Layoffs are bad enough, let alone during the holidays. What decent person enjoys depriving people and their families of a livelihood before Christmas?
Unfortunately, it still happens – and quite a few companies often go about it wrong. Yes, I’m talking about Better.com’s CEO who fired 900 employees over Zoom, right before the holidays. Yikes.
To say that the move was a PR disaster is an understatement. In less than a week, three of the organisation’s top executives resigned. Unsurprisingly, the CEO is receiving so much backlash all over the internet for the cold, cruel, and disastrously ill-timed mass layoff.
This brings us to the question: Are holiday layoffs really necessary? Or can you postpone them until at least after the festivities?
Let’s take a look.
Why Companies Lay Off Employees During Holidays
Layoffs are inevitable for most companies. Business cycles are impersonal and results-oriented. When the numbers are down, many leaders have no choice but to fire employees to cut down on costs. Otherwise, the business would have to close down. That’s the cold, hard truth.
However, the question isn’t really about whether layoffs are necessary. Most employees actually understand why it needs to be done. The issue here is the timing.
Besides, according to HR experts, holiday layoffs actually do more harm than good for the following reasons:
It’s Not Always The Answer
Contrary to most claims, layoffs don’t necessarily resolve a company’s financial crisis, at least not immediately. In fact, according to an expert from the Wharton’s Center for Human Resources, there’s no evidence that layoffs actually help improve financial performance – except during a recession.
So, if you’re just trying to cut costs during normal circumstances, then layoffs are clearly not the answer. Furthermore, you could end up demoralising the people left behind and inadvertently cause a mass resignation among your key staff if you carry out unnecessary terminations.
And speaking of mass resignations….
Holiday Layoffs Can Create An Atmosphere of Fear and Uncertainty
It’s not just the laid off employees you should be worried about.
Often, the employees left behind experience survivor’s guilt for dodging the bullet. Besides, what would stop them from thinking they might be next?
And when employees don’t feel secure, they’ll be compelled to take their talents elsewhere.
Even Lower Morale
People’s emotions are usually heightened during the holiday season. Everything just feels more intense.
Hence, HR consultants advise waiting until after Christmas before initiating layoffs. Sure, it’ll still be a bitter pill to swallow, but at least everyone still gets to enjoy their holidays.
Who knows, things might get better for your company right before the year ends, right?
If You Can’t Avoid Laying Off People During the Holidays, Do It Right
Much as we wouldn’t want to retrench people, sometimes, it might be the only choice. If it comes down to laying off a few to keep the company operating and the majority of workers employed, for instance, then a layoff is probably unavoidable.
But there’s no excuse for botching it as badly as Better’s CEO did.
As much as possible, do it in person. Take the person or people concerned aside and explain things to them as honestly but as gently as possible.
Of course, due to the current circumstances, this might not be possible. So, yes, you can opt to do it via Zoom, but for heaven’s sake, don’t initiate a group call.
Also, make sure that you also don’t leave them hanging. Provide severance packages or better yet, connect them with outplacement services. This way, you can give them a boost while they hunt for their next job.
Lastly, don’t forget to reassure your remaining staff. Losing team members can be tough, not just for a leader, but also for the rest of the team. Take time to remind each one about how much you value them, and how their jobs are safe.
Remote Staff has been helping Australian SMEs and entrepreneurs like you find skilled remote workers from the Philippines since 2007. Aside from hiring, we also provide onboarding as well as assistance with sensitive matters like terminating a contractor’s employment, whether during the holiday season or at any other time throughout the year.