It’s never easy, but there are ways to make the experience a more palatable one for everyone involved.
It was reported that the US-based mortgage company head made the announcement remotely, and with “little emotion,” to more than 900 people, right before the holiday season.
“If you’re on this call, you are part of the unlucky group that is being laid off.”
He then went on to say that employees could expect an email from HR detailing benefits and severance from the company.
As a side note — the Softbank-backed mortgage lender announced in May it was going public through a SPAC and last week received $750 million in cash as part of the deal.
While it is never easy to let staff go, there are some clear dos and don’ts of the process.
1. If you can, choose your timing wisely. While it’s not always possible to avoid, pre-Christmas can hit people harder than other times of the year. Not only is it an expensive time, but it also brings with it a lot of emotion for many. Losing your job before the festive period can leave people more bitter than they need to be and remember, those who have worked for you will step out into the talent pool again. Their first-hand accounts of having worked in your organisation will carry weight with potential candidates out there.
2. Methodology — always done one-on-one, in private. Common sense tells us that terminating employees should never be done out in the open. It is a deeply personal and private matter that always needs to be managed delicately between and organisation and the employee. The lack of privacy shown when firing someone in the open eats away at their dignity and their pride. So, the rule of — treating others as you would like to be treated is an important one to remember here. Show empathy and compassion when handling the news.
3. Internal first, external second. The last thing you want is for people to hear they are losing their jobs from the media. Make sure that your people are the first to know. If you are a listed company and need to disclose to the market, make sure that your people are briefed the second you are able to tell them. Don’t let them read about it in the morning’s online news.
4. Be aware and be emotionally intelligent. This was touched on earlier but it’s a crucial point to emphasise. The consequence of the sheer lack of awareness of the impact and therefore the flow-on impact on personal and organisational reputation and the business’s ability to attract top talent into the future. Past employees will talk about you and their exit. You can either make it a respectful and amicable separation or you can fuel the fire. There are no two ways about it, if you give them a load of dirty laundry, they will air it.
5. The impact on survivors. Many who ‘survive’ an organisational slim down can feel incredibly betrayed and hurt on behalf of their colleagues, particularly if they have witnessed loyal people being treated with disrespect. These people, although still with your organisation in body, may begin to start thinking that they don’t want to be next in the firing line, and may even start planning their next move. This will absolutely ensure your company morale takes a hit. Remember, colleagues, talk, employee engagement can be easily broken and momentum can gather quickly.
The flip side is that if they have seen their former colleagues treated with respect, they feel better about their continued employment and secure in their roles knowing that your organisation does ‘the right thing’ by its people. Look after the talent you have and offer support to those who are staying and to those moving on. Outplacement programs for former employees, for example, will pay back dividends in the future.
Reducing headcount or ‘letting people go’ is a process that many in the corporate world will come across (in some form) multiple times throughout our working lives.
While it’s never a pleasant task, there are ways to soften the blow and the consequences of not doing so can be greater than you realise — for you and your business.
For more information, please visit www.reddingroup.com.au