Mass layoffs and restructuring are deemed necessary in order to respond to changing consumer habits, new technology and economic factors. Now a global pandemic has forced companies to make incredibly difficult choices. Even with all the best intentions, corporate change and layoffs are difficult for a company to get right from a people perspective.
According to employer brand consultancy Blu Ivy Group.
The way in which employers demonstrate their care and value of employees, before, during and after employment with the company will affect the way the world views their organization. Insensitive practices around terminations not only reflect poorly on the workplace culture, they may also damage the employment brand itself.
When layoffs happen, most organizations will take a more immediate approach, also known as the “amputation” approach. The unsuspecting employee is pulled into an unscheduled meeting and confronted with the news that they will be losing their job effective immediately. They are then walked through a severance package and any outplacement services they will receive. Pre-COVID, they were then escorted to their desk, where they will be relieved of their computer, mobile phone and pass-card—now and always “company property.” The former employee is accompanied to the building exit, carrying a hastily-packed box of belongings and a taxi chit.
Companies have their reasons for taking an immediate and seemingly cold approach. But unless you’re letting someone go for cause, this is not the method First 30 recommends. The world is simply too small.
In what we refer to as the “soft gloves” approach, employees will receive “working notice.” In this circumstance, a team member is informed their role will no longer exist within a specific time frame, normally four to six weeks. They will remain employed with the company until the end of their notice period. Often, the affected employee is invited to apply for other roles within the business. Providing working notice is the far more humane approach, and holds benefits for the employee AND the employer.
It Demonstrates an Employer’s Commitment to their People
Many companies refer to their employees as a family. As such, they create an identifiable culture among their team members. They make promises to employees. When layoffs happen companies may not be breaking a legal contract, but they are breaking a psychological contract, and this contract extends throughout the business. When companies cut an employee off from the business in a matter of moments, it doesn’t simply impact that specific employee’s experience, it impacts the experience of all employees. The soft gloves approach is a demonstration that a company genuinely cares, particularly when support for finding a new job is apparent.
It Keeps Remaining Team Members Focused
A phased and thoughtful approach to layoffs will offer security to remaining employees. They will be confident should the same fate befall them, they will have the time to process the layoff, say goodbye, receive support from their employer, and leave the business with their dignity intact. We often fail to recognize the importance of dignity in this situation. When layoffs are the result of extenuating circumstances, and not with cause, there is no reason a person should leave the business feeling ashamed. They should leave feeling valued and supported. Allowing an exiting employee the benefit of time and open dialogue will allow everyone, including employees staying with the business, to find closure and move forward positively.
It Improves an Employer’s Brand
There will always be people who will be disgruntled no matter how fairly they are treated. A company’s objective is to avoid negative PR from the employees that must be moved. As stated at the beginning of this article, the world is small. Nowadays social media gives everyone a platform, and platforms like Glassdoor actively encourage employees to rate their current and previous employers. When an employee is treated with consideration during a layoff, they are far more likely to speak positively about a former employer on social media. They are also more likely to recover quickly and move onto another role which means they are less likely to dwell on a perceived injustice.
It Signals Top Talent
The fight for top talent is real, and top-tier performers do NOT want to work for companies who are perceived to treat employees unfairly. All companies will go through transition and change. This is natural and expected. Not all companies will take care of exiting employees by giving them working notice, helping them find work and offering outplacement services. In a world where priority is given equally to flexibility, workplace culture and compensation, a company that demonstrates they care will stand out to top talent, a point of difference that can shift scales.
Many will argue the amputation approach is better. It’s less risky, exiting employees won’t have the chance to steal company property, secrets or client lists, and people staying behind can move forward without being distracted by their exiting colleagues. It also may be cheaper.
At First30 we understand that some businesses have no choice but to take an immediate approach to terminations. But we invite those businesses who do have a choice to consider the long-term impact to their employer brand, their customer brand, their desire for top talent and the implications on their culture. And also, on how remaining employees will feel.
Let’s simplify the idea. How would you, the person reading this article, feel if you were exited and immediately cut off from your employer and colleagues? What would you think of this employer? What would you say about them? Conversely, how would you feel if you were able to stay for four to six weeks, say proper goodbyes, look for work during this period, and continue a dialogue with your leadership and HR?
The choice seems pretty clear to us.