# What is Demotion in HR?

Demotion is when an employee is moved to a lower role, often due to restructuring or performance. SMEs must handle it fairly to reduce legal risk and morale issues.

Source: https://faqtic.co/glossary/demotion

## Why it Matters for SMEs

- Reduces disputes
- Ensures fairness
- Manages restructuring

## Example in Practice

Factorial records role changes and reasons for transparency.

## Frequently Asked Questions

### Is demotion legal?

Yes, with proper process.

### How to reduce impact?

Communicate clearly and support the employee.

### Should it be documented?

Yes, always.

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