According to a recent survey by Resume Builder, 38% of companies are expecting to lay off employees in 2024, and the start of the new year has already seen the announcements of thousands of employee layoffs across all sectors.[1]

Disgruntled employees have taken to social media to share how they were treated on their way out the door.[2]

Some have livestreamed their termination meetings; others have shared their tears or anger over the departure; and still others have shared anecdotes about being accused of stealing confidential information, or workplace office supplies or snacks.

While there is no one right way to conduct a layoff, here are some considerations to help ease the process, minimize legal risk and treat departing employees with dignity.

Take Your Time

Except when a company's financial position is so dire that immediate action is necessary, don't rush the reduction-in-force, or RIF, process. There are a number of laws that may factor into conducting an RIF, including the federal Worker Adjustment Retraining and Notification, or WARN, Act and similar state laws. These laws require employee notice prior to a layoff and impose a variety of penalties for failure to do so.

While the federal WARN Act applies to businesses with more than 100 employees, numerous state laws — sometimes referred to as "mini-WARN" acts — have significantly lower thresholds for covered business and the size of a planned layoff. For example, New York's WARN Act covers employers with just 50 or more employees, requiring 90 days' of notice for any layoffs affecting 25 or more employees.

There may be exceptions to the requirement to notify employees, such as the federal "unforeseeable business circumstances" exception that many companies relied on during the COVID-19 pandemic and subsequent business closures. These laws are nuanced, and a failure to vet whether a layoff — or series of layoffs — may be covered could subject a business to unanticipated costs.

In addition to WARN acts, both federal and state discrimination laws still apply to your selection criteria. Take the time to formulate legitimate business reasons for the selection of employees, and conduct an adverse-impact analysis to assess whether the RIF disproportionately affects any protected class.

Prepare the Paperwork

Consider offering severance benefits in exchange for a release of claims, even if your company does not have an established severance plan in place. Severance is an important tool in assisting an employee's transition to a new job and offers the business some peace of mind from potential lawsuits, though not every employee claim is waivable.

While past practices may inform your calculation of severance, the company's current financial situation may warrant a different practice. In preparing the releases, ensure compliance with any mandatory review or revocation period under federal or state law.

For example, the federal Older Workers Benefit Protection Act mandates a 45-day review period and seven-day revocation period for a group termination affecting two or more employees aged 40 or older, if the release includes a waiver of age discrimination claims. In addition, the act requires an attachment listing the ages and job titles of employees affected in the layoff — and others within the same decisional unit.

Employers should also review release templates for outdated confidentiality, nondisparagement or noncompete language. With more states legislating against the use of restrictive covenants, you want to ensure your release agreements don't create liability.

California employers know all too well that S.B. 699 imposes a new private right of action, penalties and attorney fees on any employer that enters into an unlawful noncompete, even if the company does not plan to enforce it.

Be Honest, but Succinct

In addition to any severance agreements, you should consider developing talking points for both the affected employees and the retained employees. Sticking to a script will help ensure that managers don't give incorrect or improper information while communicating the company's message. Talking points promote consistency of communication.

Don't sugarcoat, lie or minimize the impact of the separation. What you say in the termination meeting can be used against the company in future litigation, so be sure you are factually accurate when stating decisions were made based on salaries, performance or other criteria.

You may also consider a day or two in advance, generalized communication that layoffs are coming to ease the element of surprise. Advance notice isn't always practical given security or theft concerns, though.

Coordination is Key

There are many logistical considerations that affect the RIF. Will the communication take place in person or remotely? Individually or as a group? Are there other employees working in a physical shared space? What equipment needs to be returned, and how will you facilitate that process? What security measures are needed for physical office security as well as cyber- and data security?

The answers to each of these questions are highly individualized, but proper planning will help ensure a smooth transition process.

Assign a key contact to answer follow-up questions and collect severance agreements. Ensure everyone gets a copy of all the necessary documents, including unemployment benefits, 401k information and healthcare continuation, so employees don't have to chase down what they need.

Make it as easy as possible for employees to return equipment or confidential material, so as not to add to their stress. If meetings are held on-site, hire security for the safety of all employees, but don't treat departing employees as criminals.

Kindness Counts

The layoff should ideally be conducted by someone the employee is familiar with. Whether as a witness or the primary communicator, it's important that the employee sees a familiar — and hopefully, trusted — face who can deliver the message with compassion and transparency. Losing a job is a stressful life event and everyone's interests are best served when management does not lose sight of that basic fact.

With RIF meetings being livestreamed on TikTok, employers face extra pressure to deliver difficult news in an honest and empathetic manner to avoid negative publicity — and angry former employees. Employers should also refrain from sharing confidential information during the communication, as even employees who record the call unlawfully are unlikely to face recourse. Even if meetings are not shared live, "watch me get fired" videos have become increasingly popular on social media, garnering millions of views and attention unwanted by employers.

Rally the Remaining Team

In addition to the communication plan for departing employees, it's just as important to meet with the retained employees to communicate a transition plan. The message should acknowledge the hardship of the RIF and the plan for moving forward.

Don't promise them a future at the company if you anticipate further layoffs may be necessary. Document any changes in job duties or expectations due to staff reductions and share any changes in reporting structure.

Allow for a short transition period to address their needs and fears before resetting those expectations and performance metrics. Consider whether to offer retention bonuses to key employees if they are critical to the company's success post-RIF.

In an age of cancel culture, management can use a difficult situation as an opportunity to display leadership and set an example to their team and customers.

[1] https://www.businessinsider.com/layoffs-sweeping-us-these-are-companies-making-cuts-2024

[2] https://www.wired.com/story/the-stark-realities-of-posting-your-layoff-on-tiktok/

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