It is “Lay-off Season” in Corporate America: Brace Yourself

Saturday night while at dinner with several friends from the Human Resources part of my life, the conversation was light and fun. The food was delicious and our experienced server had perfect timing balancing leaving us alone to talk & laugh and making sure our needs were met. We reminisced on the old days of doing employee benefit enrollment by hand with paper before it was automated. Everything was going great and as the entrée arrived the workforce planning consultant among us cast a pall over the mood as he reminded us his practice was busier than ever because it was “layoff season” with a glint in his eye that seemed a little evil to me. My appetite weakened and all eyes darted toward me because it was my idea to invite him—it was like the “Grim Reaper” joining us for dinner.  At the risk of knowing this would turn into a blog post, the consultant continued to talk throughout the entrée course—as consultants often do.

So, brace yourself, lay-offs are coming.

An HR spouse commented that it seemed a shame that corporate lay-offs occurred so close to the holidays and ruined Thanksgiving and Christmas with job loss notices. Our consultant friend reminded us that many activities happen BEFORE a person receives their lay-off notice and severance agreement. (I guess that is what pays for the gleaming new luxury car he drove into the parking lot.) The terms downsizing, right-sizing, lay-off, reduction in force (RIFs) are all yesterday. Today’s clients call it “headcount reductions” and the workforce planner’s task seems very mathematical and legal in nature. Sometimes senior management (usually the finance department) will engage him without much interaction with human resources because the HR department is also going to lose people too. Despite what we think, the target is not always long-tenured highly-compensated mature employees. Because of the litigious nature of people, he’s clear to first document the business need for laying people off. His team, which includes an attorney and statistician conducts an adverse impact analysis shared with his client’s in-house counsel, finance person and VP of Human Resources. That’s the step that insures or allegedly insures the mature workers are not singled out for lay-off. If you or a friend find yourself laid off, here are steps you should consider:

#1- Even if you are short on cash, invest the money in having an employment attorney review the severance agreement and general release you are being asked to sign. Not every company hires a knowledgeable consultant or has the skills in-house to properly prepare an adverse-impact analysis. In the United States, workers >40 years old are protected by the Older Workers Benefit Protection Act. In a group termination, there are special considerations for older workers and courts are trending toward invalidating template-styled releases companies obtain through the Internet or professional associations. I cannot suggest this strongly enough. Would you rather spend $200 for an hour of an attorney’s time or be cheated out of thousands of dollars or maybe even your job? It’s money well-spent.

#2- Have the employment attorney explain every section of what you give up by signing the release (generally it is the right to sue-which is usually pointless anyway). Use that document to bargain or negotiate if you need more $$ than the severance plan allows or extended benefits before you go onto COBRA or to propose continuing as a consultant. No matter what, make sure you react in a timely way to the release, so you don’t lose what the company is offering you.

#3- Immediately contact your state’s unemployment office to find out how soon after receiving your severance you qualify for unemployment, the process and how much you will receive.

#4-There’s a lot of emotional upheaval for a person who is laid-off. Surround yourself with supportive people and begin networking as soon as you can work through any anger or bitterness that comes through you. It sounds cliché, but it is so true, one door closes and another opens.

The good news is—the workforce planning consultant says the lay-offs are not as deep as 2008 and 2009. The business reasons are generally corporate acquisitions and mergers. Uniquely qualified people are still in demand, so while the company is reducing headcount in some areas—there are other areas of the same company still hiring—primarily I/T, systems and technology. Dessert finally arrived and the discussion was light again. (Note to self)--don’t invite the workforce planning consultant to what is supposed to be a relaxing dinner with friends. Make it a great work week!