How to Lay Off Employees

There are many things in life which can be done multiple ways, such as skinning a cat. Even skinning a cat has some wrong ways (like using your teeth to do it). Some managers think they can do no wrong, and that is where they get themselves into trouble. One of the most volatile and delicate issues must deal with pertains to the letting go of employees. Of course, this activity, while necessary, is not a pleasant one for parties involved. What managers can forget, though, is the way a layoff is handled greatly affects employees who are retained.

What I have to offer is from my personal experience, but there is a strong lesson about what not to do when you must lay off employees. I was working for a company once that - for a number of reasons - needed to let go a sizeable chunk of the office. It was a large office, and when all was said and done approximately half of us did not make the cut. Worse, though, was the way the workforce reduction was handled.

Everything about the layoff was kept secret until the day (dubbed "Black Friday" by those who survived) of the layoff arrived. It was rumored upper management decided on the layoff several months before, but decided any advanced notice would not be wise. Why they decided this I will never know, but the effect of that decision was very negative.

Someone in HR who knew of the coming storm decided to let one friend know in advance so she could be prepared. That one friend told a couple of her friends, and soon the majority of the office knew about the layoff weeks before it happened. The spread of information happened in whispers amongst the cubicle farm, and many variations for the reasons and method of the layoff process were thrown around.

Management, of course, caught wind of the rumors too late. Rather than openly acknowledge a layoff was coming (this was two weeks in advance) they vehemently denied any such action would take place. Then they suspended all business travel indefinitely and posted job openings of higher positions that would be unaffected by the layoff. The point of the job postings was to see which workers out of the positions to be eliminated they would retain and promote.

We quickly realized that quite a few new employees had been hired in the previous two to three months, after the layoff had been planned. A circle of friends speculated what management wanted to do with the newbies. We all knew deep down inside none of them would be kept. These new hires were pawns in the game of smoke and mirrors, a move to keep other employees from suspecting anything.

The day the layoffs occurred, management made their next huge mistake. The way the laid off employees were told the bad news caused quite a bit of emotional damage not only for them but for their coworkers. Everyone was kept in their cubicles "working" while managers tapped employees on the shoulder and pulled them into one-on-one meetings in quiet rooms where the bad news was delivered. The laid off employees were then escorted to their cubicle, the manager carrying an empty box. There the employees loaded their personal belongings - many emotionally - in open view for everyone else to see. Retained employees watched in horror as this scene was played out over and over, wondering if they would be next.

Once the carnage was over, management made one more bad move. They rounded up the "survivors" into a large room, and then went over why the layoff occurred and what the plan was for the coming weeks. Management went so far as to tell everyone in the room congratulations for "making it." Needless to say, survivor guilt was prevalent among the retained. Direct managers then took employees to celebratory lunches, where the solemn mood continued to prevail.

One reason cited by upper management for the workforce reduction was to raise the level of professionalism in the office. With this higher level, they promised "healthy" pay raises to those who made the cut. The pay raises that came (months later) were small for many, and non-existent for the rest. Many in the office speculated on what kind of pay raises management must have received.

After the layoff, morale in the office was very low. It is my personal belief it would have not been so low if the layoff had been conducted better. Grumblings about how things were done could be heard all over. Many of the best retained employees left a short time later.

What are the best ways to perform a large layoff? There are a lot of schools of thought on this and many good articles on the subject. From my experience, it is obvious that the way this layoff was conducted was sloppy, unprofessional, and generated a lot of mistrust in the lower ranks. Choosing how to conduct layoffs can greatly affect the work performed by those employees you retain.