Why Does Your Layoff Strategy Matter?

Nobody enjoys letting staff go. Read these tips for how to lay off employees compassionately and manage difficult situations effectively.

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Why Does Your Layoff Strategy Matter?

Here's what you need to know:

  • Exploring all alternatives before resorting to layoffs is essential
  • When faced with layoffs, compassion and respect are important for all parties involved
  • An honest dialogue will go a long way in protecting the company's reputation and ensuring no future issues if the employee returns to work after the layoff
  • In offering support, be mindful not to apologize or agree with the staff member
  • Taking the time to organize necessary paperwork and resources for laid-off staff will eliminate additional stress for them
  • Provide ongoing support to remaining employees to ensure teams can get back on track

The restructuring of employees, resulting in layoffs, is a common way for management to cut costs in the short term. In the last 2 years, though, layoffs have occurred more often due to an uncertain economy.

Many companies look for alternatives to keep their staff. Still, many others had to lay off large parts of their teams because of continued economic issues.

The layoff strategy, both with the laid-off employees and the ones who stay, matters. Business owners who’ve worked through all other alternatives before deciding to lay off staff should have a plan in place.

One solution is offering an open conversation about the alternatives that were considered with staff to maintain transparency. When faced with layoffs, compassion and respect are important for all parties involved.

What are the alternatives to laying off employees?

What are the alternatives to laying off staff? These might include all employees taking 1 day off a week without pay, dismissing contract and temporary employees, or allowing veteran employees an early retirement or buy-out option.

It might be necessary to consult the Human Resources team or an employment lawyer to understand what options are available, but checking every box before resorting to layoffs is essential.

If there are no other options, then it’s necessary to talk with all staff regarding the company’s issues. Provide any available information. This will increase the trust staff have in the company and provide transparency. It’s always better to provide various scenarios when faced with difficult choices.

A layoff strategy with an empathetic approach

No one enjoys letting staff go. In the past 2 years, it’s especially difficult given the world’s unknowns. With the assistance of the Human Resources team, creating a layoff plan is the best way to move forward ethically and professionally.

The layoff plan should consider several questions, including how the laid-off employees will be selected. It should also determine when the layoffs will occur, whether severance pay or benefits will be provided to the employees, and how the remaining workforce will receive support.

It’s important to make sure there is no discrimination in the layoff process. Consider what roles are vital to the team, what team members are cross-trained and can provide assistance to another facet of the business, and what teams can handle losing members and still be productive.

To eliminate any issues, some companies choose to lay off entire shifts. In contrast, others operate based on when an employee was hired. Whatever the choice, make sure that it is even across the board.

How to work and communicate with laid-off staff

Meeting with laid-off staff individually provides them the opportunity to process and ask questions they might have. If possible, meet with them face-to-face. This takes time, but it is best for the employee to have that 1-on-1 time.

It may seem more efficient and easier for everyone to announce the layoffs in a group. Still, this tactic only creates mistrust and stress for the employees who stay — not to mention the resentment it causes with the laid-off group.

Make every effort to support staff as they will remember how the company treated them.

Have HR representatives available to offer possible alternative employment solutions or help with paperwork moving forward. This can simplify the benefits transition and any other navigational tools the staff may need.

It is also smart to have at least 1 other person assisting in these discussions. Make every effort to support staff as they will remember how the company treated them.

If the company is in the position to offer severance packages or extended benefits, have that documentation ready, along with any legal paperwork that needs signing before staff leave.

An honest dialogue will go a long way in protecting the company’s reputation and ensuring no future issues if the employee returns to work after the layoff. Respect is crucial at all times, but especially in difficult situations.

How to handle tense situations with laid-off staff members

Letting someone go is never easy, even if it is only temporary. As a business owner, knowing what to say in emotionally charged situations where anger might be fueled is important.

It’s even more important to know how to listen. Be mindful of your tone, and do not cut off the employee. Give them time to express how they are feeling.

If they escalate, use a soft tone that is calming. Make sure to not come across as condescending, as this will only increase the tension.

In offering support, be mindful not to apologize or agree with the staff member. This can be difficult, but crossing that line can cause difficulties down the line if the staff member continues to feel slighted and takes the legal route to solve their frustrations.

This is a good reason to have another person in the room during these conversations. It protects both the employer and employee if issues arise.

How to support remaining staff members after layoffs

There is a brief moment of relief for the remaining staff, realizing they’re still employed. For many, that relief turns to fear that they may be next, worry about how the work will get completed, and guilt that they remain.

These feelings take time to sort through and, in some instances, may result in lower productivity. It’s almost certain that morale will take a hit.

If the company was upfront about the situation, the shock of the layoffs might be briefer than if they were a surprise. Management should still expect a period of grieving, so to speak. Make sure supervisors and Human Resources representatives are available to talk with staff if needed.

It’s important to remember that work and personal lives often blend, so laid-off and remaining staff may both suffer from disconnected relationships.

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The bottom line when it comes to reducing the workforce

There is no easy way to reduce the workforce. There are steps to take to ensure everyone feels supported throughout the process. Create a carefully laid out strategy to assist management in working through any issues.

Proper preparation is key. Taking the time to organize paperwork, benefit plans, and necessary resources for laid-off staff will eliminate additional stress for them and provide them with a sense of dignity.

Once you’ve taken these steps, it’s important to pay attention to the team you will continue to work with. There may be fear and confusion surrounding the layoffs, despite your best effort to be upfront and honest about the decision.

Extra time may need to be spent with individuals to allow them the chance to ask questions and talk about what happened.

As the business owner, empower your supervisors to talk with their teams as often as they need to until everything is running smoothly once more. Any change, but especially a staffing change, is bound to cause morale to take a hit.

You need to be compassionate in an efficient way so your teams can get back on track. Deadlines and projects cannot fall behind as that will cause further issues.

Finally, take care of yourself and your supervisory team. It’s not easy to make these decisions, and they can take a toll if you’re not properly assessing the needs of your top team as well.

Rather than push thoughts and feelings under the rug, process them and work on a game plan to progress forward. If done correctly, your team can get on top of the changes and be more successful than ever.

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