One aspect of running a business that is never easy is when you're faced with laying off or terminating an employee. Tactfulness certainly comes into play here, as does empathy, respect and honesty. Especially when you otherwise appreciate the employee but have to let them go in light of financial reasons or because of infrastructure changes. In those cases, terminating that employee can be a truly difficult task. So how exactly should you approach this type of situation?
Remember, terminating or laying someone off is not just about the employee in question. Terminations can impact the people left behind and the company culture as a whole. Ideally, you can find a way to let someone go so as to minimize the negative impact it can potentially have on your organization, its culture and employee morale.
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Reasons for Laying People Off
Letting people go is always emotional and unpleasant. When the rationale behind a termination is not related to job performance but rather to downsizing, the process can seem particularly tough. The same can be said of layoffs. Typical reasons businesses need to lay people off or terminate employees, other than poor job performance, include:
Especially as numerous companies are in rebuilding mode or are experiencing economic difficulties, among key cost-cutting measures is reducing staff size.
Merger or Acquisition
It’s not uncommon for a company to be bought out by a larger firm or to merge with another company; in the process, employees may get laid off in light of job overlap, for example.
Switching To an Outsourcing Model
In line with cost-cutting measures, the increased use of third-party independent contractors enables companies to eliminate some of their employee-related overhead.
Depending on the industry, yours may be a seasonal-based operation. Therefore, you might be faced with having to lay people off during the slower periods.
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Best Practices for Terminating/Laying Off Employees
Whatever your reasons for needing to terminate or laying off employees, you will also need to take into consideration the mindset of the “survivors,” especially if you are laying off multiple employees at one time. Survivors are those individuals who are left in the wake of layoffs or terminations.
“Layoff Survivor Syndrome” can manifest itself in a number of ways, from employees expressing anger at the company, to a loss of productivity to employee resentment at having to take on more work. This is why terminating personnel can be such a multi-faceted process as you also have to navigate the emotional and mental states of those who are still working for you.
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Employers who adopt the following best practices will help employees leave with dignity and demonstrate to survivors the company cares about people – both those who have been let go and those who remain.
Deliver the News Face-To-Face
While in some situations this may not be feasible depending on remote work circumstances and where employees may be located—in which case a video call would be in order—it is best to try and create a face-to-face scenario. Take extra care to convey sympathy.
Avoid Having the Conversation on a Friday
The fact that unemployment and other resources for finances and job searches are less available over the weekend can create additional stress for separated employees.
Communicate Clearly and Concisely
Imparting a short, direct message allows the other person to more easily process what you’re saying, especially when the news is unwelcome. For example, you might start by saying: “I’m sorry, but we are terminating your position effective next week.”
Compliment some aspect of the employee’s past performance and stress that the person did nothing wrong and that the termination is not anyone’s fault.
Ideally, that means outplacement services. But help can come in many forms, from providing ideas about where to look for a new job to writing a letter of recommendation.
Don’t candy-coat the news or promise anything you cannot guarantee, such as implying you can rehire a terminated employee when the company’s financial position improves.
Give employees the opportunity to express their fears or anger and respond in a calm, sensitive manner.
Be prepared to address logistical concerns, such as the status of the employee’s last paycheck, health insurance and 401(k) account.
Reassuring Remaining Employees
The same principles outlined above apply when communicating with remaining employees about the company’s layoffs. Survivors will have concerns and questions. They may experience a range of emotions that could include guilt, sadness and trepidation. As noted, they may also be angry with the company.
Acknowledge employees’ feelings and provide regular opportunities to discuss the emotions they’re experiencing. Reassure them through words and actions, such as providing additional career development opportunities that demonstrate how much you value them.
Be as honest as possible about why the layoffs were necessary and how the company plans to adapt. If possible, hold one-on-one meetings with employees who remain, so you can personally stress the important roles they play in the organization’s ongoing success.
Showing compassion and respect to employees, whether they’re leaving or staying, is always the right approach. Besides mitigating ill will on the part of the departing employees, it helps surviving team members feel valued and remain productive. If you need help navigating a difficult situation involving employee terminations or layoffs, we are here to help. Our experts have worked with hundreds of Kansas City businesses, and we are ready to assist you. Call today!