Legitimizing Workforce Reduction: A Review with Special Emphasis on Impact of Covid-19 Outbreak to the Economy
Lecturer, Faculty of Shariah and Law, Universiti Sains Islam Malaysia
COVID-19 outbreak continues to impact business organizations around the world financially. One major concern is the common practice of business organizations to reduce their workforce. Issues might arise from such management decisions. The purpose of this conceptual paper is to analyze the legitimacy of managerial decisions. The methodology of legal analysis was used by referring to and reviewing literature in Malaysia and selected countries. Major findings show that management decisions on the workforce must accord with employment law and existing government plans. Apart from that, an employer's failure to resolve issues of workforce reduction causes animosity and financial hardship for his employees. The findings of this study can assist employers to make management decisions in situations, not within their control.
Keywords: Legitimacy, workforce reduction, management, COVID-19