Case Study

(Chapter 7)

Employee Layoffs at the University Medical Center

The University Medical Center is a medium-sized, 300-bed capacity

hospital in Dasmariñas City. The facilities have grown gradually over the years
and considered one of the largest in the city. Although it is unionized, it has never
experienced an employee layoff since its inception.
Sister Lallaine Buenaobra, the Chief Executive Officer of the hospital for
eight years, presented a rather bleak financial picture during the most recent
quarterly meeting of the board of directors or BOD. This, according to her, is the
result of the declining occupancy rate brought about by the opening of the
biggest government hospital in the province. This has affected the income of the
hospital posting a net loss in its latest income statement. Such declines have not
been unusual for this industry because of increasing competition. So far, the only
response to these changes has been a tightening of requirements for equipment
and supply purchases. The projected deficit for the coming year is around
P1,300,000.00 unless some additional revenues are identified or some additional
savings found. The BOD’s recommendation is employee layoffs, which according
to the board is the only realistic alternative. They recommend laying off up to 25%
of the hospital’s employees.
Melinda Dumael, the HR director of the hospital was given the task to
implement the recommendation of the board.

Help Melinda and Sister Lallaine solve this problem by following the steps:
1. State the main problem of the hospital.
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2. State the different areas of consideration following the guide
below. Strengths of the Hospital:
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Weaknesses of the Hospital:
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Opportunities:
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