Responsible retrenchment: Acting with empathy and transparency

Dyson’s recent layoffs of an unspecified number of employees has once again placed the spotlight on how organisations approach layoffs.

While Dyson did not break any employment laws in Singapore, it is the manner in which the layoffs were conducted that have rankled many. Without prior notice, affected employees were provided with a one-day notice layoff, leaving many in shock and disbelief.

Besides causing considerable distress to affected employees, are organisations that conduct layoffs this way risking their reputation as responsible and caring employers?

Adopting responsible layoff policies is crucial for organisations to maintain trust, safeguard employee wellbeing, and uphold their reputation, said Josephine Chua, Director of Human Resources & Quality, Aloft Singapore Novena.

She told HRM Asia, “Compliance with regulatory guidelines, such as Singapore’s Tripartite Guidelines on Mandatory Retrenchment Notifications, is essential to ensure that retrenchments are conducted fairly and lawfully. These policies should also be approached with transparency, empathy, and clear communication throughout the process.”

“By addressing both the immediate and long-term needs of affected staff, organisations can demonstrate their commitment to responsible and compassionate leadership.” – Josephine Chua, Director of Human Resources & Quality, Aloft Singapore Novena.

Compassion and empathy for affected employees going through a difficult transition must be a priority, with Chua advocating for support in the form of fair compensation, outplacement services, and career counselling.

“By adapting these practices, organisations can demonstrate a commitment to responsible corporate citizenship, while also maintaining the morale and engagement of their remaining workforce.”

Organisations that want to take one step further can also consider offering holistic assistance that goes beyond financial compensation, she added.

This can be in the form of emotional, practical, and professional help to help affected employees navigate their next steps. Maintaining open lines of communication, providing mental health resources, and fostering a supportive environment help ensure that employees feel valued and respected throughout the transition.

“By addressing both the immediate and long-term needs of affected staff, organisations can demonstrate their commitment to responsible and compassionate leadership,” said Chua.

Agreeing that organisations can and must do better, Raunak Bhandari, Regional HR Business Partner Leader, Google, said, “Adopting responsible retrenchment policies is essential for organisations aiming to maintain their reputation, employee morale, and overall sustainability.”

“Responsible retrenchment policies are not just about minimising negative impacts; they are about treating people with dignity and respect.” – Raunak Bhandari, Regional HR Business Partner Leader, Google.

Organisations that handle layoffs poorly, he added, can suffer long-term damage to their brand and image, both externally and internally. With organisations increasingly held accountable for their social impact, responsible retrenchment aligns with corporate social responsibility (CSR) goals. Depending on which country they operate, proper retrenchment policies also help ensure compliance with labour laws, minimising the risks of lawsuits and repercussions.

Another aspect that organisations cannot afford to neglect is the impact the lack of responsible retrenchment policies can have on their ability to attract and retain the best talent.

Raunak highlighted, “Treating departing employees with respect can lead to positive referrals and maintain connections with potential future talent. Transparent and fair processes are also critical to preserve morale and reduce anxiety and uncertainty among remaining employees. Therefore, thoughtful retrenchment can help retain critical talent and skills needed for future success.”

READ MORE: Josh Bersin: Let’s talk about layoffs and how to handle them

To get organisations started on the right path, he provides some key tips on how to implement responsible retrenchment policies:

1. Clear communication: Be transparent about the reasons for retrenchment, the process involved, and how decisions are made. Regular updates can ease anxiety.

2.  Fair selection criteria: Use objective criteria for selecting employees for retrenchment, such as performance metrics, tenure, and business needs, to minimise bias.

3.  Support services: Offer outplacement services, counselling, and career coaching to help affected employees transition to new opportunities.

4.  Severance packages: Provide fair severance pay and benefits that reflect employees’ tenure and contributions.

5.  Engagement with stakeholders: Involve employee representatives or unions in discussions about retrenchment policies to ensure concerns are addressed.

6.   Flexible solutions: Explore alternatives to layoffs, such as reduced hours, voluntary separation packages, or job sharing.

7.   Post-retrenchment support: Maintain contact with former employees through alumni networks and offer assistance with job placements.

8.   Review and adapt: Regularly review retrenchment policies to reflect changing business needs and ensure they align with best practices.

“Responsible retrenchment policies are not just about minimising negative impacts; they are about treating people with dignity and respect. By implementing fair and thoughtful strategies, organisations can navigate difficult decisions while preserving their integrity and fostering a positive workplace culture,” Raunak concluded.