The economic turmoil shaking international markets has already left a trail of casualties in the economy as companies feel the pressure of lower commodity prices, depressed consumer spending and limited access to credit or capital markets. As a result, many will be faced with one of the most difficult issues for any company — laying off employees.
Announcing layoffs is never seen as good news (particularly by those receiving the pink slip), but while most organizations have processes for informing people of a termination, fewer companies have plans for how to communicate the news to remaining employees who can be significantly affected by the changes. And with a reduced headcount, it is all the more important to retain a motivated and productive workforce to help see the organization through to better days.
There are three important considerations for communicating with the remaining employees: What is said, when it’s delivered and by whom.
News of a large-scale layoff can easily destabilize the remaining employees and, without a clear understanding of why it is happening, could have unintended consequences that can affect productivity. In preparing what to say, there are three questions that should frame what is communicated. Answer these three questions — with candour — and there is a better chance the remaining workforce stays engaged.
Why is this happening?
Identify the factors that led to the layoff decision. People need to understand the context in order to judge whether they think this was an appropriate resolution. While it may be obvious (an economic downturn, for example, is hardly a secret), it is important to explain the factors that led to the decision in jargon-free language that is relevant both to employees and the organization. Helping people understand the context improves the likelihood of buy-in — people may not like the decision, but they can at least understand it. Additionally, share information as to how those let go were treated. Explain the support and benefits they will receive to help ease their pain. Be empathetic and let employees know, even when times are tough, people will be treated fairly.
What effect will the decision have?
To counter speculation about what might happen, provide an assessment of the effects of the layoffs, such as closing of company locations or jobs moving offshore. Also, explain the impact on remaining employees, answering questions such as, “Will people be taking on new responsibilities?” or “Will there be new reporting relationships?” Employees deserve clarity about what is or will be expected of them in this new reality. Most will be keen to help the organization through a difficult time, so let them know how they can do this.
What is the long-term view?
Reducing a workforce is usually a last resort so explain what other actions have been taken by the company. Discuss the long-term prospects for the downsized organization. Is this a short-term turn for the worse or does it represent a new, leaner organization that will have a narrower focus in the future? People who joined your organization did so in part because of what it represented — they have the right to know if the new company will continue to meet their expectations.
Speed is of the essence in communicating news of large-scale layoffs to those employees remaining in the organization. Reports will spread fast through unofficial channels, regardless of a formal announcement, but the quicker the response from the company, the better the opportunity to frame the debate and curb speculation. This can be a logistical challenge, especially if the organization has operations in multiple jurisdictions (and operates in multiple languages), and can often mean racing to beat any online peer-to-peer communication. Therefore, advance planning is essential to ensure as many people as possible within the organization hear the news from official channels first. Impersonal communication can beat the clock but has significantly less impact than face-to-face discussions, so all efforts should be made for the company’s leadership to deliver the message in-person to remaining employees.
The decision to lay people off may be met with anger or fear by those still employed. Having the leadership deliver the news helps better manage these emotions as well as the message. The people who made the decision should be the same people who stand in front of those employees whom the company is depending on for future success. They need not — and should not — be alone. Front-line supervisors are a trusted source of information for employees and should be enlisted to stand alongside the company’s leadership in these difficult times. Supervisors also need to be equipped with the necessary information for any followup questions from direct reports.
It all seems rather straightforward and, in theory, it is — plan the message, communicate it early on and have the leadership deliver it. Be transparent and share the rationale for the decision and expectations for the future. And monitor feedback.
However, when layoffs occur, a company’s main focus is on those directly affected by the layoff decision, so it is easy to be distracted from thinking about and appropriately communicating to the ones left behind. But they are also affected by the decision and the company’s future success is dependent on them. Investing the time and effort to make sure they understand this chapter in the company’s history improves a company’s chances of emerging stronger.
Peter Block is a national managing partner and Gal Wilder is a senior counsellor at Cohn & Wolfe, Canada in Toronto. They can be reached at email@example.com or firstname.lastname@example.org.
Tips for employers
How to handle layoffs
For employers facing layoffs, here are a few guidelines and points to consider:
Plan in advance
: Downsizing is a crisis but, unlike other unexpected or unpreventable crises, it is known in advance so planning for the process is not only doable but critical.
Play on a level field
: To avoid rumours, speculation and misinformation, news of the layoffs should be delivered simultaneously (but separately) to affected employees and those who stay behind.
The personal touch
: Regardless of an organization’s size, geographic distribution or time zones, the termination process or notice must include a face-to-face communication with each affected employee. The notice should be made in a personal, caring manner by those involved in the decision.
Don’t burn bridges
: Be honest and empathetic and provide support (such as job placement consultation or counselling) and allow employees to leave with dignity. Whether you like it or not, these former employees are, and will continue to be, the company’s ambassadors and possibly even future clients or customers.
Walk a mile in their shoes
: Regardless of a company’s type, size or industry, these are real people and they should be treated with respect — nothing beats common sense and basic courtesy.
Align key messages
: Communications to all stakeholders must be aligned. Delivering different or contradicting messages will affect the credibility of the decision and the organization.