During this period of corporate layoffs and reorganizing in this financial crisis, employers and employees must respect that there is a natural grieving period—a mourning for the way things used to be. Friendships may be severed, and there is day-to-day uncertainty about the future. An employer's psychological and emotional response does make a difference to the bottom line.
Companies use terms such as transformation or reconstruction when terminating people. While it is dehumanizing to be terminated, it is not the same as being fired. Being fired implies that the employee has failed the company or done something against policy. People today are being terminated because their jobs are being eliminated.
As Jack and Suzy Welch noted in their column titled, "Layoffs: HR's Moment of Truth," "Layoffs are when HR proves its mettle and its worth, demonstrating whether a company really cares about its people."
As I commented on their column, poorly handled layoffs lead to the poor morale of and performance by retained employees. Human resources departments are indeed valuable and set the tone upon entry into the business setting, and they're the last people one sees on the way out.
Bearing the Brunt
It is a difficult task at best when one department has thousands of people to terminate within a few days, not months. HR is usually understaffed and may be seen as unimportant. But the current crisis has put a new emotional load on this department, much like that on the floor traders at the New York Stock Exchange.
In recent days, we have seen men with heads in their hands, tears in their eyes, and reports of some traders literally collapsing from fatigue amid the hectic trading. We are getting reports from HR departments that their employees are suffering from fatigue, depression, and uncertainty regarding even their own employment.
It is their job to make the termination paperwork correct, have it prepared and ready for the day when management needs it. When there are a few terminations at a time, no sweat, but in today's situation some companies have needed to lay off more than 6,000 in a week. And they understand the numbers—fewer employees mean fewer HR staff will be needed.
Employers that are preparing to lose more than half of their staff at one time are finding it prudent for a team of managers to take on the role of exit interviewer. The idea is to have communication and let the employee know that he or she is still a person of worth.
A Soft Touch is Needed
We have learned that it is not so much who gives the news as how it is communicated. That may include offering something such as a packet to help former employees in job searches, providing support through community services, and perhaps most of all, a simple but heartfelt "thank you" for a job well done.
Why is that last point so important? Retained employees do hear about how their friends were treated on the way out the door. It sets the tone of how the company's reconstruction and transformation message is received. If employees feel they are valued even in a situation such as downsizing, fear and gossip is often mitigated. This equates to more productivity and a better fiscal bottom line. Everybody wins.
Understandably, businesses must find ways to cut expenses without cutting services where possible. That often means terminating employees or selling or canceling leases on buildings no longer needed. A corporate manager I know recalls seeing on the local news her company's name removed from buildings and people leaving the premises to face unemployment. Depression quickly overcame her entire division.
Beyond Survivor's Guilt
Employees grappling with layoffs don't just feel guilty for having survived the latest round of cuts. They're also telling their colleagues and loved ones, "I don't know how to react anymore." Keeping up morale is a challenge that goes beyond HR, as everyone, from the CEO on down, is made to withstand varying levels of pressure and different challenges.
With each round of terminations, many employees go through bouts of depression on the job and away from it. Families are facing severe challenges paying for the necessities of day-to-day life. We know from health experts that these emotional ups and downs can create physical and mental imbalances. The bottom line: increased health issues and insurance claims.
One hopes entrepreneurial inspiration will eventually lead us out of this mess, and that in the meantime we will offer each other a hand of friendship, both between employer and employee and neighbor to neighbor.
In these tough times, ascribing blame or feeling guilt doesn't solve problems, and the caring you extend may make all the difference to yourself and others.