8 Tips for Handling Layoffs
Layoffs, according to Wayne F. Cascio, a professor at University of Colorado Denver who has studied layoffs for decades, “have been pretty constant over the years, and it seems to happen no matter what the economy is doing. When the economy is down, it’s always the argument that we’ve got to cut costs, and when it’s doing well we often hear we need to improve profitability, because it’s the best time to do it. The tune hasn’t changed.”
While media headlines and news only report the layoffs happening across big companies, small and medium sized businesses are not immune. While layoffs may be viewed by larger companies as just another business decision, the owners and executives of small and medium businesses (SMBs) make these difficult decisions only after all other remedies have failed, and with a large degree of guilt and sadness. When a company employs less than 1,000 the decision weighs exceptionally heavy on owners and managers that have come to see employees as family.
Before now, the option of engaging with established outplacement providers didn’t exist. Recognizing that companies, regardless of size, understand the financial and brand impacts of a layoff, SMBs now have a quick and easy mechanism to offer career transition support to one person or multiple people. This allows the company to demonstrate that they care for their employees and their community while meeting their financial goals and helping to minimize long-term tax liability through helping people get back to work quickly.
Because “doing the right thing” by employees is often top of mind for small and medium business owners and managers, we’ve compiled a list of 8 ways to take care of your employees following a layoff.
#1: Build a business case
By the time you are ready to layoff employees, chances are, you’ve done everything else to reduce spending and cut costs across the business. This is why it’s so critical to communicate during every phase of the process, and create a concise business case for the purpose of the downsizing event. This business case will inform sequential communications, like notifications, general internal and external announcements, and notices to employees. By explaining, with a concise business case, why a layoff was necessary, employees are less likely to criticize your actions.
#2: Host manager notification training
It’s critical that managers and business leaders understand their role during a layoff. RiseSmart offers Manager Notification Training (MNT) to help HR and functional leaders understand their role and that messaging is consistent throughout the organization. Even if you’re only going to lay off a few employees, manager notification training can help those who will be delivering the message understand the importance of following best practices and legal guidelines, it also helps your management team prepare emotionally for the event. Managers, Human Resource business Partners (HRBPs), and benefits providers have distinct roles during a layoff. A successful transition requires all groups to be supporting employees in unison. Getting everyone together in a meeting before the event will create the synergy you’re seeking.
#3: Plan and prepare emotionally
It’s normal to feel a wide range of emotions when facing a layoff. Sadness, guilt, fear, anxiety, confusion, cynicism, embarrassment, and resentment are all on the spectrum of normal. As we tell managers during MNT, it’s normal and expected that you would have an emotional reaction to the event. Acknowledge these feelings and try talking it out with other managers or HR professionals in the organization. The more you can do to process and feel your own emotions prior to the event, the more empathetic you can act toward impacted and retained employees.
#4: Assemble a layoff team
Gather internal folks, including leaders from HR, finance, legal, and other key players, as well as the heads of departments impacted by the layoff to be on your layoff “team.” This team should then be driven by an HR project manager or other key executive team member.
Externally, it’s smart to connect with legal counsel and employment attorneys who are experts in handling workforce reductions. The size and scope of your external team should depend on the percentage and types of population affected by the layoff.
#5: Hold a planning meeting
Meet with each leader or manager responsible for making decisions about who will be retained, and who will be impacted by the event. It’s important to discuss, either as a group or one-on-one, all of the legal, ethnical, and organizational ramifications of a layoff decision. It’s helpful at this point to have a step by step plan of established best practices and assign responsibilities to team members.
#6: Communicate consistently and quickly
Try to deliver all layoff notifications within a short period of time to alleviate the concerns of employees who will be retained. When you spread it out across multiple days or weeks, employees are left wondering if they are next. This in turn creates feelings of anxiousness and emotional turmoil for the employees left behind.
We recommend that mangers schedule a group meeting with remaining employees in the department once the layoffs have been communicated. Plan to meet one on one with each remaining employee as quickly as possible after the layoff. This sends an immediate signal to the employees that you respect and value them as individuals, which will not only help you preserve your reputation as an employer and a company, but it will also help the organization return to its new state of normal as quickly as possible.
#7: No apologies, only appreciation
As you communicate the news of a layoff with impacted employees, it’s vital to demonstrate care and kindness. Instead of apologizing, express appreciation for what your employees have contributed to the team during their tenure. Revisit the business case for the layoff, and calmly and non-defensively reiterate the decision and rationale for the separation. And, above all, even if it feels like you have a million things to take care of, truly listen to employees.
#8: Partner with an outplacement provider
Sure, it’s possible to handle a layoff without an outplacement provider by your side, but it’s not always easy. When considering a vendor, be sure to choose one that has programs and packages designed specifically for small or midsized companies. The last thing you want is to reach out to an outplacement provider only to be told that you’ll have to sign an expensive long-term contract and sign up for services you’ll never use.
Due to the rising demand from small and midsized businesses, RiseSmart offers an “Express” version of its outplacement and career transition services technology. RiseSmart Express is designed with SMBs in mind. Businesses can purchase outplacement resources a la carte, depending on the position of the transitioning employee, as well as manager notification training and other services. Visit www.risesmartexpress.com for more information.