Layoffs, regardless of how many workers you have to let go or the context of the decision, are always a difficult process. But with the possibility of a recession in the near future, it’s especially important for HR teams and business leaders to begin thinking about how they may conduct layoffs in the near future.
Below we’ll look at how to make fair decisions when letting workers go and how to decide who to lay off.
What are layoff decisions?
Layoff decisions involve the entire process from acknowledging that you have to let go of workers to evaluating your current/future needs and eventually making the decision to let an employee or set of employees go.
The basic steps are 1) deciding that it’s in your company’s best interest to let employees go, and 2) deciding which employees stay and which employees go.
There are a variety of legitimate reasons that you might have to make layoffs. Some of these include:
- The need to reduce costs.
- Reshaping your business and business structure.
- Eliminating a specific service or function that you will no longer offer.
- Relocating to a new region.
- Employee misconduct or behavioral issues interfering with your business/workplace culture.
The challenge with deciding who to layoff
There are a number of challenges that come with layoffs. First and foremost is the impact it has on your employees’ lives. If you’ve spent years with the employees in question, you may have built friendships and bonds beyond the business. The actual layoff meeting is often an emotional experience for both the employee and the hiring leader, and being prepared for the emotional aspect of the process is something business leaders need to be prepared for.
Layoffs also have a negative impact on employee morale, especially if you have to let go of several employees. The effect layoffs have on your remaining employees, the possibility of legal action, and bad press are all things you have to consider when conducting layoffs.
Finally, there’s the difficult decision of deciding who has to go and who gets to keep their job. HR leaders and management want to make fair decisions, and deciding who to layoff is one critical element of the process that you have control of.
How to decide who to layoff
There are a few overarching strategies that will fit most businesses and allow for a fair and objective method.
Some ways to help the decision-making process include:
- Letting go of your most recent hires.
- Looking over your past employee assessments and employee reviews.
- Ranking employees and identifying which are the most valuable based on their skills, productivity, and past-accomplishments.
- If you’re restructuring your company, services, or goods, you may have to cut departments or employees that don’t fit that future structure.
- Letting go of part-time or contingent workers as opposed to full-time employees.
Steps in making layoff decisions
Your methodology and criteria for making layoffs is as important as who you decide to layoff. The more objective and thorough you can make your methodology for letting off employees, the more likely you are to make fair layoff decisions.
This is important because it will allow you to explain the decision to employees more easily and with more credibility. Additionally, it will allow you to protect yourself in court more readily if any employees decide to take legal action.
Steps you should take in making your hiring decision should go as follows:
- Evaluating what your company’s needs are going forward. If you know where you’re headed, you can have a better understanding of which employees fit that future and which do not.
- Make a decision on which departments or teams will be cut. The groups or teams that least fit the vision of your company will be the most natural to cut.
- Define your criteria and methodology for making the cuts. Again, you might decide to cut the newest employees, part-time/contingent employees, or create a merit-based system for ranking.
- Create a list of who you will cut and evaluate how much productivity you will lose. The layoffs will enable a transition period that you also have to be ready for when you make the decision.
Making your layoff decision strategy
Once you’ve decided where your company is headed, what your needs are, and who to lay off, you need a strategy for communicating with employees and creating a smooth transition. You may have to provide a brief training meeting with hiring managers and team leaders to remind them of common language to use and best practices to follow in the layoff process.
How Crosschq can help with employee layoff assistance
Crosschq’s cutting-edge platform can help companies in the layoff process in two key ways.
First, Crosschq gives you greater visibility and control of your employees. Our analytics offers unparalleled hiring insights, data, and supportive visualization at your fingertips. You can track Quality of Hire and employee performance to evaluate employees within your organization.
Second, Crosschq Assist offers a more supportive approach to layoffs. We can help your laid-off employees by guiding them through the next step of their careers. They can opt-in to our sourcing database, get connected to recruiters, and will have access to guidance throughout the entire Assist process.
Layoffs are challenging, but Crosschq Assist makes it easier by helping you demonstrate your commitment to all of your employees and investing in a positive workplace culture your employees will be proud to be a part of.
Click here to learn more about how Crosschq can help with employee layoffs today.
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