Staff scale-downs are never a comfortable conversation to broach. But they are a necessary evil.
According to a joint study by the University of Wisconsin and the University of South Carolina, companies see a 1% increase in leads following a workplace reduction yet experience a 31% increase in the number of voluntary employee exits.
Why so much attrition on top of the reduction? In some instances, the way the workforce reductions get communicated can leave a bad taste in the mouths of those still on the team, leading them to look elsewhere.
Companies considering or executing a workforce reduction plan should not underestimate how vital communication is to the process. The idea should be to put strategies in place to ensure your approach comes through as wholly and transparently as possible.
When Downsizing, Dialogue Is Key
When building a contingency plan for workforce reductions, communication is paramount. No matter how well-crafted a reduction initiative is, any confusion or unclear communication will rub your team the wrong way and negatively impact your brand’s perception.
To avoid any blowback, it’s crucial to get to the heart of the why behind your workforce reduction. Typically, companies downsize for many reasons (e.g., changing economic markets, poor management, poor sales, etc.). In other instances, a reduction plan is a step taken to help boost earnings or curb spending. For companies that rely on temporary and seasonal workers, workforce reductions are just a fact of life.
No matter the reason for downsizing, it needs to be communicated to those being let go and those remaining with the company. For seasonal workers, recruiters need to be clear with candidates on job parameters like start and end dates, responsibilities, etc.
Taking every opportunity to communicate expectations to workers (temporary, part-time, or full-time) makes it easier to accept plans to downsize. Current employees will have more peace of mind, and those who are let go will leave with a better employee experience that is shareable with potential new hires.
How to Communicate Downsizing to Employees
People are at the heart of any workforce, whether they’re being brought on, supported, or let go. To develop a transparent and people-centric workforce reduction outlook, try the following strategies:
1. Plan your offboarding as thoroughly as your onboarding. Many companies put thought into their onboarding process, but do they do the same when it comes to offboarding? Good communication starts with having a thorough process, so make sure steps are in place to encourage transparency in your workforce reduction plan.
In 2013, Michelin CEO Jean-Dominique Senard examined its past restructuring processes and tried to apply those insights to current and future practices. Based on those 2013 insights, the tire company realized its Budapest location would have overcapacity for truck tires, meaning it could close the factory in mid-2015 and have enough time to plan for that shutdown.
Develop and fine-tune your workplace reduction policy and communicate that plan regularly. Plot every aspect of the offboarding process so your team feels informed and supported from beginning to end.
2. Set expectations accordingly. When downsizing, over-communication can be just as crucial as clear communication. To that end, let your team know when reductions are coming — including the when and why.
Put senior people in place to relay details and let team members know what they should expect in the coming days and weeks. By not setting expectations upfront and letting people get surprised by the news, trust is broken just as quickly as it’s established — and the relationship might end on a sour note. Be clear about what each step of the workforce reduction process will entail to create a positive employee experience that will spread to others.
3. Use multiple channels. Not every employee likes communication delivered in the same way. To communicate any downsizing plans as clearly and promptly as possible, consider connecting with employees on multiple platforms (e.g., email, text message, phone call, etc.).
For example, our company has a pre-lack of work (L.O.W.) email for our seasonal employees that we send a few weeks before an assignment is scheduled to end. The workplace reduction letter lets them know how the next few weeks should unfold, how they can prepare, and what resources (e.g., résumé assistance, local recruiting experts, etc.) we have to help with the transition.
Make sure your employees receive your correspondence and are in the know. Use phone, email, and any other channels you might have at your disposal to ensure communication lapses don’t affect the experience on the way out for your staff.
People-centric companies maintain an open and considerate mindset from one end of the process to the other. When reducing your workforce, be transparent and communicative about what employees can expect before, during, and after the workforce reduction to maintain a positive experience at every stage.
Want to know how to communicate with candidates and employees when market conditions get uncertain? Download the whitepaper “What Job Market Conditions Mean for the Way You Communicate With Candidates” to learn more.