Too many companies botch mass layoffs. Here’s how they should approach them

By Jeanne Sahadi, CNN

You commute to the office only to find your security badge no longer works.

You log on to your work computer and are denied access.

A pre-dawn email arrives that you miss — especially if it’s sent ahead of a major holiday.

A dispassionate Zoom call is held with hundreds of people.

You get an automated call.

Or — surprise! — you get a severance payment for the job you thought you still had.

When it comes to mass layoffs, there seems to be no end to the worst, most bungled ways in which some employees first learn they are being let go. These all involve organizations blindsiding employees, leaving people feeling like their years of service and dedication meant nothing.

“People have to feel they’re being treated with respect,” said Sarah Rodehorst, CEO of Onwards HR, an offboarding technology platform for human resources, legal and finance teams. “[Some companies] treat the offboarding process like a transaction instead of a personal communication with people.”

One recent example of poorly communicated job cuts came last week when Google parent Alphabet laid off 12,000 people, first by a pre-dawn email and then by locking them out of the company’s systems and disabling security badges, according to multiple reports from former employees. (Google declined to comment, pointing instead to a blog post from the CEO on the day of the layoffs.)

Prioritize communication planning

As layoffs pick up across several sectors this year — on the heels of Microsoft, Goldman Sachs, Stitch Fix and others that have recently pared their headcounts — employers should give as much consideration to how they deliver the news as they do to all the financial, legal and HR components of a mass layoff, Rodehorst advised.

Otherwise, poor communication and mistakes resulting from a failure to communicate last-minute changes to all departments involved in the layoff can overshadow what the employer does right — such as offering generous severance and benefits.

It also destroys good will with outgoing employees, demoralizes the staffers left behind and could hurt the company’s brand reputation with potential hires, said Raymond Lee, CEO of CareerMinds, a virtual outplacement company.

Not to mention that the organization opens itself up to criticism on social media and in the press — as Better.com found out the hard way last year when CEO Vishal Garg laid off 9% of his company’s workforce in a video call that lasted less than three minutes. “If you’re on this call, you are part of the unlucky group that is being laid off,” Garg said. “Your employment here is terminated, effective immediately.”

“You spend a lot of effort in onboarding and treating people well. But when it comes to offboarding it’s almost an afterthought,” Lee said. “You want your employees who are exiting to say, ‘I really enjoyed the years I’ve given to the organization.”

A better way

A layoff may be a business decision for the company. But it’s entirely personal and highly stressful to the laid-off individual. So handling how the news is delivered compassionately is critical.

Let people know what to expect. Even if you don’t give a lot of advance notice, give some once a layoff is ready to be executed. Employees should receive a communication from the CEO or from division leadership that informs them layoffs will occur and offers them the business reasons for the decision.

That communication should also let people know what to expect if they’re going to be directly impacted — for example, explain that they will receive a meeting invitation with their manager or will receive an email that will include next steps.

“Advanced communication is key,” said Andrew Challenger, senior vice president of outplacement firm Challenger, Gray & Christmas.

Notify people individually. Both Lee and Rodehorst stressed that employers should always aim to set up personal meetings for the affected employee with their manager and HR contact. Besides directly delivering the news that an individual’s job is ending and offering information about severance, benefits, outplacement services and other important details, the manager and HR person should make themselves available for questions during the meeting and after. This ideally is done face to face, but if that’s not possible, a remote video meeting can work too.

“You have to give people an opportunity to respond to the situation. You need to have a plan for how an employee can follow up and get their questions answered,” Rodehorst said.

If individual meetings are not possible, then notify people by way of very small group meetings. By “small,” Lee means no more than 5 to 10 people, including a leader or manager they know who delivers the news.

The rationale is two-fold. The employees have some sense that their privacy and personal situation are being respected, and the organization can reduce the chance an employee will air their grievances publicly.

The more people who are in a meeting, the more likely it is one employee will videotape it and post it on social media, Lee said. With very small groups, “you minimize the risk of something bad happening.”

But even keeping things small won’t prevent disgruntlement or demoralization if you don’t also stress that the layoff has nothing to do with a person’s performance. “Leaders must remember the turmoil that will result in their workers’ lives and highlight that the decision has nothing to do with the impacted employees’ talents. Exiting employees … should know they are valued as they are leaving,” Challenger said.

— CNN’s Catherine Thorbecke contributed to this report

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