In addition to damaging productivity and morale, poorly handled layoffs can tarnish an employer’s brand. When things turn around, some employers have struggled to hire, according to Cascio. — Image by master1305 on Freepik
Twitter Inc’s mass layoffs have shocked onlookers and insiders alike, but it’s not the first company – and won’t be the last – to be seen as bungling the messy business of sacking staff.
Since billionaire Elon Musk bought the social media platform for US$44bil (RM203.61bil), he fired close to 3,700 people, only to reach out to dozens soon thereafter to ask them to come back. Twitter didn’t reply to a request for comment. All eyes are also on Meta Platforms Inc as chief executive officer Mark Zuckerberg announced more than 11,000 jobs will be slashed from payrolls.
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In addition to damaging productivity and morale, poorly handled layoffs can tarnish an employer’s brand. When things turn around, some employers have struggled to hire, according to Wayne Cascio, a professor emeritus at the University of Colorado Denver Business School who has studied the financial and psychological costs of downsizing for more than 30 years.
“From a senior leadership perspective, you’ve got two choices,” Cascio said in an interview. “You can come across as callous, or you can come across as caring. Which one are you going to choose?”
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That hasn’t stopped companies and their top brass from tripping up. While Musk is taking heat for firing individual workers directly by email, for example, he didn’t pioneer using the platform for cuts. Dell blazed that trail in 2001 during the dot-com bust, announcing that pink slips were coming in a dystopian rendition of You’ve Got Mail. Of all the “reductions in force” Cascio observed over the years, though, five stood out as particularly ignominious.
5. Better (2021)
Digital mortgage lender Better Holdco Inc first made headlines for a mass firing of 900 employees over Zoom in December 2021. The message was delivered in minutes by an expressionless Vishal Garg, Better’s CEO.
ALSO READ: US boss apologises after laying off 900 employees over Zoom
The firm made a second round of layoffs in March, cutting loose 3,000 workers – for some, the news came from severance payments prematurely deposited in their bank accounts. All told, the company made four rounds of layoffs in less than a year. Better declined to comment.
4. Verizon (2002)
Amid a broad telecommunications industry slump and competition from cellphones in the early aughts, Verizon Communications Inc laid off 2,700 technicians in New York and New Jersey just days before Christmas. “It was surreal, like a dream,” a father of two told the The New York Times. “It’s the American nightmare.”
Another technician said he had to scrap his plan to propose to his girlfriend of three years on Christmas now that a diamond ring was out of the question. A Verizon spokesperson didn’t reply to a request for comment.
3. Bird (2020)
Cascio dubbed a cost-cutting maneuver at electric scooter company Bird Global Inc the Black Mirror layoffs, a reference to Netflix’s sci-fi show. Employees logged on to a one-way Zoom call with a dark gray background slide that said only “Covid-19”, and then a disembodied, robotic-sounding voice fired them in about two minutes, according to dot.LA, an independent Los Angeles-based tech and startup publication. More than 400 employees were canned, about 30% of the workforce.
Much like Better, “the worst is when employees have no opportunity even to ask questions, it’s strictly one way communication. That’s just really hard on the employees,” Cascio said. Bird didn’t reply to a request for comment.
2. Robbs (2007)
Arriving for what they thought would be another ho-hum shift, employees at department store Robbs in Hexham, England, were in for a rude awakening. Managers deliberately set off a fire alarm to clear the building of customers and gather its 140 staff members in one place to inform them the almost 200 year-old store would be closing – in two weeks. According to the BBC, its administrators called the decision “efficient and practical”.
1. The Accident Group (2003)
Possibly the only thing worse than getting dumped by text: getting fired. The Accident Group, a UK-based insurance firm, sent over 2,000 employees a text instructing them to call a number. A recorded message awaited them: “All staff who are being retained will be contacted today. If you have not been spoken to you are therefore being made redundant with immediate effect,” the answering machine said, according to the Independent. “I must apologise for the nature of this call. I would have preferred to have done this on a face-to-face basis. On the time scale available, this has not proved possible.” (Hat tip to CNN for the headline – SMS 4U: U R sacked.) And if that wasn’t enough: “Unfortunately there are effectively no funds available to pay the salaries for May,” the company added in another message. – Bloomberg
