Ease the stress of laying off employees with these tips from members
Published on March 5, 2002
It wasn't losing her job that left a bitter taste in Barbara Opyt's mouth. It was the way the layoff was handled, said the former training manager for an Austin, TX-based software startup.
At an early morning, all-company meeting last October, Opyt and her colleagues listened to a standard, if not insincere, staff reduction speech. Staffers were then told to return to their desks for individual meetings with supervisors. While others met with their bosses to discover their fate, Opyt sat nervously at her desk while her supervisor, a VP, remained squirreled away in his office most of the morning. Near afternoon, he suddenly appeared at her desk and spit out a chilly "Okay, let's go over to the HR office." As Opyt recalled, a bit more compassion from her supervisor would have made the layoff much less painful.
There's no doubt that the layoff experience is an awkward, and often painful, experience for everyone— including supervisors. The situation obviously is much more difficult, and more stressful, when an IT leader's leadership and management skills aren't finely honed when it comes to conducting layoffs. That lack of experience often creates the worst-case scenario for both the employee and supervisor.
As Opyt pointed out, the emotional turmoil can be eased quite a bit if a layoff is handled in a professional manner. To get further insights on how best to approach staff layoffs, we queried TechRepublic members about their experiences and what CIOs and VPs should and shouldn't do when it comes to staff reduction. Here are the top five tips members shared on making a painful business decision less stressful for all.
Tip 1: Consider a voluntary layoff strategy
Before the CEO and CFO issue the first alerts about possible staff layoffs, CIOs and VPs should investigate the possibility of offering voluntary layoff packages as part of the initiative, said TechRepublic members. This can be especially valuable when there's a large near-retirement base of employees. Sometimes, there are employees secretly looking to move on to retirement early or to move into another field but who don't want to negatively impact their retirement package so close to the retirement date. For managers, each voluntary retirement means one less staff layoff required.
Tip 2: Don't play games
Denver-based network engineer Jason Holmes chose a job with an IT consultancy's new Colorado branch office over a similar offer from a larger player in the local market.
It turned out to be a bad decision.
During the job interview, Holmes was reassured that the consultancy would succeed in Denver. Yet the assurances were false. Holmes was laid off one month into the job, and the new branch closed a month later. It turned out that the office location was iffy from the start and tied to potential new business that failed to materialize.
Obviously, if he had been told the truth, said Holmes, he would have taken the other job offer he was considering at the time.
One IT project manager had a similar experience this year. Pay raises had been postponed for 10 months at the national human resources outsourcing firm the manager worked for in Minneapolis. The raises finally came through, but just two months later, the company laid off over 200 employees.
In hindsight, it was clear that the company was having troubles, said the project manager, who now lives in Atlanta. He believed the company should have warned employees that layoffs were on the horizon so employees could get a jump on finding new jobs, as the job market was much stronger a year ago.
The moral here, said TechRepublic members, is that companies that lie, or don't inform candidates and employees of impending danger, do a disservice to both the company and the employee. While no one is eager to hear bad news, it's only appropriate that the employees be provided the opportunity to look for new jobs before the pink slip arrives, they said. In Holmes' situation, the company's actions not only reflected poorly on the company's hiring practices and tech leadership, but it also temporarily stalled a professional's career.
Tip 3: Sincerity and compassion can go a long way
Jason Goray, a Minneapolis-based Web developer, said he knew something was up when coworkers were called into the CEO's office, one by one, in early 2000. Since the small Web design shop outsourced its HR functions, the layoff ax was in the hands of the CEO, who actually cried when she told Goray he was being laid off. It was this show of emotion and sincere regret that impressed Goray, who said, "I am positive that there is no way some former HR people I have worked with could have imparted such a genuine sense of caring and compassion."
It's only common sense to feel sorrow and sadness at the loss of an employee who's only being terminated for budget reasons, said TechRepublic members. Mutual respect and shared empathy can go a long way to making the layoff experience much easier.
Tip 4: Keep the rumor mill quiet
While it's easier said than done, quashing the rumor mill can help alleviate unnecessary stress and anxiety among employees when there's talk of impending layoffs. Yet rumors will inevitably circulate, and IT leaders owe it to their employees to check the rumors out and get back to employees with answers, said HR consultant and author Ken Gaffey, president of Kenneth Gaffey Consulting in Boston.
Opyt wholeheartedly agreed. "The rumors are going to go around. [It's best] to acknowledge them and do what you can to let people know what is coming," she said.
Tip 5: Provide assistance with job transition
While all of the TechRepublic members interviewed received a severance package in their layoff, job services and additional compensation varied considerably. Most were provided free outplacement services to help them hone their resumes and interviewing skills, and one unemployed project manager even had the use of an executive suite with access to a fax machine, phones, and e-mail.
While a company may offer services, sometime the services are of little value. For instance, some employment firms don't have genuine recruiters on staff and basically just offer administrative services.
"You want somebody who will work hard to get your staff new jobs," said Gaffey. The HR consultant also recommended interviewing and talking with the outplacement and employment people before a layoff is initiated so that the provider can make sure it has access to the industry contacts employees will need.
A mix of common sense, empathy, and business etiquette
The best scenario, of course, is never having to deal with a layoff, but unfortunately, that's not the reality in today's economy. For those few tech leaders that haven't yet had to grapple with reducing staff, it's a tremendous opportunity to get up to speed on proper processes, appropriate methods, and solidifying support services.
What every manager should realize, said TechRepublic members and HR experts, is that staff cuts often have a lasting impact on "survivors"— employees retained— and layoffs can easily impede and thwart future innovation and productivity.
There's a real value in making sure that the retained employees understand the necessity of the layoff and that the appropriate respect and consideration was given to the reduction effort. Otherwise, anger, sadness, and job insecurity can fester into animosity and create a largely disgruntled workforce.
TechRepublic members believe CIOs and VPs owe it to their company's reputation, themselves, and the employee base to handle staff layoffs and terminations in the most professional and respectful manner.