A RIF stands for "reduction in force" and is a process where companies reduce the number of employees through layoffs, furloughs, or terminations. It is usually a permanent solution to a perpetual problem, such as huge budget cuts, rigorous reorganizations, mergers, and acquisitions. RIFs are different from layoffs in that they are permanent, while layoffs are temporary. During a RIF, an employee is permanently separated from the organization.

The process of selecting employees for a RIF is difficult and requires objectivity. Managers need to evaluate the value and necessity of each position and assess the value of work performed by every employee to maintain a high level of service with reduced employee numbers. Communication is important for keeping workers engaged, and the remaining employees should be informed of the RIF to limit anxiety.

In the Federal Government, the U.S. Office of Personnel Management develops policy and provides guidance regarding RIFs. When preparing for a RIF, the agency defines the "Competitive Area" that establishes the geographical and organizational limits for RIF competition. The agency applies four retention factors to a competitive level to identify which employee has the lowest retention factor in the "First Round RIF Competition". In the "Second Round RIF Competition," the agency applies the four retention factors again to determine whether a released employee has a bump or retreat right to a position in a different competitive level that is held by an employee with even lower retention standing.