By: Dianne Shaddock Easy Small Business HR. All rights reserved.

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1 Major Mistakes Businesses Make When Laying Off Employees, Part II By: Dianne Shaddock

2 Part II - Major Mistakes Businesses Make When Laying Off Workers: Employee and Business Impact Special Report From: EasySmallBusinessHR.com In Major Mistakes Businesses Make When Laying Off Workers, I highlighted several layoff horror stories and why it is best to proceed with laying off employees in a way that is thoughtful and respectful of the affected employee. The laid off employee is not the only person negatively affected by your decision. Layoffs have a significant impact on your current employees and very likely your business, at least for the short term. How soon you recover from the fallout will depend on how you approach the layoff process. Impact On Laid Off Employee Losing one s job is one of the most stressful experiences a person can endure. It is not uncommon for employees to go through stages of denial, anger, betrayal, and depression when losing their jobs; even when the employee understands the reasons for the layoff. Interestingly enough, there are also those employees who are relieved that their jobs have ended! 1

3 Impact On Those Left Behind The stress isn t reserved for those who have been laid off. Some of your employees may also be angry, confrontational, or withdrawn. Others will either start looking for other employment, or question your actions. Most will be afraid that they are next in line to receive their walking papers. This is not the time to stay behind closed doors. Have a communication plan in place for employees. Call a group meeting or meet with staff one on one to let them know the reasons for the layoffs. Make sure that you allow time for your staff to communicate their concerns and ask questions. The Negative Consequences For Your Business Don t forget that your laid off employees as well as those workers that remain in the workplace are the mouthpiece for your business. Your staff can be your best word of mouth advertising, or your worst nightmare. When you don t treat your employees with respect and dignity; especially during difficult times, they won t be shy about letting others know about how they were treated or, how their co-workers were treated. Their displeasure can be far reaching and viral as work related issues are often shared with their network of family and friends. Social networking sites such as My Space as well as blogs and other forums are popular avenues for current employees to bad 2

4 mouth: their employer and there is very little that you can do to stop them. Ways To Lessen Negative Impact You can lessen the impact of being laid of for your workers by giving them as much advance notice whenever possible that their job will be ending. Granted, advance notice may not always be the best approach based on your businesses needs and concerns but it is the ideal and sensitive approach. Treat the employee in an empathetic and respectful manner. Sit down with your employee and briefly summarize the business reason for the layoff. Be prepared to give them a memo that briefly outlines what happens next along with a packet that contains information on: Their last day of work, (even if it is the same day). The amount of money owed to the employee Be prepared to give the employee their last paycheck if it is there last day if possible. (Some states may require this so check with your states Department of Labor). If the employee has benefits, a summary of when those benefits end and who to contact with questions. Let them know that the decision to lay them off was a difficult one. Make sure that you, or a designated staff member is available to answer any questions once they have had a chance to digest the information. 3

5 If the employee is being laid off at some future date and is being given advanced notice, let them know that you will be flexible if they need to go on job interviews during the notice period. Proceeding respectfully and being transparent during a difficult time, will help make the transition easier for everyone involved. Need More Employee Hiring and Managing Tips? Get Timely Free Advice on: How to Find the Best Employees Manage Difficult Staff Fire Problem Employees Develop Employee Policies and Procedures and so much more! You ll also get my FREE 6 page report: Giving Your Employees What They Really Want 4