During the 2008 market crisis, Robert Reck led layoffs for a publicly traded manufacturing firm. He describes the experience as “one of the most gut-wrenching” of his career.

“The jobs hanging in the balance weren’t simply names on a spreadsheet for me,” he says. “The list of names included both friends and parents of friends.”

Making layoffs is tough for any company, but there are alternative solutions worth considering. This article covers the available schemes from the UK Government to protect businesses and their employees, and – if redundancies cannot be avoided – the best ways to handle the process and communicate to your employees.

Explore all your options first

If you’re struggling to find work for your employees, the Coronavirus Job Retention Scheme could offer a lifeline. The scheme allows you to furlough your staff, or put them on leave, with the Government covering as much as 80% of an employee’s wages. This means you can at least retain your staff through the pandemic and reassess the situation as business resumes.

Other Government support measures include the ability to defer your VAT payments until the end of June; business rates relief and also grant funding schemes for small businesses and those in the retail, hospitality, and leisure industries.

Outside of Government support, there are other options you can consider to avoid layoffs. For example, you could reduce hours and pay, redeploy staff to other departments, encourage employees to use annual leave or take an unpaid sabbatical, or reduce pay and benefits. While these options might not be ideal, it’s worth discussing them with each of your employees and working together to find a solution that works for you both.

How to handle layoffs

Unfortunately, it is not always possible to prevent layoffs. If your organisation is facing this situation, there are steps you can take to make a difficult process as personal and compassionate as possible.

1. Start with compassion

Reck, now the principle of recruitment firm Kilbourn Marshall, encourages leaders to begin any workforce reduction initiative by thinking about the people on the other end of your decisions. You’re in the driver’s seat of a tough process, but compassion helps you navigate with heart.

“Visualise having your position eliminated as a reminder that you have the power to avoid making this feel like a sterile process,” he says. “I know unemotional executives who have recommended delivering [layoff] news via email or phone even before social distancing guidelines were in place. That approach lacks the compassion and respect your departing teammates deserve.”

Compassion means remembering, every step of the way, that your words and actions affect real people with complex lives. When you navigate layoffs with compassion, your communications strategy will ultimately be enhanced.

2. Establish clear communications

The people affected by your decisions will help guide your messaging. Leaders should adopt a proactive communication strategy for any workforce reductions, Reck advises.

“Be transparent and communicate to your team as early as possible that cuts will be coming so employees have the ability to brace themselves,” he says.

This could look like all-hands virtual meetings where leaders discuss previous plans, actions the company has taken to avoid layoffs and the factors that led to the decision to use layoffs. The forum chosen should offer employees the chance to ask questions about the company’s process and proposed timelines for re-hiring. Then, employees should be given a hard date for when cuts will be made – don't spread the cuts out over several days; it can cause greater disruption than a single decisive day.

“Ripping the bandage off by getting the layoffs done all at once so that fear and anxiety don’t continue to run rampant will be viewed as compassionate by the employees who survive the cut,” Reck says.

3. Prepare your leaders

Even with a compassionate mind and solid communication strategy, leaders must prepare for a complex administrative and emotional process.

“Leaders focus on the day they'll let people know about layoffs and ignore the aftermath," says Lucy Chung, CEO and co-founder of NOBL, an organisational design firm that helps companies rethink their cultures. "The ‘day of’ comes with so much anxiety and logistics that it's easy to get caught up. It takes intent and discipline, instead, to focus on the next steps.”

Chung recommends that organisations think about how they are equipping leaders to field questions about layoffs. A shared document with a running list of employee questions and leadership responses can be a powerful tool in helping leaders provide a consistent response across the organisation. Also, organisations should create strategies early on in the layoff process to update their organisational design (such as documents that outline roles, responsibilities, workflows and reporting structures).

4. Embrace the unknown

For all the planning organisations do to establish clear communication and processes around workforce reductions, an element of the unknown will always persist. While you can control an organisation chart, you can’t control people’s responses to the layoff process.

“Employees will process layoffs in different ways," says Chung. "Some may get angry and yell. Others will quietly accept the news but need to talk it out later with colleagues.”

Instead of trying to control their reactions, Chung recommends leaders use scenario planning to identify potential outcomes. Leaders can then work through different responses in advance instead of being blindsided at the moment.

“Practise the layoff conversation, in front of a mirror, with a partner or by recording it,” she says.

Appearing ill-prepared can make leaders appear less competent in a time when they need to be perceived as both competent and compassionate.

5. Nurture your outgoing and continuing workforce

Layoffs split your workforce into those outgoing and those remaining. Reck wants companies to think about crafting a landing pad for those departing.

“The biggest things [employees] need from you are stellar references and for you to reach out to your professional network to help them land softly,” he says.

Employers should consider exploring resources that will offer employees ongoing support. Perhaps it’s an alumni network or letter of reference program. It could be an outsourced firm that handles benefits questions so employees don’t feel abandoned. There are always ways to let laid-off employees know that their service remains valued.

For your remaining workforce, it’s not necessarily going to be business as usual. They’ll need attention and compassion following such a tumultuous time in their tenure.

“After layoffs, follow up with the rest of your employees to share your vision for the future of the company and their role in it,” says Chung. “Hold smaller meetings to address questions as the situation develops, and be understanding if teams are not as productive. It can take up to a year for cultures to return to a ‘new normal.’”