Few HR managers or employers in general see a layoff or round of terminations as a chance to polish the company’s image. They may be missing an opportunity to show the employer’s best side in the worst of times.
The downsides of a layoff are obvious to anyone who’s ever presided over the process:
- a reduction in productivity, at least in the beginning
- bitter ex-employees and low morale among remaining employees
- bad public relations
- shaky loyalty from concerned customers
So, is it really possible to conduct a layoff and end up looking better — or at least as strong as you were pre-layoff? That depends on how the layoff is handled.
If the decision has been made to reduce the workforce, you should create a document that details the reasons for the decision and the goals the company hopes to achieve. The message should be in clear, concise language and in no way appear to be a cover-up or just some official company line.
What’s the point of the document? For one, managers need to understand the reasons for the layoff — besides just “to cut costs” — in order to support it. That’s especially true for first-line supervisors who often get the bulk of questions, phone calls and complaints. The management team must be able to respond consistently with accurate, consistent information — to employees and to customers who get wind of the layoff.
Few people are going to like the decision, but they’ll accept it better and think more of the company if the reasons given are clear, honest and consistent.
Informing laid-off employees of the decision is always one of the toughest parts of the process. Most experts suggest you meet with affected employees individually and inform them of their selection in private meetings. Practice and rehearse what you’re going to say — not so that it sounds staged, but rather so you’re sure you get the words just right.
If individual meetings are impossible due to large numbers, consider conducting meetings by department, shift or unit. That way affected employees are surrounded by familiar faces and not by strangers.
Be brief, consistent and direct. Explain how and why the job was eliminated and specify whether the layoff is permanent or temporary. Outline any recall or rehire rights, available severance benefits, health insurance conversion rights, termination payments and transitional services, if available.
Because employees will be shocked and upset during these meetings, their ability to absorb the information may be limited. Be sure to provide all relevant information in writing and provide the name and contact information of individuals — probably in HR — who will be available to answer questions later.
Carefully select the location and time of the announcement and meetings. If possible, choose a segregated section of the building, preferably an area with a direct exit, so affected employees do not have to pass by their work area or large numbers of people after receiving the bad news. By allowing employees to maintain their dignity and, to the extent possible, their privacy, you can minimize the inevitable negative feelings and leave those employees with the impression that the company still cares about them and their feelings.
Additionally, consider having employee assistance professionals on site on the day of the announcement or available at a specific time and location later in the day or in the days following.
At this time, perhaps more than ever, your remaining employees need attention. You’re going to count on them get the business through the difficult times and help meet the goals hoped to be achieved by the reduction. This is the time for management at all levels to be visible and vocal. Keep employees updated about the financial condition of the company and seek their input for other cost-cutting measures. Look for low-cost ways to recognize hard work and commitment.
There is no way to fully protect a company from lawsuits or hostile reactions following layoffs, but treating the affected and remaining employees with sensitivity and compassion will go a long way to minimizing the risk.
A note about lawsuit risk
Some suggest that to protect against lawsuits, any layoff list should reflect the overall makeup of your workforce. For instance, if your workforce is 40% women, your layoff list should consist of no more than 40% women.
But just about everyone in the real world knows that’s not practical. Most employers sit down and evaluate the list according to needs and employees’ skills and seniority, and then let the chips fall where they may.
What you should do: Take a look at the final list and see if certain groups are overrepresented or underrepresented. If any red flags pop up, that doesn’t necessarily mean you’re going to change the list in some attempt to avoid a bias suit. What it does mean is that you’re getting a signal to double-check all the relevant documentation and reasons for the selection of each employee, in case there ever is a challenge to the selections.