What HR should do when pink slips to be handed over to employees?


At the time when companies are not doing well or low industrial growth, biggest challenge is to sustain business. Companies start thinking about how to control cost/ expenses. Manpower cost being one of the primary contributors to expense comes in view of the management. After review, management decides to give pink slips to some employees.

We invited Mr Nanjegowda N who is currently associated with www.firstcry.com as Assistant Manager-HR, IR and Administration to discuss on “What HR should do when pink slips to be handed over to employees?”.

Mr Nanjegowda is also one of the moderator of our Statutory Compliance sub forum in www.hrsuccestalk.com/forum.


Question : What if management decides to give pink slip to employees merely because of the manpower cost cutting and organization is facing financial crises?

Ans : Management can decide about handing over pink slips to employees,  if they are convinced about whom to handover based on employees’ performance, discipline, punctuality and attitude.

Employee performance can be viewed in two parts i.e.:

  1. Employees view on his performance.
  2. Secondly, Organizational goal setting for them and productivity or result delivered based on goal.

Employee’s performance is majorly measured on four criteria’s which include:

  • Technical Skills: Technically it is decided, what exactly they have to achieve so that actual organizational productivity should not come down.


  • Functional Skills: At functional level, it shows how he has to work as a leader and work better in comparison of other team.


  • Market Skills: It includes organizational goal, its investment criteria of marketing and what company is exactly looking for, what are the feedbacks and suggestions which company is getting to meet client’s expectation.


  • Behavioural Skills: It shows loyalty towards company in crisis, how to be trustworthy towards company and help them to overcome from the crisis.

Before processing for the Pink Slip it is very necessary to understand the criteria’s and mechanisms of the company. It include competencies of the employee,  how much he achieving against the given target, how much he is competent in functional skills and how he is following the processes and system, how much he is capable as leader and the way he is handling the grievances and motivating the team.

Company also do not want to give pink slips to their employees because company also spend time and money to train their people and also do lots of things for their betterment also, but if the employee is not competent and unable to give expected results company can give them pink slip.


Readers : Your comments are welcome


  1. Mohamad Rafiq December 14, 2015 6:21 am  Reply

    what is written on pink slip. Plz explain for my informations

    • HR SUCCESS TALK December 15, 2015 3:58 am  Reply

      Dear Rafiq,

      Below is wikipedia definition for you:

      Pink slip refers to the American practice, by a personnel department, of including a discharge notice in an employee’s pay envelope to notify the worker of his or her termination of employment or layoff.[1] The “pink slip” has become a metonymy for the termination of employment in general. According to an article in The New York Times, the editors of the Random House Dictionary have dated the term to at least as early as 1910.

  2. Sheela HN December 14, 2015 6:24 am  Reply

    Before Giving Pink slip Company should monitor following aspects
    1,Need to check KPA is acheived?
    2,What is his contributions towards his company in past 2 years/
    3 Whether any training is given to improve his potential?
    4 time line should be given to him for improvement before giving pink slip
    5 Need to check his rate of technical skill which may help company in future
    6.required to check his scale of remuneration in market,because for same remuneration we cannot hire new employee for same position

    Sheela HN

    • HR SUCCESS TALK December 15, 2015 3:59 am  Reply

      Dear Sheela HN,

      Appreciate your inputs on the topic.

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