You are faced with downsizing payroll costs by 12%. Currently GCC has 648 employees, all non-union. The event that has triggered the need to downsize is the recent tariffs placed on the plastics industry resulting in a major drop in demand for GCC’s custom plastics molding products. We understand the prospects for new customers and reduced tariffs will take at least 18 months to develop the customer pipeline and receive actual new sales orders.

GCC has no choice but to now get ‘leaner’ to be in a strong position for this marketplace change. GCC faced a serious business downturn in 2020 resulting in a workforce reduction of 10% at that time. In addition to this business challenge this year, there is speculation that a union drive is being talked about with some of the machine operators at GCC.

The current annual payroll for GCC is $30.8 million, so the 12% payroll cost reduction is approximately $3.7 million.

Your summary analysis of the selected key jobs being considered for downsizing is:

Job title	# of ees	Job Rate	Annual Payroll	Average age
Senior Management	6	$150,000	$900,000	52
Sales Reps.	8	$60,000	$480,000	42
Engineers	8	$75,000	$600,000	38
Technicians	15	$55,000	$825,000	35
Machine Operators	33	$35,000	$1,155,000	29
General Workers	20	$30,000	$600,000	28

Your management team is looking for your recommendation on how to best downsize. The team understands you have just completed an HR planning course, part of your extensive knowledge in managing people through many different business cycles.

Answer the 3 points below:

4.1 The range of criteria that could be used and what should be used to downsize.

4.2 The first three steps needed to be taken to make the downsizing happen and why.

4.3 Two key messages to consider when communicating to both the victims and the survivors.