What is your best way to start downsizing process without any legal conflicts, especially if the only solution is to reduce your manpower size?

To just start from calling a management meeting,and try let all department understand what the organization is going through.Then reduction in expenses,reducing in top management officer salary,closing down of some department that is not contributing to the growth of the organization.Making sure all  hands are on desk for the tasks ahead of the organization.

Without reducing Manpower size, Ask the employee to work with low salary from top level to down level. Till the market get control and after the market rises and company start getting the profit. Let the company cover the loss and expenditure. After that company has to pay the employee with previous salary they have compromise for the company and provide them bonus of the profit. Which will help company to maintain the same employee with his same strength to process further and also this will highlight the company for longer run in business as well as in front of customer.