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Shannon McLinden, President, Farmhouse Fresh, Chase for Business customer
4 essentials for guiding your business through layoffs
Layoffs are painful for everyone involved. Unfortunately, during tough economic times like the ones we’re experiencing with the coronavirus pandemic, downsizing may be unavoidable.
When faced with the challenge of letting people go, business leaders can preserve employee trust—which is essential to post-crisis recovery—by communicating respectfully and transparently.
“The key is, how do we take care of our people so that once the sun comes out, we can keep going with our business?” says Michael C. Bush, CEO of Great Place to Work®, in a recent Chase Chats Webcast. “We need to do what’s required for them so that they can do what’s required for our customers.”
Bush recommends four strategies for leading your organization through furloughs and layoffs in a way that keeps employees connected and encouraged.
1. Exhaust all alternatives.
Furloughs and layoffs should be last resorts because of the disruption they can cause to your business and their hardship on employees. Consider asking employees to take voluntary unpaid leave or a temporary pay cut. Explore whether you can reduce or freeze employer-paid benefits such as retirement plan contributions and health insurance to keep more people on the payroll. Your business also may qualify for forgivable or low-interest loans and other government-backed assistance programs.
2. Communicate bravely, clearly and often.
Don’t avoid discussing the possibility of furloughs or layoffs with employees; it’s already in the air. If people aren’t hearing from you, they will likely create their own stories based in fear and uncertainty. Acknowledge their emotions and the financial repercussions of being out of work. Share your own feelings and experiences. Give employees opportunities to ask questions and process the news together.
3. Provide extraordinary care and support.
If a furlough or layoff is unavoidable, handle it as compassionately as possible. Connect your people to transition counseling, financial assistance programs and other support. Help them apply for unemployment benefits and job retraining. Establish or expand your company’s own relief fund to support employees and their families affected by the economic uncertainty. If you can, share hopeful dates for reinstating employees once the tough times have passed.
4. Keep it fair for all.
Be transparent about your process for choosing who will be furloughed or laid off. Bring multiple perspectives into conversations about restructuring your business. Be mindful of diversity and inclusion issues when evaluating specific employee layoffs as well as your overall plans.
Separating from valued employees—even for a brief stretch—is never easy or inconsequential. When reducing your staff is the only way for your business to survive, navigating the crisis with compassion and people-centered communication will help you bounce back stronger.
Explore more of Michael C. Bush’s tips for building employee morale in challenging times.
Michael C. Bush is CEO of Great Place to Work, the global research and analytics ﬁrm that produces the annual Fortune 100 Best Companies to Work For list, the World’s Best Workplaces list and dozens of other distinguished workplace rankings around the world. Bush brings 30 years of experience in leading and growing organizations. He also serves on the board for Workday, a leading provider of enterprise cloud applications for finance, HR and planning. He is a former member of President Obama’s White House Business Council and a founding board member of Fund Good Jobs, a private equity seed fund that invests in inner-city small businesses. Bush is compensated by Chase.
For Informational/Educational Purposes Only: The views expressed in this article may differ from other employees and departments of JPMorgan Chase & Co. Views and strategies described may not be appropriate for everyone, and are not intended as specific advice/recommendation for any individual. You should carefully consider your needs and objectives before making any decisions, and consult the appropriate professional(s). Outlooks and past performance are not guarantees of future results.
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