Feb 16, 2024 - Business

Employers are "afraid" to conduct layoffs in viral video era

Illustration of a person peering through closed window blinds which are colored pink and covered with the text of a termination notice.

Illustration: Annelise Capossela/Axios

As tech layoffs continue, more employers are worried about firings going viral in TikTok videos.

Why it matters: A little anxiety around conducting firings is a good thing — while cuts may be necessary for the bottom line or to appease shareholders, they also come with internal blowback and other hidden costs.

What they're saying: The videos have "come up with a lot of our clients, actually, they're afraid now to let people go," says Carly Holm, the CEO of Humani HR, a consulting firm that helps employers navigate layoffs.

  • The key to managing that fear: Don't botch the job.

How it works: Holm and her colleagues counsel employers to conduct firings as humanely as possible. She works out talking points with executives and urges them to stick to those parameters while also acting "like a human."

  • Considering that most humans operate without a bulleted list of things to say, that's a tough line to walk.
  • It's also important to talk to the workers who remain. Tell them why this happened, where the company is headed and explain the reasons for the cuts. And talk to them a lot.
  • "No doubt [layoffs] impact productivity in the short term. It's gonna be bumpy for a little bit," she says. "So over-communicating is key."

Plus: Holm advises executives to fire one person at a time. "We always recommend terminations are conducted one-on-one with HR present and ideally in person."

  • Those aren't the types of layoffs typically captured in viral videos, which often involve remote workers getting fired in a group.

The big picture: Layoffs — and the way they're handled — can impact a business's reputation and performance, for a while.

  • Employees struggle with anxiety and survivor guilt that hinder performance and reduce innovation, sometimes for years, write the authors of a 2022 piece in Harvard Business Review. They're particularly hard on businesses that rely on research and development and high growth.
  • Work quality might decline as workers try to amp up productivity with less support — the reputation hit makes it harder to attract the best people.
  • There's also legal risk. Failed media startup The Messenger, for example, is facing a lawsuit from former employees for not providing the legally required amount of warning time ahead of shutting down and letting staff go.

Zoom in: Employee engagement metrics those employee surveys that ask how confident and happy you are at work — drop off in the wake of job cuts.

  • Engagement only rebounds to pre-layoff levels at companies that start to hire again, per research from Culture Amp, a firm that conducts engagement surveys.
  • Even when they do start hiring, the comeback takes time. In new research shared with Axios, Culture Amp examined engagement metrics before and after layoffs conducted from 2020-2023 and found it takes at least 18-24 months to recover.

Emily's thought bubble: For years, I've been advised to write work emails as though they could appear on the front page of the newspaper.

  • Employers would be wise to conduct layoffs in the same way.
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