The Do’s and Don’ts of Managing Layoffs

The past few years have been a challenging time for many businesses. Economic fluctuations, operational changes, and the rise of AI technologies are reshaping industries. In some sectors, layoffs have become a common part of the landscape.

But while layoffs are sometimes necessary for businesses to stay afloat or evolve, they can be a tough process for both the organization and the affected employees. Handling layoffs with care and professionalism can help maintain morale, protect the reputation of your business, and ensure that the transition is as smooth as possible for everyone involved.

Here’s a look at the Do’s and Don’ts of managing layoffs in a way that is respectful, transparent, and supportive.

The Do’s of Layoffs

1. Do Provide Clear and Honest Communication

Transparency is key when communicating layoffs. Employees deserve to know why these changes are happening. Whether it’s due to restructuring, economic hardship, or the introduction of AI technology, honesty will help employees understand the situation better.

• Tip: Ensure that communication about the layoffs is consistent and clear, and that all employees hear the news from their managers rather than through the grapevine.

2. Do Offer Support and Resources

Layoffs can be an emotional and financial burden for employees, especially if they have been with the company for a long time. Make sure to provide support during the transition.

• Offer severance packages, career counselling, job search assistance, and outplacement services to help them secure their next role.
• Tip: Providing support shows that you care about your employees and their future, which can help protect the reputation of your company.

3. Do Make Sure the Process is as Respectful as Possible

Treat employees with dignity and respect during the layoff process. This is a sensitive matter, and how you handle it will impact not only those affected but also the employees who remain.

• Tip: Conduct the layoff meetings in private, and ensure that the discussion is respectful and empathetic. It’s important to maintain professionalism and empathy, even when delivering tough news.

4. Do Keep Employee Morale in Mind

Layoffs can create an atmosphere of fear and uncertainty, particularly among remaining employees. After the layoffs are complete, it’s important to rebuild morale and keep teams engaged. Be transparent about the reasons behind the decision, and reaffirm the value of the remaining employees.

• Tip: Host a company-wide meeting to discuss what’s next for the business, address any concerns, and outline how the company plans to move forward.

The Don’ts of Layoffs

1. Don’t Make Layoffs Publicly About “Low Performers”

It’s tempting to explain layoffs in terms of letting go of “low performers” to minimize any backlash. However, this can backfire, especially if it negatively impacts the future job prospects of the affected employees. Good organizations care about their employees, even when letting them go. Avoid casting the situation as a judgment of personal performance.

• Tip: Focus on the business reasons for the layoffs (e.g., restructuring, economic necessity) instead of framing them as a performance issue.

2. Don’t Delay or Procrastinate Communication

Delaying communication can add unnecessary anxiety to the situation. It’s important to act quickly and let the affected employees know as soon as the decision is made. Procrastination can also damage trust and increase speculation and fear within the company.

• Tip: Have a plan for communicating the layoffs as soon as possible, and ensure all affected employees are notified directly and privately before the news is shared publicly.

3. Don’t Leave Employees in the Dark About Next Steps

Once the layoff process has been communicated, it’s essential to provide employees with a clear roadmap of the next steps. Whether it’s finalizing their severance package, returning company property, or receiving outplacement assistance, employees should feel supported during the transition.

• Tip: Ensure employees know exactly what will happen in the coming days and weeks. Providing clarity will help reduce stress and uncertainty during an already difficult time.

4. Don’t Ignore the Emotional Impact

Layoffs have a profound emotional impact on employees. Ignoring these emotions can lead to resentment, disengagement, and a loss of trust in the leadership team. Acknowledging the emotional difficulty of the situation and providing emotional support is key.

• Tip: Be empathetic during the process. Offer emotional support, and, if possible, make resources available for employees to talk with someone about their feelings and concerns.

Handling Layoffs with Care

While layoffs are sometimes necessary, they don’t have to be a painful experience for everyone involved. By following these Do’s and Don’ts of layoff management, you can help make the process as respectful, supportive, and smooth as possible. At the end of the day, it’s about treating your employees with respect and helping them transition to their next role with dignity.

And to help make the process even easier, we’ve created free resources for you. You can use it to ensure that your approach to layoffs is clear, structured, and compassionate. Download the Redundancy/Layoff Agreement Template, Termination of Employment Letter Template and the Employee Offboarding Checklist template now.

First published on the HR Partner blog.