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Bare-Naked Layoffs

March 13, 2009
Related Topics: Downsizing, Ethics
Here’s one way companies can avert public relations problems associated with layoffs: disclose, disclose, disclose. As it stands, employers often are not forced by law to admit when they engage in modern layoffs--of the 5 to 15 percent of headcount variety. California is a rare exception, with its notification law triggered by a layoff of just 50 employees. But in an era of Facebooking, Twittering and other forms of electronic self-expression, stories about job cuts are going to be told. “There’s no ability for a company to control the message like they used to,” Jennifer Benz, a San Francisco-based communications consultant, told me recently. She points to, a site that welcomes stories of layoffs. At and, ex-employees also are invited to talk about their old firms. The New York Times recently reported on some 4,600 North American job cuts at IBM. “The cutbacks surfaced only because of their size and timing, with word spread through blogs, employee message boards and [union group],” the Times said. I, for one, back an idea raised in the article: requiring large corporations to annually report employment country by country. “All our multinational companies are increasingly less American, except when they are asking for tax breaks and increased government spending in their industries,” Ross Eisenbrey, a researcher at the labor-leaning Economic Policy Institute, is quoted as saying. “Knowing where their employment really is would be useful information for policymaking.” Whether that rule ever comes to pass, smart firms are getting in front of this issue. They’re disclosing their cuts and explaining them. Examples include online retailer and software giant SAP. The public may not love hearing about more job-loss woes. But people--who include potential customers and future employees--will be much more sympathetic to the transparent company than the one whose layoffs only surface when angry ex-workers vent.

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