Fear and frustration: managing layoffs in times of uncertainty

IN Partnership with

Amid widespread retrenchment and employee anxiety, HR leaders need to act decisively but compassionately

WITH LAYOFFS seemingly a daily occurrence now, employers are having to work extra hard to manage the mental well-being of their people. And while leaders never want to be in the position of letting a worker go, in economically uncertain times, it’s often a sad reality. For HR practitioners, it’s a question of how best to safeguard the psychological health of both the people you’re letting go and their colleagues left behind – while also balancing C-suite expectations. “While the crest of Canadian layoffs from 2022 slowly began to fall this spring, it’s far from over,” says Meghan Stettler, director of the O.C. Tanner Institute. “Each new layoff announcement puts mounting pressure on HR managers to deliver two seemingly opposing outcomes: reconciling market realities while preserving culture and the employee experience. “Even though the pandemic presented a variety of new and inescapable difficulties, the reality is that managing layoffs has always been a critical job function of HR – albeit an unwelcome one – and one that each HR manager may be forced to handle more than once in their career. We’re up against a moment in time when traditional change management has hit a wall, and the top-down and overprocessed approach is leaving employees fearful and frustrated.”

O.C. Tanner is the global leader in software and services that improve workplace culture through a wide variety of meaningful employee experiences. Our Culture Cloud™ is a suite of apps and integrations for recognition, team initiatives, well-being, and leadership that help shape thriving cultures. We connect people to purpose, accomplishment, and one another at thousands of the world’s most respected companies. The O.C. Tanner Institute is a widely respected research and education team. Our award-winning and peer-reviewed research on corporate culture, employee recognition, leadership, and well-being empowers organizations to intentionally create healthy, productive workplace cultures by design. Visit octanner.com for more information.

Find out more

“We’re up against a moment in time when traditional change management has hit a wall, and the top-down and overprocessed approach is leaving employees fearful and frustrated”

Meghan Stettler, director, O.C. Tanner Institute

Fortunately, new research from O.C. Tanner reveals the best practices for navigating organizational change with a people-centred approach that leads to less attrition, more optimism, and better well-being outcomes. And, for leaders looking to navigate these difficult times and improve their own practices, The O.C. Tanner Institute is hosting its Influence Greatness Conference from September 12–14, 2023, in Snowbird, UT. At this event, O.C. Tanner will unveil new findings on organizational change and the state of employee experience in global workplaces – specifically looking at how layoffs and survivor syndrome are hurting morale. This new data can’t come soon enough. According to research from Leadership IQ, 74 percent of employees who

didn’t lose their jobs during layoffs believe that their own productivity has declined in the days since, with 64 percent adding that the quality of their companies’ overall mission and service was also diminished. For employers, it’s important to remember that you’re not just safeguarding the mental well-being of laid-off employees – the incident has the capacity to derail all your people.

A lesser-known component of layoffs is the impact they have on the employees left behind. Seeing their colleagues and friends lose their jobs can be emotionally taxing – leading to a rise in survivor syndrome. “The massive layoffs and furloughs of 2020 left employees grappling with survivors’ guilt, a loss of trust, and anxiety,” says Stettler. “Unfortunately, those trends haven’t changed much in three years. This is because organizations are still gatekeeping and controlling vital information at the exact moment they should be increasing transparency, championing employee voice, and providing career-transition support. Our research is clear – employees are adults who do not want to be treated like children.”

In a 2020 focus group hosted by the O.C. Tanner Institute, one attendee revealed the anxiety they felt in the leadup to layoffs. A lack of clear communication from their organization led to a decline in mental well-being – something that could be avoided by practicing transparency. “I don’t feel lucky – I’m too on edge,” they said. “I just want to know what … to plan for. Yeah, it will suck to lose my job, but I’d rather know beforehand that it would be a possibility than [suddenly] to find it out one morning.” “The implications of failing to navigate organizational change successfully are quite substantial,” adds Stettler, “including a significant drop in the odds of trust, a 79 percent decrease in the odds of employees saying they want to be working at their organization a year from now, as well as a 66 percent decline in well-being scores.”

“I don’t feel lucky — I’m too on edge. I just want to know what … to plan for. Yeah, it will suck to lose my job, but I’d rather know beforehand that it would be a possibility than [suddenly] to find it out one morning”

focus group participant

Layoffs must be handled with compassion and the employee experience top of mind – with the odd dash of technology. While layoffs should remain inherently human-centric, HR tools do have their own role to play here. For example, as Stettler tells HRD, organizations that educate, facilitate holistic recognition, and embed the tools and technology solutions that can facilitate broad participation and effectiveness will be able to proactively celebrate the small efforts and major accomplishments through change. “Imagine how morale would turn if an employee expressed their thoughts in a change-focused meeting, and the organization or leader recognized how their perspective helped shape better outcomes?” says Stettler. “Imagine if an organization or senior leader recognized a manager for how they were handling change and guiding their team in effective ways that reinforced their values? “Particularly in times of change and challenge, employees want to know what success looks like, and recognition can be an effective tool to let people know what is valued in the organization, and that who they are and what they contribute really matter. It’s no wonder, then, that 92 percent of employees at organizations with integrated recognition believe change to be positive.”

So, what can be done to mitigate the damage? As with most things in HR, it all comes down to strategy mixed with empathy. A participant in a recent focus group shared how her organization went above and beyond – maintaining culture while preparing employees for layoffs by communicating transparently, as well as providing resume support and tailored networking experiences.

Navigating survivor syndrome

Leveraging technology to ease the burden

Published 07 Aug 2023

ASIA

News

SPECIALIzATION

Events

Best in HR

Resources

Companies People Newsletter

About us Authors Privacy Policy Conditions of use Contact us RSS

News

Specialization

EVents

Best in HR

Resources

ASIA

Companies People Newsletter

About us Authors Privacy Policy Conditions of use Contact us RSS

News

Specialization

EVents

Best in HR

Resources

ASIA

About us Authors Privacy Policy Conditions of use Contact us RSS

Companies People Newsletter

Future-proofing your culture to weather layoff anxiety

Employees who had a positive experience with change...

...Were 5x more likely to see themselves working at the organization in one year and 3x more likely to say they planned to be with the organization three more years

Experienced far less burnout (-78%) and anxiety (-39%)

“Having access to that … is huge because … you don’t go into a depression – I mean like a tailspin – and become unproductive, when you’re just trying to gather your thoughts,” they said. “It gives you structure if you have a place to go … If [they] would have told me a week before, I’d be ready to leave. That’s upsetting.” Stettler reveals three key components that HR leaders should be focusing on in times of crisis – support, elevating employee voice, and communication. 1. Support leaders Currently, only 27 percent of leaders said they feel strongly prepared to help their people navigate change, but employees who perceive that their leaders have the tools to help manage change are 10 times more likely to feel a strong sense of trust in their workplace. “For this, we conducted a first-of-its-kind experiment on leader communication,” says Settler. “We learned that positive outcomes continue to rise as the level of information shared increases. For instance, when leaders shared what they knew, the level of trust and desire to stay among employees increased.” 2. Elevate employees’ voices to help process change “The second half of the experiment mentioned above revealed that when employees are given an opportunity to express their thoughts across surveys, townhalls, focus groups, and in one-to-ones with their leader, they’re 1,284 percent more likely to have a positive change experience.” 3. Effective communication Clear, early, and frequent communication is an empathetic expression of trust and empowerment. Moreover, when employees feel like it’s also honest, their perception that the organization cares about them increases tenfold. “Employees at people-centric organizations are 12 times more likely to say their experiences with change were well-managed,” adds Stettler. “The future of managing change, including layoffs, must be people-centred.”

“When an organization conducted a layoff or furlough, we saw a 57% increase in disengagement”

If you want to glean more strategies on how to deal with layoffs empathetically, register for O.C Tanner’s Influence Greatness 2023 Conference from September 12–14, 2023, in Snowbird, UT, or the IG23 virtual conference, airing on October 5, 2023 with on-demand content.

focus group participant

Future-proofing your culture to weather layoff anxiety

IN Partnership with

“When an organization conducted a layoff or furlough, we saw a 57% increase in disengagement”