How to lay someone off

We appear to be looking down the barrel of a sustained economic downturn. A correction, some say. We used to call it a recession. No matter the term—it’s here, and preparations must be made to ensure your business makes it to the other side.

“These are the times that try men’s souls,” wrote Thomas Paine on December 23, 1776. The American revolution looked hopeless, and its army was retreating in New York and New Jersey. It was a cold, freezing winter. George Washington ordered Paine’s full letter, “The American Crisis,” to be read out loud to his troops.

Washington likely hoped this passage would resonate most:

The summer soldier and the sunshine patriot will, in this crisis, shrink from the service of their country; but he that stands by it now, deserves the love and thanks of man and woman. Tyranny, like hell, is not easily conquered; yet we have this consolation with us, that the harder the conflict, the more glorious the triumph. What we obtain too cheap, we esteem too lightly: it is dearness only that gives every thing its value.

I know this is starting to feel like a goober LinkedIn post, but what if I told you there’s little difference between a CEO executing layoffs and George Washington facing execution for treason against the crown?

No? It’s not comparable in any conceivable way whatsoever? Well, maybe I don’t understand LinkedIn. Let’s move on.

A lot of people are getting laid off right now. That’s the point. Companies and leaders are making hard decisions, cutting valued staff they worked so hard to recruit not too long ago. You’ll find plenty of news articles explaining why these layoffs are happening but surprisingly few resources on how to lay someone off in the most compassionate and productive way possible.

I decided to ask around.

Here’s a response I got from a CEO running a multi-billion dollar company:

Layoffs are a part of business. And by layoffs, I mean decisions made by a company to reduce headcount, not laying someone off for poor performance or behavior. Companies expand, contract, and often need to change the way they operate. I saw one comment on your post say that the best time to plant a tree is 30 years ago—likening it to needing to have compassionate leadership to start with. I believe that is the key and something the business world needs to change.

We need more leaders who lead with compassion and fewer narcissists. Compassion can’t be faked during the rough times. The reality is most leaders are just trying to protect their own image when they have to announce layoffs or downsize. I always try to steer people to work at companies where they trust the leaders, hopefully, experienced leaders.

A few things I have recently recommended to CEOs faced with layoffs (not sure if they listened):

– Be honest
– Own the decision and explain how you arrived at the decision
– Be generous with severance
—I think 90 days should be the new standard for company-driven layoffs
– Make a public announcement so employees don’t have to invent their own stories and explanations
– Provide opt-in help for employees where you share their contact info with other companies
– Provide 90 days of health insurance and remind employees of mental health benefits they may have
– Check-in with the folks you know well and make sure they are doing ok in the months following

Here’s another response I got from a highly-qualified leader:

I think it’s a bit like the “best time to plant a tree was 30 years ago” proverb. It starts with being a great, compassionate leader to begin with. But I think the only universal thing is to be as generous as possible and reasonable with severance and messaging. And then as helpful as is possible and reasonable with affected employees in their search for new employment.

And another from a well-respected CEO coach:

The saying goes there is no great way to do a layoff, only less sucky ways. So I'm not sure there's a great way, but some companies have done better than others.

There are two considerations at play here if I'm thinking about compassion during a layoff - financial and psychological.

Financially, you can or should attempt to stretch out severance and health care coverage as long as you can. People get sent straight into human hijack survival mode as soon as their employment vanishes, so you're not going to get access to them much at all beyond those base needs. Stipe, Meta, Amazon all threw down to make sure impacted employees had a softer landing.

But psychologically, I think the compassion table is set long before a layoff happens. If you are at a company where leadership only talks about how the company is "crushing it," then when a layoff happens it's jarring and dissonant to the context that has been set by leadership.

But if leadership has an ongoing honest, transparent, and reality-based conversation with the employees, then when a layoff does happen there is at least some shared context as to why it's happening and why it's necessary.

And another from the founder of a talented creative agency:

Don’t make it about you. No one wants to hear that you are sad for having to do it. Don’t unintentionally fish for sympathy. Be direct. Talk about why the decision has been made. Be honest even if the truth hurts.

I knew someone that cried when laying someone off. It was excruciating for everyone evolved.

More advice from an experienced Human Resources manager:

Honesty to those laid off, and those who remain. People will stay at a company through thick and thin if they have a leadership team that they can trust.

I have another one! A “what’s next” form or email. When does insurance end, where can they access paystubs or W2s, when is their last check, when will they get COBRA packets, who do they reach out to with questions, how do they rollover HSAs, 401k distributions, so many bits of info that really help people be set up for success. Things you won’t think to ask for in a moment of being laid off.

Finally, some advice from a serial founder and business professor:

Do it November 15 or January 15. Nothing magical about December other than it adds a layer of anxiety around Christmas that really sucks for employees (and their families if applicable).

We can’t control circumstances, but we can control how we respond to them. We’re all human beings with family, friends, and loved ones. Laying someone off is one of the most difficult decisions a leader can make. Why not do it with compassion and empathy? Why not go out of your way to make it the best experience possible—not for you or your company—but for that fellow human being whose journey and future just changed through no fault of their own?