How to Lead When Working Through Layoffs

Workforce reductions have become commonplace as companies look for ways to decrease their costs and reallocate resources. In fact, BLS stats show that there were 1.7 million layoffs and discharges in December 2014. It’s not an easy process for all parties involved — the people leaving the job, the people still working and the managers who need to keep things moving forward. Layoffs send morale spiraling and many times they send employees heading for the door.

Most managers agree that layoffs are one of the most difficult workplace issues they deal with. In tech, with unemployment near 3 percent you may not think it’s something you need to be concerned with, but money problems happen to even the largest of tech companies and when they do you can be sure that laying off employees is an option they consider.

Pamela Rucker, co-chair for Women in Leadership at the CIO Executive Council (a sister company of CIO.com) details one of her experiences working as an outsourcer to a company that was going through debilitating layoffs:

“It was so bad that we knew that when we showed up at work and there were police cars parked in the front, that people were being laid off that day. We just didn’t know who would be going. Everyone’s nerves were raw, and it became increasingly difficult to stay focused at work.”

So what can you do as a manager to keep things on track and moving forward? Step 1 is to get as much information as you can before speaking to your people. You have to understand that your workers will have questions and although you may not be able to answer all of them either because you don’t know or can’t tell, you should have as much of the right information as possible to help quell rumors.

“I attempt to pause, to make sure I know what’s happening and why. I speak up in leadership meetings and ask questions where necessary, especially the ones I think my team will want answers to. Having all the right information before you start to talk about it is key, since you don’t want several different versions of the truth floating around that all contradict each other,” Rucker says.

Rumors and speculation are sure to be afoot so sharing as much as you can will help put much of that to rest. “When I was a senior leader during layoffs, I saw how that same feeling of being demoralized was threatening to derail the team. There were lots of rumors circulating about who might be let go, what types of packages might be given, what packages wouldn’t be given, and how tough the job market was in the city. It seemed to be all that people talked about,” says Rucker.

Be as Transparent as You Can

Experts agree that communication is paramount to allaying fears and keeping employees focused. “The first and most crucial action is open and honest communication with your team. In order to lead effectively you have to be trusted by your team. Share as much information as you can and allow your team to ask questions. This will stop the corporate rumor mill in its tracks and allow you to take control over the message that inevitably comes out regarding the layoffs,” says Matt Brosseau, CTO at IT staffing and recruiting firm Instant Alliance.

Once you are armed with the right information, it’s time to address your workers. According to Brosseau, you should meet with your entire team to discuss the issue. “Typically one, roundtable-style discussion the week following the layoffs should be enough,” says Brosseau. However, managers should expect follow-up questions and be prepared to meet with people one-on-one to discuss these.

Typical Questions

So what kind of questions can you expect? We asked our experts and they agree that the first questions is normally “Why?”. “You have to handle this one carefully,” says Brosseau, “It’s often best to talk about the long-term strategy of the company and the reinvestment of the cost from that department and how that will benefit the company as a whole.”

Here are some other typical questions as well how you should approach the answer, according to Rucker.

• Q: Are more layoffs coming? A: Tell the truth, if you know it and you’re able to share it.
• Q: Why did you pick that person? They were responsible for a lot, and now we have critical projects at risk. A: There’s no error-proof way to decide which member of the team you’ll lose. Even though you value everyone, and try to do your best to minimize impact, sometimes you will still see gaps when you have to let people go.
• Q: I heard that we could have saved money without doing layoffs. Why did we go this route? A: One of the challenges with the rumor mill is that it’s hard to talk about all the information you have and what led you to the decisions you made. While you can’t share everything you know, you can assure team members that you agonized over the best ways to make the cuts that you needed to make, and came to the conclusion that this was the best course of action.
• Q: I heard that we’re doing fine financially. Why are we laying off people? A: There are times when you’ve grown too much or too fast as an organization, and in order to keep the innovation you need in the marketplace, or in order to aggressively compete in the industry, you have to get lean. These types of layoffs aren’t so much about responding to bad times, as they are done to help you prepare for the good times you’re hoping to see down the road.

Keeping Employees Engaged

According to Rucker, instead of treating this situation as a “wait and see what happens” type of moment, IT leaders should be proactive. Consider how things will change and look for opportunities to reshape how things are done. “For me, this isn’t a time to sit back and wait for things to happen to us, but for us to look at how things will change, and what we’ll do to change with them. The process of change itself is a challenge, and can present many opportunities for you to talk about other things with your staff outside of the fallout from the layoff process.”

Maintain Focus on the Job at Hand

Keeping the talent you have can be difficult if employees are feeling unsure, underscoring the need for transparency. Once you’ve communicated all the data and answered all the questions you can, it’s time to get everyone on the same page. According to Chad Sheridan, CIO, Risk Management Agency, USDA, at this point managers need to keep the focus on the mission. “In the federal government space, people stay because they believe in the mission. Adversity and trials will always occur, but we can suffer through our trials if we believe that what we do matters, “he says.

Turnover Happens

Some of your remaining workers will understandably be wary and start looking for a job. However, if you are a good manager and treat your people as they wish to be treated, people will be far less inclined to leave. “Brain drain is a challenge during layoffs, because it’s your most talented people that can leave you tomorrow and go to your competitor, leaving you sweeping up the remains of a shattered team,” says Rucker.

Managers need to do their best to create great relationships with people before layoffs ever happen. “When you can make their experience at work more than just a money or role discussion, and grow them to the point where they feel that they are their best version of themselves when they work for you, they’ll fight to stay with you, and only leave when it’s absolutely necessary,” says Rucker.

One last tip that Rucker offers managers and workers who are working through this issue is what she refers to as PACE. This method can apply to many situations.

Pause – To figure out what happened and why

Be Authentic – “Understanding how employees feel and sharing with them in an authentic way goes a long way to spread goodwill even if you can’t always share good news,” she says.

Communicate – Be transparent and share as much as you can. “I can remember times when I could only have this conversation with my directs, but pulling them into my office and sharing with them was the difference between losing my top players, and finding myself left with a shell of my team,” says Rucker.

Engage – When layoffs happen your workers will be consumed with it initially, the workplace will be abuzz with discussion. Make yourself available; although you may not be able to do anything about it, sometimes listening is enough. “Being a leader that will allow them to talk about their fears without rigidly redirecting them to focus on their work, goes a long way towards building your brand. That’s important, because there’s life after the layoff, and you want to be successful in it,” says Rucker.

Final Thoughts

There will always be slighted feelings when dealing with a reduction in the workforce. That said, you’ve got to do your best to get out ahead of the problem, to focus on the people who are still there and your organization’s mission.