Wednesday, September 14, 2011

How Layoffs Reveal Your Leadership Qualities

I just received an email with the subject line ‘Checklist for Terminating an Employee’. It turned out to be an advertisement for a book called From Hello to Goodbye. For some reason, although the book is about the entire work span of an employee, the only chapter that was mentioned in the message was the one on how to “terminate the employment relationship”.

This how-to chapter was the sole selling point for the entire book. The email came from the Society for Human Resource Management, so it is intended for HR professionals.

Although I’ve never been “fired” per se (although one insensitive career counselor moved a colleague to tears when she told our group of newly separated workers that being laid off was the same thing as being fired), I have been laid off several times and each time the process was handled very differently. No matter how Human Resources, legal departments or senior management define the termination process, the ultimate responsibility for how the separation is actually handled rests with the worker’s manager.

The coldest, most impersonal layoff I experienced was probably done according to the above-mentioned Checklist. My boss had been distant for some time. When he called me into his office where another manager was sitting, I immediately knew this was it. It offended me that he felt he had to have a witness. Without any emotion, he said he’d decided to outsource my position, explained my severance package, and asked that I pack my things and leave that afternoon. This was the least sensitive layoff I’d experienced, and the one done most “by the book”. My boss was Vice-President of Human Resources.

The most humane termination experience I had was the time my boss defied the HR rules. My supervisor rounded up our team of four and said, “I’m not supposed to tell you this, and you can’t tell anyone else. But lay-offs are going to happen next week and all of you are among them.” She then took us out to lunch and gave us the rest of the day off to “go sign up at the unemployment office”. It was a Friday and on Tuesday of the next week, dozens of people were called into a large room and told en masse that their jobs were eliminated. Stunned co-workers wandered the halls, but gratefully, we weren’t among them.

In the second example, some will say my boss acted rashly and laid the company open to possible lawsuits by doing what she did. But my opinion was she was a very smart leader. First, she knew us well and knew that getting laid off would be a hardship for us. She wanted to give us the news in as helpful and human a way as possible. She showed empathy and concern.

Second, studies have shown that ensuring the dignity of terminated workers goes a long way toward heading off lawsuits. One study of displaced employees found that 15 percent of workers who felt their severance experience lacked dignity or respect had filed wrongful termination lawsuits.

Honesty, sensitivity and caring for an individual help mitigate the devastation of layoffs. As a leader, you must take care to make clear, fair and informed choices about which employees to let go and which to keep. By being transparent about how the decisions are made, and making an effort to over-communicate the what, why, and how of the layoffs, you are showing your employees respect.

One study reported that losing one’s job created more stress than a divorce. It doesn’t matter which euphemism is used – downsizing, rightsizing, workforce reduction, delayering, made redundant, releasing, and on and on – if you are laying people off, you are the instigator of perhaps one of the biggest stressors of your employee’s life. That’s a lot of weight to carry.

When feeling stressed, it’s common to make more errors and to react emotionally. If you serve as an example of calmness and empathy during challenging times you can help spread that behavior. The worst situations are an opportunity to reveal the best in you.

Unemployment is still high and the news in the last week reminds us that cutbacks are continuing. Unfortunately employee layoffs are one of the primary management tools used to increase efficiency and reduce expenses. Bank of America announced over 30,000 layoffs in the coming year. You just need to check Daily Job Cuts or the BLS site Mass Layoff Statistics to see the gloomy updates.

It’s not easy to be the one to communicate a termination or to be among those left behind. By choosing behaviors that show respect and caring, especially when times are very difficult, you have an opportunity to illustrate true leadership qualities.

“At the heart of leadership is caring. Without caring, leadership has no purpose.”
– James Kouzes and Barry Posner, Encouraging the Heart

A new euphemism: "We have to synergize backward overflow."

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