Are compassionate layoffs even possible?

Botched layoff announcements have blown up online with many of those meetings now conducted virtually and as more staff take to social media to publicize their experiences. 

Former CloudFlare employee Brittany Pietsch went viral earlier this month posting a nearly 10-minute long video of her layoff. In a Zoom call without her manager but just Pietsch and an HR representative, she learned she was losing her job for not meeting performance expectations. She pressed for further details that weren’t given. In other cases online, workers have reported logging into their work laptops to find they no longer have access, or they simply receive an email with the news.

Workplace experts say it doesn’t have to be like this, and there are more compassionate ways to tell staff about job losses. Doing so is crucial (to avoid bad PR) but even more so to ensure remaining employees don’t end up demoralized and resentful.

“Despite the fact that we live in a place where a lot of your workforce might be remote, it’s still very possible and doable to do this in as compassionate a way as possible,” said Jesse Meschuk, a senior advisor for Exequity with more than 20 years in consulting and human resources.

Layoffs can have a major long-term impact on remaining employees and company culture depending on how they are carried out. A recent analysis from Revelio Labs analyzed employees’ online reviews following layoffs at certain companies to gauge sentiments in the months afterward and found wide discrepancies.

“Despite the fact that we live in a place where a lot of your workforce might be remote, it's still very possible and doable to do this in as compassionate a way as possible."

Jesse Meschuk, a senior advisor for Exequity.

For example, one year after online car retailer Carvana issued mass layoffs, its employees rated the company 63% higher than at the time of the layoffs, according to that analysis. In contrast, Peloton saw employees’ overall ratings drop 22% by one year after its 2022 layoffs.

Across all companies examined, workers who survived layoffs rated their sentiments around their companies’ trajectory higher a year later, but sentiments around company culture and senior leadership never fully recovered overall. To be sure, the analysis didn’t dive into exactly how each company carried out its layoffs and why surviving employees fared so differently a year later, said Loujaina Abdelwahed, senior economist at Revelio Labs. 

But employers should take the following steps whenever possible to carry out layoffs in the least damaging way, experts say.

Communication and transparency

Delivering layoff news isn’t easy, but there are some things companies can do to communicate the news less brutally. For starters, employers could train managers and those in HR on how to have those hard conversations with both affected employees and those who will stay. For company-wide messaging, employers should always thoroughly communicate and emphasize to staff that they’ve exhausted all other cost-containment measures and this is truly a last resort, said Robin Erickson, vp of human capital at the Conference Board.

Often the CEO will come out with a statement addressing the broader picture and how hard of a decision it was, but employees want to hear more from them. “For employees who are impacted, it’s helpful to understand: how did we get here? What are the lessons that we learned? What are the changes we’re making in our business to try to avoid this happening in the future?” Meschuk said. 

“Those are really hard things to answer, but if you’re really trying to be thoughtful about how you move your organization forward, you should be communicating some of that,” he said. 

Make it as personal as possible

Pietsch’s viral TikTok video showed how impersonal some of these announcements can be, and handing the task over to HR or simply sending the news in an email is never the best practice.

“These should be discussions that happen one-on-one, face-to-face with your manager,” Meschuk said. “Make sure that you are doing this as personally as possible, you are directly impacting someone’s life, and it is a career they’ve likely put a lot of their life and time and attention into.”

Companies have turned to group Zoom meetings or email for mass layoff announcements to ensure staff receive the news at the same time, “but I think having the conversation face-to-face with a manager, even if it has to be over Zoom, is a great first step so that it just shows courtesy and intention to the employee,” he said.

Advanced notice and retention bonuses

In some cases companies may be able to give staff advanced notice of layoffs. For instance, a company integrating a new software that will replace the need for some staff could let those staff know a few months in advance, and they could provide retention bonuses to ensure those staff remain until their jobs are cut, Erickson said. That’s also possible during mergers and acquisitions when companies combine and some roles become redundant. Those staff should get retention bonuses to stay and finish up projects and help with the transition.

But for most mass layoffs and many recently, “they might have a pretty big shift that has happened due to the economy and their business and they have to respond right away,” Meschuk said. “So it might not be necessarily doable to provide really long notice like that.”

One round and done

After layoffs, remaining employees are often still anxious and unsure how many more rounds of job losses they can expect. Accordingly, condensing rounds of layoffs into one large, initial mass layoff is the best practice.

”The goal would be when you are in a difficult situation like this to make one move and try to be done with it,” Meschuk said. ”It can be really tough when it is just one round after another.”

Companies often break up layoff rounds quarterly and tie them to financial results, but employers need to “be really thoughtful not just about the next quarter or two quarters, but you know, what is the outlook for the business longer term,” he said.

“When an organization hires you, they're doing it because they believe you have some value to offer to the organization. But if that sentiment is expressed, that you're just lucky to have a job, then how valuable do you feel to an organization?”

Robin Erickson, vp of human capital at the Conference Board.

Supporting survivors

Layoffs, even when carried out thoughtfully, can still break the psychological contract between employers and their staff, resulting in lost trust and loyalty and declined morale. Caring for and engaging the remaining staff is crucial in the aftermath. It’s most important for managers and leaders to never express — either implicitly or explicitly — that surviving employees are “lucky to have a job,” Erickson said, as it often breeds resentment. 

“When an organization hires you, they’re doing it because they believe you have some value to offer to the organization. But if that sentiment is expressed, that you’re just lucky to have a job, then how valuable do you feel to an organization?” Erickson said.

Managers also must monitor new workloads for surviving employees and reset and communicate new expectations. “It’s not reasonable to expect that one person can do the work of two or three people after layoffs, because they’ll just get burned out and then leave,” she said. 

But ultimately, “one of the best ways to rebuild the psychological contract that gets broken during layoffs is for the remaining employees to know that the people being laid off were treated well,” added Erickson.