How Companies Should Communicate Layoffs

About four in five Americans worry about job security, according to a Global studyand there could be more layoffs as businesses grapple with economic uncertainty.

Why is this important: There is no easy way to communicate layoffs or cancel offers, but there is a wrong way – like mass zoom shots, harsh tweets Where leaked memos to the press.

Yes, but: Some companies have approached it with courtesy.

Rollback: In a 2020 intern Remark — which CEO Brian Chesky wrote himself — Airbnb announced it was laying off 25% of its employees. And this week, Shopify CEO Tobias Lütke sent a similar note about a 10% workforce reduction.

  • In my opinion, these communications have the right balance between information and heart.

Here’s what they did right:

  • Explain why. It sounds simple, but many companies fail to include a specific reason for layoffs.
    • The pandemic has forced Airbnb to “go back to basics” and put new initiatives on hold, while Shopify has grown too quickly to keep up with e-commerce spending – caused by the pandemic – which has since slowed.
  • Benefit-oriented. Chesky and Lütke have publicly shared available benefits — like severance pay and extended health care coverage — to show they care about those affected.
  • Discussed further. Airbnb management was clear on what to expect and dedicated 1:1 communication for those who were laid off. Chesky also hosted a Q&A with the CEO after all terminated employees were briefed.
  • Took possession. Both notes included words of thanks, but more importantly, the leaders took responsibility and offered a heartfelt apology.

What they say : Johnny C. Taylor Jr., president and CEO of the Society for Human Resource Management, recommends communicating with empathy and following these tactics:

  1. Host 1:1 meetings. Even if layoffs are announced in mass internal memos, 1:1 meetings with a manager or HR representative are a must.
  2. Have a script. Provide your managers with correct talking points and information regarding timing, benefits and outplacement services.
  3. Answer the questions. “Allow plenty of time, attention and space for questions — and if you get a question you don’t know the answer to, don’t guess,” Taylor said. Instead, say you’ll get the answer and respond within a specific time frame.
  4. Watch your tone. It’s not what you say, but how you say it. “More and more, breakup conversations are being recorded,” Taylor warns, so stick to the script but speak with compassion and sincerity.
  5. Keep records. Whether it’s follow-up questions, phone calls, or outplacement conversations, be sure to follow up on them.

The bottom line: Letting go of employees is one of the hardest things managers will ever have to do, but breaking the news in a clear, responsible, and dignified way is possible.

Editor’s note: This story has been corrected to include the correct name of the Society for Human Resource Management.

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