In the U.S., our well-being is inexplicably tied to employment, and by extension, our access to necessary benefits. Many founders don’t start companies thinking about their tertiary impact, but over time, they inevitably become part of the fabric that holds our society together.
While layoffs might feel like isolated events - where companies balance their books and wash their hands clean, they do have a ripple effect. The people who return to the employment search pool often carry the weight of their past experiences. When we approach these transitions with compassion, we create a healthier, more generous talent pool. The extra step you take today will come back to benefit both the individuals and the community in the long run.
This isn’t a HR guide. But it is a nudge; a reminder of our humanity and responsibility to each other. Here are a few practical steps to take when layoffs are or appear necessary:
- START WITH A COMPREHENSIVE INTERNAL REVIEW. Before making any decisions about layoffs, the first essential step is to gain a clear understanding of the organization’s current state. In my early days as an internal consultant, we were tasked with finding 20% savings across departments. By taking a deep dive into workflows and identifying skill gaps, we optimized existing resources and streamlined outdated processes. These kinds of thorough assessments provide insight about where efficiencies can be gained and reveal areas of excess, making it possible to cut costs without drastic measures. With a clear picture of your organization’s strengths and inefficiencies, you’re better equipped to make thoughtful and informed decisions about the future.
- REPURPOSING TALENT. After finding savings, consider ways to repurpose employees. Can you retrain them with new skills or redirect them to new projects? Or can you acquire new business to absorb the workforce?
- FURLOUGHING. Some management bodies forget this is an option. If your organization is experiencing a temporary downturn, consider retaining employees with a reduction in benefits.
- SIBLING COMPANY REFERRALS. If a layoff is unavoidable, tap into your company’s network. Can HR connect with sibling companies or other businesses you're in regular partnership with to help place employees?
- LAYOFF RESOURCES. When layoffs need to happen, offer support like interview prep, résumé reviews, and referral letters to those being let go. These services can be budgeted into the transition and oftentimes can be outsourced.
- DECIDE YOUR VALUES. If you’ve been employed since the pandemic, you’re likely no stranger to the annual whispers of layoffs. Can you commit to layoff thresholds? Is there a values checklist you can develop where laying off is the last possible solution? Lastly, place yourself in the shoes of the concerned. How might you want to receive the news? What kind of support might you be looking for?
Layoffs are as natural as starting up. Some organizational transformation initiatives do involve collapsing business lines as a company or the industry evolves. But the surprise layoff motif can be incredibly jarring, destabilizing, and can compound frustration in an already stressed workforce. How someone is exited from a company will likely affect their attitude entering their next role...which could be your company. Compassionate leaders can play their part in approaching these cycles in ways that uphold dignity, trust, and compassion.