Rethinking layoffs with public funding

To curb growing jobless rates within member states, the European Union released proposals May 7 that included shorter working hours for employees to avoid layoffs. The Czech Republic is one step ahead after allocating 3.3 billion Kč from the European Social Fund in March for a program that bankrolls training programs for employees who have been put on reduced working schedules. Companies that qualify send employees to programs for one or two days a week, with the state paying those days' wages and the cost of the courses, which includes "soft skill" education or even retraining. According to the Labor and Social Affairs Ministry, the program is expected to maintain 70,000 jobs.

ImageLab, a Czech consulting and training company, has been helping companies create programs in order to apply for the funding as well as run the training courses themselves. The company recently concluded a three-year project to help the long-term unemployed, which was also funded by the EU and implemented through the Labor and Social Affairs Ministry. Vratislav Kalenda, co-founder, and Ondřej Rak, an account manager-consultant, spoke to The Prague Post about why it's important to maintain staff during a recession.

The Prague Post: Maintaining staff levels is often unrealistic when company budgets have to be slashed. Why do you believe employees are one of the more important assets a company can hold onto?

Ondřej Rak: This crisis is a little different than past ones - and the EU funds reflect that. Companies have learned it's not a good idea to fire people, because, among your staff, you have a wealth of potential. Once the crisis is over, these will be the people responsible for the success of the company. So, even in times of crisis, it's worth spending even a company's own money on education and coaching.

Vratislav Kalenda: The program can help align company strategy with the abilities of existing employees, giving that company a competitive advantage. It can also help companies identify their talented people with high potential and help them to go further or reassign them to [other] areas of the company.

TPP: How do you help a company decide what sort of training or coaching their employees will most benefit from?

OR: A consultant, in this case, is an ideal partner for companies to prepare these programs. There are thousands of options to choose from, but a consultant can say, "Well, these are really similar; you don't need this." Companies often have fantasies about what they can achieve. For example, you hear "team building," and what comes to mind? A majority would say outdoor activities. But team building can be done indoors without demanding any physical activity.

VK: You have to ask the client, "What you do you expect to change after this team building? What is the reason for doing team building?" You can provide team-building exercises if that's what the company really wants, but we have to add value and need to deliver results. You do not want to over-promise and under-deliver; the opposite of that is better. So you have to clarify the expectations of clients and promise them real, measurable change.

TPP: Do you have high hopes for the ministry's and the EU's program, and do you see any drawbacks?

VK: Getting European money for companies is a really tough process. It's not that easy to write the program application. It takes a lot of time, and it takes some experience. That's one part we can help with. I have to say, with the local program, there's a much faster reaction, but the process of getting European money takes a long time. You have to prepare the proposal and wait for the approval. That can take six months. A lot of companies can't wait half a year to start.

OR: In that case, some companies are using their reserves to start programs now, and don't want to use EU funds because the paperwork required is so demanding. You really need two or three people to manage the application process.

VK: Once you write down the project proposal, you don't have any flexibility for improvement or changes, and that's a problem because, in these times, you need that flexibility to react to changing needs.

TPP: Is continuing education and onsite training something employees will come to expect from employers in the same way they expect other benefits, such as health insurance?

OR: Yes, especially now. Companies don't want to lose people, but they can't afford to simply give them extra money, so they're looking for things that are interesting for employees.

VK: People expect the opportunity to grow and learn something on the job. These programs let companies make their employees feel like management cares about them and wants to develop their talents.

Claire Compton can be reached at
ccompton@praguepost.com