Mistakes some businesses make when downsizing

Mistakes some businesses make when downsizing

| Jun 13, 2018 | Business Law |

In the business world, downsizing is often code for “layoffs.” No one enjoys having to lay off employees, and the unpleasantness of the task can sometimes cause business personnel to act out of character. For instance, a normally friendly boss might be rigid, abrupt and even rude when telling employees they will longer work for the company.

The reality is that businesses can make a significant amount of errors, even legal errors, when they lay off employees. Here is a look at a few.

Not treating employees with dignity

With some companies, it seems like once they have made the decision to proceed with layoffs, they treat employees as numbers rather than as living and breathing people who hurt. Even if you need your employees to leave right away after you tell them that they are laid off, you can still handle the process with a modicum of dignity and respect. For instance, one strategy is to say, “We understand that the next few weeks are going to be hard. We do not expect you to come in and work for two more weeks. Take that time to care for yourself and to think about the next steps. Remember that you will get paid through X period, and we will help with references and your job search.”

Not consulting with a lawyer before proceeding

Layoffs, even the layoff of just one person or several, can be fraught with legal landmines. You want to be sure that you are not laying off someone for an illegal reason and that you handle the entire process in an aboveboard manner. In addition, you should avoid doing anything that conflicts with policies stated in an employment contract and the employee handbook (both of which should also have been vetted by a lawyer).

Not communicating with the folks who are left

The people who remain with the company after layoffs tend to have many concerns such as whether they are next or if the business is in trouble. You do not have to tell them everything, but it is good to at least acknowledge their anxiety. Maybe all you can do is say, “I do not know what comes next but hope to figure that out in the next week.” It is still better than remaining tight-lipped.