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Steps to Conduct Reductions in Force


April 3, 2020  |  Steve Cadigan


COVID-19 has brought large portions of the global and national economies to a screeching halt. Businesses are seeing slowdowns and the stock market has taken a dive the likes of which we have not seen since 1987’s Black Monday. State governments are encouraging employers to take advantage of work-sharing programs, and furlough rates are at an all time high; unfortunately, mass layoffs are still the inevitable reality of a recession.

If you are in HR and faced with the difficult task of conducting a large reduction in force (RIF), it is crucial that you do so with an abundance sensitivity and diligence in order to protect the employees being let go, those employees staying on, and your employer brand and workplace culture.

Please note that as of the spring 2020, the COVID-19 Pandemic has triggered such immediate and drastic changes to business operations that the federal and state governments have paused the duty to WARN employees of a mass layoff. Meaning, for the time being, employers are not required to supply employees 60 days advanced written notice of a mass layoff or a plant (or office) closing. This regulatory environment will change so please consult with counsel at the time of your layoff and/or visit the federal website: https://www.dol.gov/ and corresponding state agency websites for current guidelines.

How to Conduct a Proper RIF

As you plan to implement your staff reduction you need to be extremely well prepared. Hopefully no rumors have gotten out to distract the staff and you don’t have any pressure to move faster than you want to. If you have never conducted a RIF in your organization before, you need to make sure the key folks who need to be a part of this are fully clear on the timing and steps necessary to conduct this well. Uncoordinated teams and processes result in very bad outcomes. Avoid focusing too heavily on who is losing their job. Many leaders get consumed by the potential emotional reactions of those who are told they are losing their jobs that they lose sight of the big picture. It’s human nature to worry about the emotions of your colleagues, but remember everyone feels the impact, not just those who are going to be asked to leave. It’s critical in a RIF to not only think through how you will communicate this to the impacted employees but ALSO to those not impacted as they are staying in your organization and you need them focused, motivated, and moving forward as fast as possible.

When and where you communicate matters

Once you are on the eve of communicating to the impacted employees, make sure you think through the best day of the week and time of day to communicate. If you have many people impacted, and you have different geographical considerations and time zones, you want to aim for a time that you can do it all concurrently. That is not always feasible but you should aim for it because it keeps distractions and rumors to a minimum and it diminishes the time people may wonder – am I going to be terminated?

The setting where you give the news should be private. If you anticipate an adverse or highly reactive response, make sure you take measures to feel safe and include an extra person or have security nearby. Make sure you are ready and prepared and if you can practice the communication with another manager or leader who can help prepare you. Practice really helps here.

Notifying impacted staff remotely

In some situations you will find yourself in a place where in order to meet the communication coordination needs of the company you are simply not able to meet with some folks in person. Due to the recent global pandemic, COVID-19, some organizations are not allowed to meet with people in person due to guidance from the authorities. The best advice in these situations is to use your best judgement. How would you want it communicated to you that your job is being eliminated if you had to hear it via phone call or a video-communication? The more humane and the more care you take in delivering the news and giving the impacted an opportunity to respond, the more likely you are to have a better outcome. A recent news story featured a 100+ person customer service team that was all notified via Zoom at the same time that the department was closing. The people who set up the meeting had disabled the ability for attendees to comment or talk, which led to those impacted being extremely frustrated and having to watch many of their colleagues break into silent tears of shock. Think carefully if you have a large remote group – is there a way to make sub-groups or to have that be more intimate and think about the impact of disabling the ability for anyone to express anything.

Invest in helping impacted employees

How you treat employees during a RIF will speak directly to your workplace culture, so be aware of what is at stake. The choices you make during a RIF will leave an impression with employees forever, whether they are departing or staying with your organization. Remember, the people who are not asked to leave are watching what you are doing and recognizing this is how THEY will be treated if they are ever let go.

Your goal with the impacted employees is that they have as positive an experience transitioning out of the company as possible. You want the result to be that they work through their shock, anger, fear and reactions as fast as possible so they can focus on big decisions they were not expecting or intending on having to face such as living without a salary and having to find another job. Anything you can do to help them through their change curve and help equip them to find a new job quickly is really a worthwhile investment. From my perspective, it’s clearly worth considering investing in helping departing employees transition to another job. The whole idea behind a severance is to provide impacted staff some financial cushion to bridge them to a new opportunity. Consider offering severance in this situation as well as support to bridge them to a new opportunity

Second, ease the transition through a severance package, if possible. Showing the leadership team is humane and respects people goes a long way toward minimizing the negative and angry emotions that are inevitable with a RIF. Be consistent on how you apply your policy. If severance isn’t possible, do the work to bridge affected employees to a new role internally or externally. The goal is to help people move forward and minimize negative emotions. These
actions will lead to a smoother transition, and will ultimately lead to a more positive experience for employees.

Create an action plan and train to the plan

As you approach the notification date, make sure you have a comprehensive action plan and a crisp- clear timeline that addresses equipment, facilities, physical security, IT, and anything else. Make sure everyone is clear and is respecting the critical need for confidentiality and real time communication. Train managers and anyone else involved in the RIF so everyone is consistent with messaging. Some sage advice to keep in mind when conducting large RIFs: Never say “I know how you feel.”

Some key elements you need to think through is how long are you going to keep the notified people on payroll. Are you paying them two weeks in lieu of notice or are you paying them a two weeks notice over that period? When is their last day of employment? Are any of the impacted employees working on a work permit or visa and what timelines do those individuals face. Please note that many work visas (e.g., H1B, etc.) give workers a 60 day grace period upon termination to find a new job/employer sponsor. Therefore, the HR teams should give additional consideration and perhaps a transition period for workers on visas.

    • These are details that have to be proactively managed:
    • the timeline of all activities
    • who is responsible for each step
    • who is the problem solver when a situation goes off track
    • a clear communication plan
    • any necessary security procedures (see below for a few caveats)

When you actually implement the RIF, here are a few key guidelines:

Balance security with respect for the individual

Although you need to ensure the safety of your IP and secure your premises and property from theft and misuse, you don’t want to become fodder for workplace gossip and distraction because you had security escort people from the premises.

People affected by the RIF will continue to have relationships and influence employees in your workforce; show them humanity and respect on their way out. If you cut off system access immediately you may be signaling to the impacted employee a big lack of trust that may rub them the wrong way and may cause them to feel you are treating them harshly. Do your own security assessment to determine a process you feel protects everyone and sets the right tone but, having conducted 100s of reductions in force over my career, that treating people fairly and with respect in how you notify them and how you treat them afterwards has a long lasting impact.

Define and communicate a clear start and end to the RIF

When experiencing a RIF, there will be gossip and rumors flying around the organization. In order to contain and minimize the turmoil, it’s best to clearly identify the start and end point to the RIF. Let people know they are through the worst of it (if that is the case) and it’s time to start rebuilding the team. If you are in a period of uncertainty due to business climate or a global pandemic, be careful not to say things like “we are not going to let anymore people go”, or “no more staff will be let go” unless you are absolutely certain. You ruin trust and credibility if you promise not to let more people go and then you do.

You will likely be asked “Are there going to be more RIFs?”, so you should have a good answer prepared.

Be humane and respectful during a tough business cycle or global pandemic

It’s easy to be nice and respectful when business is booming. It’s a whole lot harder to be respectful when business is contracting and/or the business needs realignment. After the reduction is conducted, the main task is to regroup and motivate the remaining workforce. You need to be mindful that a RIF is a hugely destabilizing event for an organization and you should prepare to help people understand “why” and remind them of how hard this decision was to make and how careful you were to help impacted staff.

Acknowledge emotions and low morale

During a RIF, productivity goes down. People are afraid for their jobs and upset that friends and co-workers were laid off. They also may feel they now have more work on their plates or that they will have to work longer hours to cover the work of those who are let go. Be ready to talk about this – anticipate these feelings and questions. It’s inevitable that emotions run high and productivity runs low. Acknowledge it and connect with people. Plan for your business to need a bit of time to heal. Then, work hard at stabilizing the situation so people can focus on being a productive team again.

Give extra attention to top talent

When there’s a RIF and business is contracting, your top talent may start looking around for better opportunities. That’s why you need to give extra attention to your key players during a RIF and open the lines of communication so they express their fears and concerns about the organization and you have the opportunity to address them.

The last thing you want during a RIF is to experience a loss of your key talent while the business is contracting and productivity is down. Get in front of it and talk to high risk cases so you are at least aware they may leave and can start planning.

Conclusion

When a RIF is necessary, it’s important to consider all the relevant issues and execute the plan to rally and focus the troops on rebuilding the business. Spend time in the planning process and don’t get sloppy during execution. If you have someone on your leadership team who has been let go at some point in their past or who was a part of a RIF – ask them to share their lessons learned. It will be extremely helpful. Lastly, be sure to avoid these common mistakes which will destabilize the situation.

common mistakes when conducting a RIF


covid-19empathyemployee communication

Steve Cadigan

Steve Cadigan is a world renowned talent expert with over 30 years experience in the HR/Talent Industry. Work Steve has done at Cisco Systems and LinkedIn has been recognized by the Wall Street Journal and Fortune Magazine as world class. Today Steve is sought out by leaders & companies to help them build compelling talent solutions, he teaches and speaks at Universities and Conferences around the globe, and he sits on several Boards of Directors for innovative firms.



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