The complexities of a redundancy

When we hear the word 'redundancy' we often respond in an emotional way. We’re immediately concerned about the employees who were let go—employees who are sometimes our friends. And compassionate questions race through our minds. When will they find another job? What is the job market like? Will their family be financially secure? 

We also consider the company making the redundancy, sometimes our own employer. And while there may be a degree of compassion for the company, it’s usually overshadowed by mixed feelings, from frustration to scepticism to concern. Is the company ok financially? Do they really need to cut costs by letting go of people? Will they make more redundancies?

Redundancies trigger a palpable sense of angst, every time, even for those with the difficult job of making them.

While economists and business leaders might predict redundancies, when they happen and who is affect is often unexpected and anything but simple. There are many factors to consider, steps to take, and people to engage. Let’s take a look at some of the most inevitable complexities that companies face when letting go of employees, broken down by department (plus outplacement services).

Human Resources

The HR team play a central role in managing redundancies and while there are dozens of issues to consider here, we’ll focus on two: communication and retention.

Communication

It must be consistent, unwavering from leadership’s agreed upon messaging. If that message is one of specific reason, gratitude, and sympathy, then it should be expressed in the same manner, from the top down, throughout the process. Inconsistent messaging can cause anger and distrust among employees, the last thing any company needs during such a trying time.

Retention – Keep in mind that it’s generally much more expensive to find a new employee than it is to keep an employee. During a redundancy, remaining employees can be offered chances to speak with leadership, their bosses, and even outside counsellors. It’s also increasingly common to offer them opportunities for skills development and a rebalance of their workloads. HR should devote as much time to their current workforce as they have to those at risk of redundancy, re-instilling a strong sense of confidence and camaraderie.

Legal

It is not uncommon for employees at risk of redundancy to threaten legal action, especially at a time when emotions and uncertainty run high. Outplacement can help alleviate the risk of redundancy as employees respond positively to outplacement support and that outplacement services can help those with access to them find a new job faster compared to those without career transition support. 

Public Relations

Sometimes, for any company of significant stature in its community or industry, local and potentially national media will come calling. Again, while there are many considerations, we want to focus on a few: the announcement and the reason.

The Announcement

It’s debatable whether a company should even announce a redundancy to the media. On one hand, why give them the option to shine a negative spotlight? On the other hand, why not be open and honest with all parties, including the media? This often comes down to history, reputation, and other factors such as the reason for the redundancy. In general though, if there’s a clear and justified reason, along with an objective degree of sympathy for those who were made redundant, media relations shouldn’t be an issue.

The Reason

As we just mentioned, the reason for a redundancy should be clear and justified, as they usually are. If it’s a cost-cutting response to a recession, say that. If it’s because of an acquisition and shift in direction, explain that. Be thorough and transparent to the media. If a reason is ambiguous, it could be an open door for a painful interrogation or even a tarnished reputation.

Outplacement Services

Outplacement services come in different degrees, so what exactly are companies offering? In short, career guidance. That can mean actual career coaches. It can also mean interview training, resume writing lessons, and even development and learning to facilitate career changes. Regardless of the level of outplacement services offered, it’s an increasingly common way, almost an expected way, of taking care of former employees and managing a reputation to attract future employees.

While we only scratched the surface of the complexities here, we did cover some of the more pressing ones. If or when your company experiences a layoff, go in knowing the complexities. Embrace them. Because the most dangerous thing is to overlook them and not tend to them.

Read the other blogs in this series

The Uncomfortable Inevitability of redundancies

The psychological toll of a redundancy and the light at the end of the tunnel