EMPLOYEE LAY-OFF

When an employer calls us to talk about a possible lay-off, one of their first questions is: "How do I tell my employees?" The plain fact is -- the employees probably saw it coming before the boss did. The employees see the company is serving fewer and fewer customers; shelves don’t need re-stocking as often -- the first hint the boss had was declining sales figures on the weekly or monthly reports.

Unless you have a union, seniority should be the LAST factor that goes into the lay-off decision. Lay-offs in a union-free workplace are based on employee performance, not seniority. There won't be many "tie ratings" if managers and supervisors have been doing appraisals correctly..

Before handing employees their walking papers, take a minute to thoroughly check into how lay-offs are conducted in your workplace. It is important to avoid any hint or perception of discrimination, but consider what more and more employers are finding -- productivity among the remaining staff typically goes down after a lay-off.

1.Review and re-check the Performance Appraisals. If this essential supervisory duty has not been done properly, regularly, your supervisors and mid-level managers have not been earning their pay. Some of the layoffs may need to start at this level of management.

2. Stay ahead of the office "grapevine" and the bamboo-telegraph. Never let employees learn about a lay-off through the rumor mill. Prepare all employees when a lay-off is imminent; tell the people who will be laid-off as soon as the decisions are made.

3. Add a personal touch. Layoffs should be announced in person by the CEO (not a manager, a supervisor or an HR functionary). No memos, no voice mail or e-mail. Give full details -- take the time to clarify a severance package, if there is one...and there should be one.

4. Knock off the chitchat. When laying-off employees, get right to the point and keep the meeting short.

4. Be honest. Don’t try to sugarcoat the situation. While termination is mostly permanent. Lay-off can be temporary, indefinite or permanent.

5. One company terminated a 55-year old employee as part of a layoff. He filed a lawsuit. At that point, the company changed its reason for terminating him from “job elimination” to "performance problems" and "policy violations".

The court said: Giving inconsistent reasons for termination could lead a jury to believe that age discrimination was at play. There was no documentation that referred to poor performance, and written reports* covering a conversation between two people involved in the termination included the words "cover up" and "age discrimination."

6. Listen to what employees have to say. If they can’t "vent" to you, they may decide to complain to a government agency, a lawyer (or a union) instead. But retain control of the conversation at all times.

7. Allow laid-off employees to leave with dignity. Do not have them escorted off company premises -- but do not allow them to linger for days or weeks as they clean out their workstations and look for new jobs. Engage an outside agency to help with "outplacement". On that final day, offer to stay late so employees can pack their things after colleagues have left.

8. Don’t forget about the "survivors." The way you treat laid-off employees will be observed by those who remain -- they will be wondering if they are next. Keep them informed about the circumstances that made lay-offs necessary. If you are unsure whether more lay-offs are coming, let them know that too.

* remember Bill Gibson's  rule: "If it isn’t written down, it never happened."

THE EMPLOYERS COUNCIL conducts Performance Appraisal training because too many managers and supervisors do not know how the basics of rating performance correctly and fairly. They tend to rate all employees as "above average" -- not "excellent or outstanding" (because some companies requires a written justification for high ratings. This a good policy -- but lazy raters will subvert the system by rating "average" to avoid writing a memo).

If you require a 250-300-word memo for each performance appraisal and you will quickly discover (1) who your best and worst employees are; and which of your managers and supervisory need to learn how to write an appraisal.