Editor's Note
How to Make Layoffs Worse
Nobody likes layoffs. As someone who guided employers through the pandemic shutdown, I'm not sure I will ever get over how difficult and heartbreaking those layoffs were. They all are. People who have little power and no voice in the decision making lose their jobs, benefits, and the income that they depend on.
Humans are also very bad at endings. Ending relationships of any kind is uncomfortable for everyone involved. And when we are stressed, sad, and angry, we like to blame someone—someone besides ourselves. Whether you are an employee, an employer, or both, it's normal to be stressed, sad, and angry when faced with layoffs.
Don't ever blame employees for layoffs. Nobody deserves to be laid off. And it's not their fault.
It's also a good strategy to offer severance if possible. It helps employees land a little more softly and gives them some time to find the next role. It helps employers by managing the risks of getting post termination claims. Wage-hour and discrimination-harassment claims always rise when there are terminations—employees just lost their jobs; they have nothing left to lose. Severance in exchange for a release of claims provides closure to everyone.
This article also discusses including nondisparagement clauses in severance agreements. Knock yourself out, but I'm not a fan. Nondisparagement clauses don't really stop anyone from saying anything to anybody. And even if an ex-employee posts something unflattering on social media, you don't ever want to actually enforce a nondisparagement clause. What's worse than someone badmouthing the company on social? A lawsuit—particularly a lawsuit by an employer against its former employee who it laid off that's complaining about a bad thing that employee said afterwards. The lawsuit is public record and the bad thing gets repeated and sometimes even makes the news. The employer, who is already dealing with financial trouble, then gets to pay a bunch of lawyers to fight about whether the bad thing violates the agreement and how the company was damaged.
It's a bad look. And a bad strategy.
This is usually where the employment lawyers agree that enforcing nondisparagement clauses comes with its own risks and downsides, but having the clause in the severance agreement is still a good idea because it deters people from saying bad things by just being part of the agreement.
This seems like a weasel move. I also doubt it's true. But I don't know and haven't seen data. I suppose someone could survey laid off employees and ask if they ever refrained from saying bad things about their former employer because they signed a nondisparagement clause. But I would expect an extremely low response rate.
Instead, employers should do their best to help employees move forward. A little vitriol or venting on social media should not change that.
Here's a nice discussion of some of the legal issues involved in layoffs and less cranky approaches to consider with severance agreements.
- Heather Bussing
Waves of mass layoffs during the past two years have generated a new trend: layoff influencers who use social media to vent feelings, get assistance with a job search, and find community with other laid-off workers. This trend raises concerns for companies that don’t want misinformation or embarrassing stories about them to be circulated online, and opens doors potentially to third parties seeking to represent employees in collective bargaining and potential litigation.
Quick Hits
- Some laid-off workers are becoming social media influencers, telling their layoff stories to thousands of followers and outsiders.
- Former employees generally are not prohibited from criticizing their former employer on social media if their comments are true and not defamatory.
- To protect their brand and public image, companies can offer severance agreements, including nondisparagement clauses, to laid-off workers.
Hundreds of thousands of employees were laid off in 2023, especially in the tech, construction, manufacturing, retail, and hospitality industries. As of July 2024, the U.S. unemployment rate was 4.3 percent, according to the U.S. Bureau of Labor Statistics.
Some of the laid-off workers utilized electronic media to position themselves as influencers with thousands of followers. They are using social media, podcasts, livestreamed videos, and blogs to discuss their layoff experiences, the job application process, their hopes for the future, and a “day in the life” of unemployment. These influencers can declare themselves #OpentoWork on their professional social media profile. They can like and comment on each other’s posts in hopes of gaining more visibility to recruiters and potential employers. Some of them have formed informal online networks to provide support, polish resumes, and trade tips about job openings and gig work.
This is much different from the past approaches following layoffs, which consisted mostly of confiding privately to friends and family.
The growing social media trend mainly involves younger millennials and Gen Zers. These facets of the employee population are far more sensitive to social media influencing and more likely to jump on board with movements to hold employers accountable for failing to reflect the needs and demands of younger workers, such as work-life balance, mental health sensitivity at work, and environmental consciousness. Layoff influencers also make it easier for labor unions to capitalize on social media to encourage organizing to assist younger workers in getting what they want from employers.
Depending on the circumstances and employment level of the employee, an employer may try to rely on written corporate policies, progressive discipline, and performance improvement plans to limit the critical public speech of an existing employee. But those avenues are generally unavailable after an employee is laid off or fired.
In general, the First Amendment of the U.S. Constitution protects private citizens’ right to criticize a company, as long as their comments don’t amount to slander or libel. In most cases, social media posts are not slander or libel if they are true.
Next Steps
After a layoff, an employer may wish to monitor any mentions of their brand, company name, or products on various social media channels. An internal public relations team or external public relations consultant may help the employer determine whether to respond to a specific post from a former employee.
Federal and state laws apply to layoff situations. The federal Worker Adjustment and Retraining Notification (WARN) Act requires a business with one hundred or more full-time employees to either give employees sixty days’ notice in writing of a mass layoff or plant closing, or pay the employees’ wages if it fails to give the notice. In addition, many states have state versions of the WARN Act, and the compliance details can vary.
Some employers voluntarily choose to pay severance to laid-off workers in exchange for signing severance agreements. These agreements may require the workers to return the employers’ electronic equipment and not to disparage the former employer publicly. Severance pay is generally not mandatory unless stipulated in a union contract or individual employment contract.
