How Layoffs Affect 3 Types of Employees

Employees in different levels of an organization are all affected when a layoff occurs, but not in the same way. Just as every employee plays a different role in a healthy, productive company, they also play a different role, and act differently, in times of distress.

Leaders and Executives

Through thick and thin, leaders are there to guide the company in successfully planning and executing organizational goals.

During a layoff, supervisors and managers convene to discuss layoff alternatives, layoff criteria, who is going to be let go, layoff procedures, and the company’s turn-around plan. In short, their priority is to make sure the company, as a whole, survives this challenging period, even if it has to cut off one of its “arms.”

Because company executives are more concerned with big-picture thinking and long-term strategy, they don’t make decisions based on individual employees’ career path or welfare. So sometimes, in the name of profit, they lose sight of how their decisions might adversely impact the company. For instance, in times of layoff, negative PR, unemployment claims, and legal issues might come up and further damage the company if they’re not handled correctly.

A company’s leadership team can avoid this by working closely with their HR team, or a third party outplacement team, to take care of affected employees and any issues that might arise because of the layoff.

Affected Employees

Displaced employees have a varied range of job functions, seniority levels, and age groups. Some of them might have held supervisory roles.

A layoff puts affected employees in a serious predicament. On one hand, they have to scramble to find a new job before their last paycheck comes in, or whatever amount of notice the company gave them. On the other hand, they might be bitter, lost, and unsure of what to do with their lives.

An out-of-work 40-year-old will handle the situation differently from a young 20-something. Their age difference and job tenure will hugely affect how they will handle the situation. For example, a 40-something manager who has dedicated more than 10 years of their life to the same company will certainly feel a bit betrayed, and might be a huge risk for legal claims and negative press. You can’t blame them for feeling this way.

Whatever their age and tenure in your company, displaced employees often think their own needs outweigh whatever challenges the company is facing. When this happens, some of them might broadcast their personal opinions and rants on social media, and public websites for employees and job applicants, such as Glassdoor.

With outplacement services, affected employees can get career counseling, resume assistance, and job application assistance that they will need to land a new job faster. This can reduce their stress, and lessen the chance of publicly speaking out against the company.

HR Managers

HR managers feel as if the whole world rests on their shoulders during a layoff. Why? They’re the liaison between the executives and affected employees. They’re the company’s first point of contact for all recently displaced and ex-employees still in transition.

Aside from ensuring a smooth layoff experience for affected employees, making sure they’re taken care of and able to apply for new work, the HR manager is also responsible for demonstrating the results of the layoff. This includes tangible payroll savings and employer brand protection.

Wins and Losses

Yes, a layoff is a time of loss. But you can turn it into a win by demonstrating your company’s commitment, even to affected employees. It’s also a good test of your leadership team’s strength, commitment, and ability to plan for a better future.