How to Lay Off Staff
Rather than firing a single employee based on an infraction, layoffs have little to do with the performance of the staff. Instead, layoffs are the result of corporate restructuring or economic downturn and loss of profits. You may have to get rid of people that you like or who are otherwise good at their jobs. As you choose who to lay off from your company, whether five positions or 500, broach the subjects correctly so you don't incur any lawsuits.
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Instructions
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Choosing Employees for Layoff
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Make a list of the positions in your company that are the easiest to remove without hiring additional employees. These could be obsolete positions or roles with two employees that only need one. These should be the first positions you lay off, since there are understandable reasons for removing the position.
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Watch the performance of your staff. When you're faced with multiple choices for layoff, consider employees with worse performance over others in the same position. Look in their personnel files for any infractions or write-ups. The layoffs are an opportunity to purge your company of staff that isn't living up to their positions.
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Look up the hire date for staff you're considering for layoff. Though employees with more seniority tend to make more money than newer hires, they also have more loyalty to the company. Weigh length of service when choosing employees to lay off.
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Keep employees with specialized training. If an employee has extra training, certifications and experience than co-workers, keeping this employee will benefit the company. This is an exception to the seniority rule. If a newer hire has more degrees, consider keeping him over an employee without this experience who has been with the company longer.
Laying Off Employees
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Take each employee aside, and lay them off personally. If laying off dozens of employees, split up the duty between several managers so you don't drag out the proceedings. The personal touch of a one-on-one meeting will help make the laid-off employee feel better and like she mattered to the company despite the layoff. Consider keeping staff of the human resources department present at the meetings as witnesses.
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List the concrete reasons why your company is laying off the employee's position. Express the loss in revenue or economic downturn that caused this decision. Avoid blaming the employee for his job loss as this could cause unwanted lawsuits for wrongful termination. Instead, express that, while you would have liked to keep him on the job, the company can't afford it at this time.
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Come to the meeting prepared with information on the employee's health insurance, last paychecks and other compensation, such as vacation pay. These are issues that staff worry about the moment they hear rumors of a layoff. Compile the documents in a packet, and give it to each terminated employee at the layoff meetings.
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Offer severance to each employee. While this isn't required it can help avoid lawsuits. The severance also will keep laid off and remaining staff happier during the transition. Two weeks pay is the typical severance amount that most companies can provide.
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Ask the employee to sign a complete release upon accepting severance. By signing the release, the employee agrees not to sue your company for wrongful termination. Consult your lawyer or human resources department to draw up a complete release document before the layoffs so you're prepared.
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Thank each employee for her loyal service to the company. Shake her hand and wish her luck in the future. If you give a sincere smile, the staff will feel more accepting of their lost positions.
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Tips & Warnings
Mention something personal to each employee, if possible. Ask how his children are doing or about his spouse. The personal touch will set staff at ease.
References
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