Here’s how to tell if your company’s layoff policy is “good”

Here's how to tell if your company's layoff policy is "good"
Written by admin

Andreypopov | stock | Getty Pictures

layoffs this year mostly limited to the most affected sectors of the economy, especially technology. But depending on your industry, you could face layoffs if the economy slows more drastically in 2023, and it’s not always clear what to expect from a prospective employer. Go.

Recent headlines have shown how broad the companies’ layoff policy can be. cut and burn approach The pains of some leaders were made public by Elon Musk on Twitter letters about layoffs Arrangement of various benefits for leaving employees.

Layoffs are a reputational issue for companies at a time when the American public ranks how businesses treat their employees as the top ESG issue, according to an annual survey conducted by Just Capital. Living wage, training and career development opportunities, employee security and diversity are factors that influence human capital metrics, but this does not mean that companies get a free pass in how to reduce headcount. “Layoffs can be done fairly,” said Martin Whittaker, founding CEO of Just Capital.

“My general philosophy in letting people go is that you want to be nice to people because it’s all based on your brand, and employer branding is so important in today’s market,” said Paul Wolfe, former head of HR at Indeed and now running his own company. consulting firm. “People who come out are still out there talking about your brand,” he said.

But there’s a big problem: Many workers don’t know how to evaluate a layoff agreement, in fact, they can’t distinguish between a just and an unfair dismissal. Here are some suggestions from career experts for an employer-employee interaction that no one would want to have, but it’s better to be prepared in advance.

Don’t sign anything when first reported

A very important piece of information to get started: you don’t have to sign a job separation offer. In fact, he is the #1 number one of career coach Fiona Bryan. 1 piece of advice when offered a layoff is to not sign any documents immediately when you are first notified.

“This is a really emotional time, and legally, your employer is required to give you a notice of how long you have to sign the paperwork,” said Bryan, a professional career coach at Ask A Career Expert and senior managing partner at The Bryan Group. . “Get the offer and read it. Ideally, take it to an employment attorney, and some will offer short, free consultations.”

“It depends on the company, but you usually have 21 days to sign a layoff offer,” said Toni Frana, career services manager at FlexJobs, a membership-based job site for remote and hybrid roles.

“You can always negotiate the package,” said Andrew Challenger, senior vice president of relocation firm Challenger, Gray & Christmas. And he says employees are more likely to succeed in this environment; This is a situation where many companies are overhiring for a slowing economy, as opposed to a sudden, serious drop like the Covid crash. “This is not a panic, this is not a falling knife,” he said. Employees will never have more influence in a negotiation on their way out, such as when they accept a job offer, but “now is a better time than during a major crisis,” he said.

Once you’ve had time to process the emotional, financial, and mental changes that come with a layoff, here’s how to find out if your company’s offer to lay off was a good one and if it’s time to negotiate for the better.

How you get severance pay matters

When it comes to severance pay, Bryan advises people to determine whether to pay the money in bulk or whether the company will keep the money on the payroll while it is deposited into their accounts.

“Sometimes it’s nice to take your layoff money and get a new job if it’s paid in bulk,” Bryan said. “But sometimes it’s helpful for people to stay on the payroll so they can continue to list ongoing employment at the company on their resume.”

If you’re still getting a check from the company, Bryan said you can still say on your resume that you worked for the company. This is especially important when someone who has worked for the company for a short time is laid off and may list active employment for a while.

How much money should you expect

Most companies that offer severance pay base it on tenure at a company. Frana said the rule of thumb is for companies to offer your salary of one to three weeks for each year you work for the company.

If you have worked for the company for one year, you may receive a salary of one to three weeks. But if you’ve been with the company for 10 years, you can get a salary of 10 to 30 weeks.

“If you are valuable to the company, you can get or ask for additional money,” Bryan said. “But two years of severance is usually the maximum. In my history of doing this, I’ve never heard anyone go past 24 months.”

How to deal with layoffs and manage affected employees?

Evaluate health benefits and quitting together

In addition to how much salary you get, how quickly your health benefits expire is another part of a company’s layoff offer.

“I found [health benefits] “Review the month the person was on the payroll,” Bryan said.

Bryan said that if you’ve been on the payroll for two months or a year for your severance pay, your health benefits coverage will usually continue for that period as well. But if you buy in bulk, it’s difficult for a company to continue your health insurance coverage.

“This is the way insurance companies work. If a person is not an employee, the company cannot pay the insurance premium,” Bryan said. “If you’re still on the payroll and you’re being paid your regular salary, then a company may also pay your insurance premium.”

In the current tight labor market, some companies offer more. In its most recent layoffs, fintech firm Stripe said it was offering the cash equivalent of six months of current healthcare premiums, or continued healthcare.

In the U.S., no matter how or what severance you have been offered, Department of Labor requires companies to ensure temporary continuation of health benefits that were previously offered to people while working for the company. This often happens at the expense of the employee and Required under COBRAor the Consolidated Omnibus Budget Reconciliation Act.

Frana said that while each company is different, they will offer a bid bond for about two months. However, these ongoing health benefits are not offered to you as an employee at the rates offered and can be expensive for newly laid off people.

Challenger said the “headline number” of total weekly severance pay is the most difficult to negotiate, but that peripherals such as healthcare may have more room to keep on payroll longer and the PTO to demand better terms from employees.

Career assistance to reach an agreement

While severance and medical benefits are critical, there are additional resources companies can offer in your layoff package, and you can negotiate some of them even if they aren’t offered initially.

Because that’s what HR usually wants to do, it’s important to help employees know about the parts of the package that don’t need to cost money or set significant precedents, Bryan said.

Job placement benefits such as resume reviews, career coaching, and interview training are the primary resources companies can offer in their severance packages.

Lisa Rangel, founder and CEO of Chameleon Resumes, a resume writing and recruitment consultancy firm, said these are among the resources people most need to help them get back into the job market when laid off.

“If the company isn’t offering them directly, you can negotiate for them yourself,” Rangel said. “Or if they offer a general layoff advantage, you can negotiate which specific services will benefit you and see if they will do that.”

Other resources may include connection to the company’s alumni network and even access to internal resources such as attorneys to assist with legal needs. When online payment company Stripe laid off workers in Novemberoffered career and immigration support to former employees, as well as access to an alumni email address. Second, it is extremely important for foreign visa workers whose residence in the US is dependent on having a job.

While these services aren’t typically offered by every company, Bryan said an employee can always want and get what he or she needs, and that will help if the cost isn’t too high. He added that if you haven’t been offered what you need or think you deserve based on your tenure and performance, everything is negotiable, just like a job offer.

Wolfe said a company’s business goes beyond expanded financial benefits. In the case of being laid off as an HR leader, “My job is to help you as much as possible and help you get your next job, and companies want to help if they care about employees,” he said.

“If you haven’t been in a layoff situation before, negotiation may not be something you automatically consider,” Frana said. “You can always try to negotiate, you won’t know until you try if there’s room for negotiation.”

While getting fired is never ideal and often not expected, Bryan said you should always stand up for what you need and deserve.

“Supremacy packages can be good when you know they’re coming and you’ve made some plans,” Bryan said. “But re-entering the job market takes resources, and it helps when you’re well prepared so another company can pick you up.”

About the author


Leave a Comment