The COVID-19 pandemic brought with it the largest number of job losses seen in decades. Many economists compared the staggering unemployment rate to the Great Depression. In April of 2020 alone, more than 20 million jobs became redundant as businesses scaled down operations to decrease losses. While it has been a challenging time for employees, CEOs, and business owners have had to make the tough decisions to let people go.
If you are a small business owner, you can imagine how hard it can be to let go of staff who helped build your business from the ground up. It can feel like laying off members of your own family. It is even more daunting during a pandemic, where each job loss marks more challenging times for a family. Yet, there is a way to handle layoffs with respect and compassion, allowing you and your employees to part on good terms.
Transparency is Key
It’s important to remember that the employees you will be laying off will have many questions. The last thing you want is to leave disgruntled employees dissatisfied with your explanation. First, if it’s possible, let the news be as personalized as possible. Generic emails or a two-minute announcement on a Zoom conference call just won’t cut it. If you can’t meet the employee in person, then schedule a dedicated Zoom call where it is just the two of you.
This kind of conversation will always be uncomfortable – there is no way around that. However, you can lessen the blow by arranging viable alternatives. One great way to do this is by contracting an outplacement service to provide assistance to employees as they transition. These companies are great as they can help find another, well-suited job fit for each employee. This way, even as your employees prepare to leave your business, they have a solid plan in place that puts them closer to finding their next job.
Create a Layoff Plan
Planning is the best way to think through a decision. A layoff plan will ensure that you stay within ethical, moral, and legal boundaries. It’s also what will guide you in deciding which employees to layoff and why. Ultimately, you want to avoid any sort of bias that may lead to unfairness in the process. A good layoff plan should be able to answer five key questions:
- What will be the criteria used to select those who will be laid off?
- What severance pay and benefits will be provided for the laid-off workers?
- How will the layoffs be scheduled?
- Who will oversee the entire layoff process?
- How will you keep the remaining workforce motivated?
If you can answer these questions confidently, then it should make the announcement and transition a lot easier for both you and your employees. It’s also important to consult a lawyer while handling the process to ensure you are within the law.
Keep Your Stakeholders Informed
If you’re downsizing your workforce, it will affect how you provide your products and your services. Even more significant considerations need to be made for small businesses. Usually, you’ll find that both your clients and your workers are from the same local community. A failure to effectively communicate your lay-off plan with your customers may lead to negative feelings and even the potential of the boycotting of your store.
Be sure to inform both your customers and suppliers well in advance of the expected changes. Additionally, ensure you communicate your commitment to working out a solution in everyone’s best interests. Finally, be sure that you can sustain the same quality of goods and services even after the layoffs.
A Better Way
Laying off workers will never be easy. However, if you can treat your workers with dignity and respect throughout the process, you can make the experience a little better for everyone.
