Phillip M. Perry (Apr/May 09)
When it becomes necessary to cut staff, how you conduct yourself is as important as whom you let go.
"Layoffs are inherently stressful, both for the people conducting them and the people who suffer their consequences," says Ian Jacobsen, president of Jacobsen Consulting Group in Sunnyvale, California. "The stress can be lessened and morale enhanced when layoffs are done ethically and professionally."
Jacobsen suggests preparing your work force for the expected terminations with a communication such as this:
"We have seen our business fall off over the past months, and have taken _________ actions to combat the decline. What we have done has not been enough to eliminate the need for a layoff. We are now at a point where we need to cut staff. This is painful for all of us and we hate to do it, but it is necessary for the survival of our business. We have done a careful study of the future for our business and the talent we need now and into the future. It is within this context that we have decided whom to keep and whom to let go."
"People won't like being laid off, but they can accept it better when they understand that it is the result of a careful process and plan for the future," says Jacobsen.
Meet individually with each employee to explain why the individual is being let go or retained. This one-on-one communication is critical for morale and credibility. Jacobsen suggests an approach like this:
"John, in view of the cutbacks we are having to make, we need the remaining staff to be as flexible as possible. You are very competent in ________, but we need someone who is also competent in ________ and ___________."
"John may not like the decision, but he'll respect you for your thought and honesty," says Jacobsen.
When you meet with each individual being laid off, present a letter confirming the layoff and related arrangements. Cover areas such as these:
• the reason for the termination;
• the last day of work;
• check-out procedure;
• severance pay and conditions upon which severance pay is based;
• pay for unused vacation and sick leave, if applicable;
• outplacement assistance, if applicable;
• continuation of insured benefits and COBRA, as applicable;
• where to apply for unemployment insurance; and
• a reference letter, if you provide them.