What to Do When There's a Company Restructuring

A company may restructure for a variety of different reasons, including an economic downturn, high debt, financial losses, or expansion. The process is often stressful and fraught with uncertainty. For you as an employee, the most important aspect of the restructuring process is what it will mean for your career.

Keep reading to explore types of restructuring and ways to navigate the process.

Understanding the Restructuring Process

Corporate restructuring is a company reorganization process that can take anywhere from months to years.¹ You may see downsizing or layoffs, but restructuring isn’t always negative.

To stay flexible as markets change, a company might try one or more of the following restructuring methods:²

• Mergers and acquisitions (M&A): Two companies combine into a new entity, or one company buys another
• Divestment: A company sells, closes, or spins off a part of a business or a subsidiary business
• Financial: A company rearranges its debt or capital structure

Leadership teams plan and prepare the company for reorganization. Their work involves evaluating guidance from financial, legal, and tax experts, so they can understand options and risks and make the best decisions possible.²

The human resources department is tasked with taking care of the workforce. If downsizing is part of the plan, HR must evaluate every position, carry out layoffs, and disperse compensation in keeping with labor laws.

Assessing Your Position

If your company is being restructured, find out exactly what will take place and what your position will be as the organization moves forward.

Evaluate Your Job Security

The first step is to determine if you’re likely to be directly affected by layoffs or role changes. For instance, if entire departments are downsizing, that may mean you’re facing termination. Those with senior or vital positions in the company may have enhanced job security. On the other hand, senior positions come with higher salaries, so terminating these employees may yield larger savings for the company than the release of lower-paid team members would.

Find Internal Open Positions

As the company changes, positions may open up in new departments or locations. These could be management positions or entirely new roles in different areas of the business. If you anticipate that your current role will be negatively impacted, look for openings that suit your skills and apply for them.

In some cases, your company may be required to make a reasonable accommodation, such as for disability, when roles undergo changes. Reasonable accommodations involve adjustments to tasks, duties, or the work environment that help you complete or obtain a job. They’re more related to day-to-day work generally than to corporate reorganization specifically, but can still have important implications.³

Review Severance Package Details

If you are laid off, carefully examine your severance package—that is, the termination benefits offered by your employer. They may include financial compensation, such as a certain number of weeks of pay, and/or help with finding a new job. Severance packages aren’t required by federal or state law, but many companies offer forms of payout. Details specific to your role or company will be reflected in your contract or included in a company policy.⁴

Adapting to Change

Next, make adjustments and establish new connections. Restructuring and role changes often go together, so take this time to train and network, and remember to stay flexible.

Upskill

Learning new skills or furthering your education can enhance your contributions as an employee. Identify your company’s new goals and upgrade your competencies in areas that will support them. For instance, some companies reorganize departments to integrate technology. However, someone still needs to use and configure the technology, which means that your relevant skills and abilities can expand what you offer to your current company, as well as to other employers.

Network With New Teams or Leaders

It’s also essential to build relationships as your organization evolves. If you're staying with your company, reach out to establish connections and collaborate as new leaders and teams come in. New colleagues may feel stressed during times of change, so maintaining a pleasant environment can make an immediate, appreciated impact.

Stay Flexible and Positive

With so much in flux, teams will need to adjust and pivot regularly. The more positive and flexible you are, the easier the transition will be. Positivity and flexibility can help diffuse tension and are valuable to your team.

Protect Your Career

The best work restructuring you may do during these times is within your own career. Consider alternative opportunities and take time to update your resume. Highlight successes from your current position, including real-world outcomes from projects you’ve worked on. Update and optimize your LinkedIn profile with similar information.

Additionally, look for job openings at other companies and consider applying. Network with colleagues in your field and inquire about any openings.

Managing Stress and Uncertainty

Despite changes at work, you still need to show up and perform your best. Take time to protect your health and manage your stress.

Prioritize Mental Health

Restructuring often leads to uncertainty, tension, and confusion. Losing your job, or facing the threat of doing so, can cause deep fear and emotional insecurity. You may worry about your ability to pay your rent or mortgage, or how you'll provide for yourself or your family.

Many people who are still employed after a restructuring experience burnout during the process, whether from high workloads or overall pressure. They may experience confusion or guilt, or feel overwhelmed by new responsibilities.⁵

These are common reactions, and you may benefit from extra support throughout the process, such as therapy or counseling. Seek to maintain a work-life balance and make time regularly to decompress and relax with hobbies and self-care practices you enjoy.

Focus on Fact, Not Gossip

Information and communication are essential during restructuring. However, it’s best to stay informed without getting involved in gossip or rumors. Read company updates and emails and, whenever possible, avoid speculation to help reduce confusion.

Engaging With Leadership and HR

Not all restructuring information may be immediately clear. However, be sure to avoid speculating or making assumptions. Instead, if you are still employed, engage your team leader or HR manager and ask questions. Depending on the situation, it may be best to have private and direct conversations to avoid confusion.

You and/or any of your colleagues may disagree with the restructuring decisions, but it’s wise to avoid voicing criticism that may be demotivating. Instead, offer thoughtful suggestions that could make the process smoother and the experience better for employees.

Finally, if necessary, take advantage of unemployment benefits and retraining programs. Depending on the state in which you live and work, you may have access to payments until you find a new job.⁶ There are multiple eligibility requirements and steps to the process, which you can typically complete online through your state office of employment security.

Strengthen Your Qualifications and Hiring Appeal

Today’s business environment is dynamic and complex, and it takes savvy leaders to guide organizations to success. Company restructuring is sometimes a part of the package. While restructuring can lead to sudden or unexpected career changes, it may also present an opportunity to expand your training and expertise.

Santa Clara University’s Online MBA program is designed to give you the practical skills and real-world knowledge you need to thrive in your business career. Courses in our program are delivered in a flexible online format and taught by established experts with a wealth of experience working in Silicon Valley.

To learn more about our program and how it can help you achieve your career goals, review our admissions requirements, contact us today, or book an appointment with an admissions outreach advisor.