Waiting for the Other Shoe…
Surviving Employees Endure Layoff Anxiety
By Linda T. Kennedy
October 15, 2009
If you are an employer who believes the recession ensures employee retention, you might learn otherwise when the economy rebounds. That’s because experts say your employees are watching how you handle the employees who are left behind.
“They are observing how you are treating the employees, even those ones you layoff, and they are forming opinions about your company culture,” says Monica Whalen, attorney, president and CEO of The Employers Council in Salt Lake. “And true, they may hold onto their job for the moment out of desperation, but the first opportunity they have to go somewhere else, they will if they have formed a negative opinion about the way you treat people.”
According to a recent survey by a New Orleans, La. outsourcing company Challenger, Hatch and Christmas, U.S. layoff survivors are stricken with survivor’s guilt and anxiety, assuming that it is only a matter of time before the other shoe drops. Even though revised Utah job loss figures show the numbers are almost double what experts initially anticipated, David Stringfellow, economist for Utah’s Governor’s Office of Planning and Budget, says additional layoffs are expected to continue into next year.
“In addition to layoffs, many employers have decreased workers’ hours, instituted pay cuts, forced employees to take unpaid vacations and halted matching 401(k) contributions. While some of these measures have saved jobs, they undoubtedly left many workers disgruntled, frustrated and ready to move on as soon as the market improves,” says Stringfellow.
Wallen says the construction and manufacturing industries, as well as those with call centers where employees already feel more like a commodity than a team member, are especially at risk for losing employees.
“The common wisdom is: Employees need to do everything they can to hold onto their jobs, so why should employers be concerned about engagement and employee retention?” says Whallen. “But if you think about it, those employees who are still on your payroll are most likely your star performers, those critical contributors you cannot do without. So, a wise employer is going to put some effort into motivating, engaging and retaining those key employees.”
Whallen suggests employers take five key steps to keep surviving employees engaged and focused after layoffs:
1. Give employees new challenges
The survivors remaining on your payroll are self-motivated, creative and like challenges. You can use them to get things done on your to-do list that you haven’t been able to get to. Giving them an exciting, fun project will likely engage them in the way they perform best.
2. Share a stake in the company
Involve layoff survivors in decision making and get their input. Sometimes management is fearful of asking non-management level employees to be involved in decisions because that’s traditionally management’s role. But the people on the ground floor often have the best ideas about how to improve the company. This process of empowering them to feel as if they have a stake in the success of the company makes a difference.
3. Express appreciation and recognize good performance
With the recession, employees are generally feeling fearful and stressed. If they are not hearing appreciation from their boss in a public or one-on-one way, then they are left to those raw emotions without the security they seek to stay with the company. It is important for immediate supervisors to give signals of appreciation and recognition to the good performance of his or her subordinates. “That’s a hallmark of a good boss, the pinnacle of good management,” says Whalen.
4. Be honest about company standings
Let your employees know where the company stands financially and strategically on achieving its goals to the extent that it makes sense to them. But more importantly, let your employees know what your plan for moving forward is. Many companies have lost a big client or the sole vendor source, so employees know it is not business as usual. Without management cluing them in to their modified strategy, mistrust and speculation can develop.
5. Communicate total compensation
When you show employees the total value of their compensation package, they are often astounded at the actual amount. Add the benefits, workers’ compensation insurance costs, the employer’s share of FICA and the unemployment insurance into employee’s wages and discuss it with them.
The Employer’s Council has a reduction-in-force (RIF) tool kit that employers can use before making job-cut announcements. It includes a checklist as well as information on how to determine who should be included in the RIF, legal considerations and severance benefits.