With economic headwinds, layoffs may be coming: What leaders can do to make them less painful

Originally published in the Globe & Mail June 10, 2022


Naomi Titleman Colla is founder of Collaborativity Inc., a Toronto-based consultancy focused on driving progressive talent strategy in this new world of work. She is also a co-founder of Future foHRward.

At last month’s Economic Outlook panel in Davos, a widely expected global recession was top of mind. As we continue to see volatility and uncertainty in our economic environment, many companies are grappling with what to do about their workforces. Despite it currently being a tight labour market, layoffs may be inevitable at some companies, compounding the pain felt through the pandemic through the loss of talent.

While layoffs are never easy, there are things leaders can do to make them less painful for all:

  1. Check your bias: be careful not to disproportionately lay off remote workers – In a recent New York Post article, Brian Kropp, chief of human resources research at the consulting firm Gartner, said that managers believe employees who work remotely are lower performers than those who come into the office, and will on average be more likely to lay off remote workers. He also pointed out a gender discrepancy. “Women work from home more frequently than men, “ he said, and “if companies axe employees based on whether employees work in-person, they therefore risk ending up with a male-dominated work force.” This is of course especially concerning on the back of the pandemic-induced “she-cession,” in which women have stepped back from their careers to take on a disproportionate amount of home responsibilities during periods of lockdown and home schooling. If workers have been hired as fully remote or have otherwise been granted the flexibility to work in this way, they should not be negatively affected as a result. Cutting corners by cutting remote workers first is a sure way to inadvertently let go of great talent. The answer shouldn’t be to get everyone back in the office, either. Instead, organizations should have clear guidelines to set up remote workers for success. This includes transparent communications detailing individual and leader responsibilities to ensure they aren’t “out of sight, out of mind,” as Mr. Kopp suggests. Leaders then need to clearly prioritize for their teams, regularly communicate performance expectations and assess progress, and in the unfortunate scenario of layoffs, use objective criteria.
  2. Pro-actively help people find a new gig – When preparing for layoffs, take time to have career conversations with those who are affected. You may discover employees who have hidden skills that would be useful in other areas of the business, which is a great opportunity to redeploy talent within the organization. In cases where that can’t be done, being transparent about layoffs can help workers find new positions elsewhere. For example, website Layoffs.FYI lists tech companies (and in some cases employee names) affected by layoffs since the start of the pandemic. While many of the companies listed are U.S.-based, companies that can accommodate workers based anywhere will be able to access broader talent pools. And thanks to social media like LinkedIn, employees and leaders can quickly communicate at scale that they are either open for hire or that they endorse those who are. I’ve seen great examples of leaders vouching for affected employees through posts on LinkedIn. Conversely, leaders looking to hire talent have also used this channel to offer interviews to workers who have been laid off.
  3. Tap into your human-centred leadership – human-centred leadership, simply put, is focusing on the people so they can take care of the business. On the flip side, business-centred leadership focuses first on financial metrics, and then on how people can help achieve them. Finding equilibrium between business-centred and human-centred leadership in tough situations like layoffs is a delicate balance. While layoffs are business-driven imperatives, leaning into human-centred leadership principles can make or break how people feel, react, and talk about your company on the way out. It is of course important to communicate the business reasons for the layoff, but it is equally important to treat people with respect, dignity and compassion through the process. Also pay attention to those remaining – survivors’ guilt can lead to disengagement and voluntary attrition, especially if they feel they are left with an unfair workload to bear.

As we face economic headwinds, many leaders will conduct layoffs for the first time in their career and most will be conducting them for the first time in a hybrid or fully remote setting. Supporting leaders with the tools and skills they need to lead through these challenging times in a human-centred way will mitigate bias and enable those who are affected to leave with dignity.