Layoff Communication – How can firms get it right?

Nimrata Kapoor

As companies weather the economic storm unleashed by the pandemic, it has become common place to freeze hiring, delay joining and also take the tough call of layoffs. The question is can the layoff communication be done with dignity and in a humane manner?

  “The more an organisation is prepared to communicate, help employees find and transition to new jobs, and provide support to remaining employees, the lesser a toll the restructure will take on individuals, company culture, and the employer brand,” says Joel Paul, General Manager, Randstad RiseSmart India.

 Let’s see what the best practices of layoff communication from some top firms are"

 1.   Avoid “Out of the Blue” communication

It is very essential to have a dialogue with employees. Brian Chelsky of AirBnB mentions in the layoff email that it is the 7th time he is talking to employees. He was constantly communicating with employees and on social media platforms and discussing the situation. He also acknowledges that layoffs were not on the table earlier but are confirmed now. This is an excellent example of communication during crisis when it is a time of immense upheaval.

 2. Prioritise Internal Communication

Related to the first point, a key finding is that leading organisations prioritise internal communication. Pivotal to the success of the communication strategy is having a cross- functional communication team in place who firm up the messaging, its frequency and ensure that consistent training is provided to managers. Releasing a press note after a board meeting approving layoffs and subsequently setting in motion the internal communication process without having had employee dialogues on the crisis and steps that the firm has been taking over a period of time can be disastrous. Joel Paul makes a pertinent observation, “When businesses include sequential communication like managerial notifications, general internal and external announcements, and notices to employees in a concise, well-planned manner, it helps them explain why a layoff was necessary without making excuses or laying blame within the organisation.”

 3. Provide Reasons

Studies have repeatedly proven that layoffs for wrong reasons will almost always lead to a dip in company stock price and employee performance, besides increasing the likelihood of the firm filing for bankruptcy. Employees appreciate the opportunity to contribute to cost cutting and revenue generation ideas in the early stages of business downturn and are more willing to accept the layoff when they know that the firm has done its best and has been transparent.

Ultimately, it boils down to a decision about people – who to keep and who to let go. Skill and potential mapping are important so that the company is not letting go those who may be needed in the near to medium future timeline. Layoff needs to be delinked from performance reviews, which anyways need to be an ongoing process for teams to avoid carrying dead weight.

 4.  Empathise and support

A layoff is a traumatic event for the employee. As EMIs, school fee, household expenses loom before the individual, no severance package is good enough as it is really tough to get a job in Covid-19 times.

It is equally stressful for the manager delivering the message who is tugged between duty and compassion. Being able to walk the thin line between empathy and respect for the individual vs sympathising with her and painting a rosy picture of the future is not easy. Firms with respect for employees in their DNA are more likely to invest in training their managers on the finer aspects of layoff communication and provide counselling support for employees. Having a humane severance package, providing concessions on equity vesting timelines, with provision for additional months of insurance etc. is important. Tie up with an outplacement assistance provider for resume services, job search or career transition coaching. Explore the possibility of engineering employer-to-employer deals to outplace impacted employees.

 5. Strengthen your alumni programme

AirBnB’s layoff communication stressed on revving up the alumni programme. Many leading firms give preference in hiring to their ex-employees, and some even offer a hiring bonus to ex-employees. AirBnB is encouraging its remaining employees to help find roles for those leaving. Allowing departing employees to retain their laptops as they embark on the arduous job search process is a small token of respect for them. Cultivating an active alumni network is always a smart investment for firms, whether it is networking, hiring or crisis assistance. The strong bonding reflects the firm’s culture and has a positive multiplier effect on the employer brand.

 6. Motivate the survivors

This is of course easier said than done. A layoff has unintended negative impact on the survivors, who can get jittery about their fate and lose trust in the firm. It is very important for firms to address the elephant in the room and have an open and transparent dialogue with employees. Being transparent about the company financials and business outlook is the need of the hour. Continued communication via different channels and offering EAP (employee assistance programme) support for counselling after the initial shock and denial helps revive employee engagement. Leading by example with a positive mindset, not putting undue stress on employees, encouraging contribution of ideas and prototypes, and organising team-bonding activities, play an important role in restoring employee morale.

Layoffs are never easy. Leaders taking the initiative to drive transparent communication and their strong will to do the best for their teams make all the difference. Engaging with external partners and remaining employees to find jobs for exiting employees, providing EAP or counselling support, humane severance packages, active alumni networks are some of the strategies that can soften the blow and strengthen the employer brand in the long term.

— The writer is HR Advisor and Career Coach (www.nimtalkingtalent.com) 

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