to empirical knowledge in the field of unemployment
prevention among employers and the effects of job-to-job activities facilitated by employers on
redundant workers’ unemployment spells. A two-wave study was conducted on a sample of 2,258
Dutch redundant workers. The study shows that age, breadwinner status and gender are important
predictors of unemployment duration afterinvoluntary dismissal. The findings show that investing in
the human capital ofredundant workers by providing training and education and individual coaching,
for example, are associated with a reduced unemployment spell. In our model, in which we con-
trolled for other variables, we found that when one received training, education or individual
Corresponding author:
Prof. Dr. Irmgard Borghouts - van de Pas, Department of Private, Business and Labour Law, Tilburg Law School and
Department Human Resource Studies, School of Social and Behavioral Sciences, Tilburg University, The Netherlands.
E-mail: i.borghoutsvdpas@tilburguniversity.edu
European Journal of Social Security
2021, Vol. 23(2) 103–119
ªThe Author(s) 2021
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DOI: 10.1177/1388262721995209
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coaching shortly before or after the dismissal, one was unemployed for an average of almost three
months less.
Keywords
Unemployment prevention, active labour market policies, human resource management,
redundancy, dismissal, downsizing, employment security, social security
Introduction
Companies restructure their organisations in response to crises, globalisation, increased competi-
tion, and new technologies, often resulting in downsizing. Market pressure to increase the profit
margin is an additional reason for company restructuring. In these times, redundant workers face
tension and uncertainty regarding work and income (Shoss, 2017). The global financial crisis
resulted in organisational retrenchment strategies focused on downsizing and restructuring and
caused mass unemployment in many countries. Now, after the crisis, the relevance of unemploy-
ment prevention has taken on a new dimension. The coronavirus has had a major impact on the
labour market over the past year. Some sectors have been hit hard and jobs are at risk, making the
results of this study even more relevant given the expected major impact on the global economy. It
is not only cyclical developments that cause jobs to change or disappear, but increased global
competition and technological innovation, too (e.g., Frey and Osborne, 2017). It is important that
redundant employees make a smooth transition to new jobs to avoid long-term unemployment,
which stresses the significance of unemployment prevention, training, and education.
It is beneficial for employees, organisations, and society when redundant workers make the
transition from the current job to a job with another employer in the event of involuntary dismissals
rather than becoming unemployed. The new job not only provides income and work security, but
also decreases the emotional stress of employees at risk (Jahoda, 1997; McKee-Ryan et al., 2005).
The benefit for society is that redundant employees rely less on unemployment benefits or avoid
using them altogether when the period between two jobs is as short as possible. Other advantages
are lower risk of long-term unemployment and additional negative effects, such as the poor health
issues that are associated with unemployment. For organisations, the benefit of smooth job-to-job
transitions is financial as the labour costs decrease when redundant employees are no longer on the
payroll, i.e., when the transition starts before the notice period ends. Another benefit is a positive
effect on the employer’s reputation. Reducing skills depreciation is an additional benefit for
employers and workers.
Combatting long-term unemployment is a major public objective in the European Union and its
member states. Over the past decades, active labour market policies (ALMPs), which promote the
employability and labour market participation of unemployed people, have been on the agendas of
governments in European countries (Bonoli, 2013). However, these ALMPs apply to people who
are already unemployed and do not focus on workers who might lose their job in the near future. In
response to the economic crisis in 2008, governments introduced measures to cushion the impact
on the labour market and support workers who lost their jobs (Heys, 2013). The European Com-
mission encouraged Member States to ensure that the measures were in line with the ‘flexicurity’
concept, i.e., a shift from ‘job security’ towards ‘employment security’ by exchanging more
flexible dismissal regulations for greater investments in ALMPs, modern social security systems
104 European Journal of Social Security 23(2)
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