Management strategies for layoffs
By Joan Lloyd
Dear Joan:
I've been through two downsizings. In the first one, my boss
knew six months in advance that one fifth of the staff would have
to go. He told us all about it on day one. He then told us
that he would rather we left for new jobs rather than him having to
make a difficult choice about who to keep, since we all had
essentially the same skills and seniority.
He let us have time off - with pay - to go to job interviews,
phone and online access to job hunt, provided references for us
(including talking to prospective employers both in person and on
the phone for us), and helped us hunt for new work using his own
contacts in the field.
We all helped each other job search and the staff numbers were
what he needed after two months. Not only that, but those of us
left behind felt no grief since we knew that those leaving were
going on a good footing with no hard feelings. We knew that our
boss and the company cared enough to be proactive in helping us,
not reactive.
In the second downsizing, my boss hid her head in the sand and
wanted to wait until the last minute to make the staff cuts. I
found out about it well in advance through other contacts, but kept
my mouth shut while I waited for her to let us know. I also found
out that my position was being cut in the first wave, which was to
be about three months later.
Since mine was an HR position and this was the first time
she'd been in this situation, I finally took her aside and we
discussed how we could make the cuts happen without too much
collateral damage. Using the experience from the first time I'd
been through this, we were able to make it a lot easier on staff.
Not perfect, but a lot better. She put me in charge of that side of
things, including letting staff know about the whole process,
and that even gave me a few more weeks on the job before my
position ended. Since then, that business has improved and
has needed to hire people from the small community where it's
located. They have a good reputation in the community and that
helps.
Job cuts suck for everyone. And eventually more people will
need to be hired when the business expands. Talented and trained
people who are familiar with the company are much easier to
on-board than new people, especially if they have a good opinion of
the company.
Answer:
With the lay offs hitting many industries, this letter is
particularly relevant. What an excellent example of what happens
when you treat employees like partners.
Transparency pays off in many ways. A company’s
reputation—especially in a small community—is a
valuable asset. People talk and when they feel wronged they
really talk.
Usually a company will plan a layoff in secret. Senior
management worries that sharing too much information too soon will
cause panic, defections and poor morale. And they’re right.
But, unfortunately, not sharing information can have the same
result because the grapevine will pick up the news and telegraph it
anyway…causing even greater dips in morale and lost
productivity.
The tricky part is when to share the details of the layoff
and how much to share. The important part is how well the employees
will be treated as they exit.
Things to keep in mind regarding layoffs:
- Leading up to the layoff, disclose the reality the business faces. Acting like everything is fine and then suddenly announcing layoffs is going to create more anger and resentment. The news will be accepted more easily if they have been treated like adults who deserve to know the truth.
- As a general rule letting staff know as soon as possible feels more respectful than keeping them guessing and telling them at the last minute. The sooner they can get busy making plans for their future the better.
- When the announcement is made, include enough details on key concerns such as severance, health care coverage, vacation pay, and job hunting help. If you don’t, demand for answers will bring productivity to a standstill.
- Advise managers to proactively communicate with all employees through one-on-one meetings, group Q&A sessions and attendance at company-wide meetings. Managers may want to hide from employees so mandate the opposite.
- Have a how-to session for managers. Give them language to use when talking to and about departing employees. Give them guidance on how to be proactive about helping employees find new jobs, such as making direct referrals to other contacts, being a reference and giving recommendations.
- Be sensitive to the “survivor factor.” Guilt and depression is common among employees who made the cut. Advise managers to have teambuilding meetings during which departed employees are acknowledged and new goals are set. A bit of “mourning” the old can create closure, clearing the way to reenergizing the group for the task ahead.
