The massive economic downturn induced by COVID-19 has forced business leaders to make some tough financial decisions. One of the most challenging decisions is whether a layoff is necessary.
Layoffs take a personal toll on the employees affected, and a cultural impact on the remaining employees. While doing a layoff is a tough business decision, there is a right way to do them – with compassion, dignity for others, and professionalism.
There is also a wrong way to do a layoff. This leads us to the story of Bird, the once high-flying unicorn provider of scooters. On March 27, Bird sent out a Zoom meeting invitation for a 9:00 AM meeting.
Zoom meetings were a common communication tool for the 1,000+ organization. Problems began to immediately surface when employees noticed that the Zoom meeting invitees were not the entire organization – the invite was only sent to a select number of people. How many – no one could tell.
Bird employees began frantically reaching out for more information on Slack. No one was sure what was going on. Some people were invited to the Zoom meeting; others were not. What did this mean?
When the meeting time arrived, here is what happened according to a post from dot.LA
At 10:30 AM, employees logged onto Zoom but were greeted only by a cracking silence. Meetings at Bird are usually always punctual, and more frenzied Slack messages followed.
For the next five minutes, employees stared at a sparse slide with a dark grey background that said only "COVID-19."
Thinking there were technical difficulties, some employees logged-off and were never able to return to the meeting. Then, after five minutes of dead air that seemed like an eternity, a robotic-sounding, disembodied voice came on the line.
The woman began by acknowledging, "this is a suboptimal way to deliver this message." Then she cut to the chase: "COVID-19 has also had a massive impact on our business, one that has forced our leadership team and our board of directors to make extremely difficult and painful decisions. One of those decisions is to eliminate a number of roles at the company. Unfortunately, your role is impacted by this decision."
The meeting was scheduled to last half an hour but ended up going for only two minutes. Towards the end of the monologue, as the woman started talking about the future of Bird, she sounded like she was getting choked up and was trying to hold back tears.
Almost no one recognized the voice, and there remains disagreement about who had the unfortunate job of delivering the message. But this much is clear: It was not Travis VanderZanden, the CEO or any other top executive.
After the two-minute call, somewhere between 30 to 40% of the employees were unemployed. Their terminations took effect immediately.
Here is a what the layoff message said:
Their computer access was immediately closed, meaning they had no way to get any personal contacts, photos, or anything else. To make a bad situation even worse, the employees were all immediately escorted out of the building. They were not allowed to return to gather any of their personal belongings because the COVID-19 restrictions for workplace entry had begun.
Did Bird follow up this disastrous mass layoff with a personal outreach to all of the impacted employees? I think you know the answer to this question.
According to Bird's statement, "HR representatives, managers, and/or executives personally reached out to all individuals directly as a follow up." But few employees have seen any follow-up. It did not help that many managers were included in the layoffs and had no idea who on their team had been cut. Some resorted to messaging their reports on LinkedIn to see if they still worked at the company.
The next day, one employee received what seemed like a heartfelt note of gratitude from his boss's boss thanking him for what he had contributed during his 18 months at Bird, but he soon discovered he had gotten a form letter. "Seven of my contemporaries said they had received the exact same message," the employee said. "I realized he had just copy and pasted it."
There is a lot to unpack with this story regarding everything that was done wrong with this layoff. Here are the lessons that every HR Leader can learn.
Layoffs Need To Be Done With Compassion and Dignity
Losing a job is as personal as it gets – the loss of income, pride, and security are significant. The job loss impacts not only the employee but also their family and loved ones. There is no way to minimize or depersonalize ending someone's employment.
Layoff Notifications Need To Be Delivered Personally
Being told that you have lost your job in a group setting is crushing. Everyone deserves to be treated respectfully with a personal meeting where the employee can hear the news directly from their boss or someone in leadership.
Leadership Needs To Be Shown
In the case of Bird, their leadership has created a high-flying unicorn that became the fastest company in history to reach unicorn status. The company's valuation peaked at an astounding $2 billion valuation, and it was widely recognized as one of the most attractive startups to work for. Leadership was highly visible during good times. The company had bi-weekly all-hands-on-deck meetings where the leaders could brag about the next milestone achieved by the company.
Where was their leadership when Bird has to layoff nearly half of its employees? They hid behind the scenes and delivered the devastating news with a generic/unknown messenger. This absolutely can never be done.
Layoffs Impact The Entire Organization
A layoff impacts everyone in the organization – obviously those leaving, but also those who stay. How do you think the Bird employees feel about their leadership and their job security after the mass firing? Leaders have to be seen and accountable in tough times. Bird, like many companies, is getting rocked by the COVID-19 crisis. Strong leaders will get in front of everyone and explain what the company is doing, why they are doing it, and how they will get through the crisis together. Sadly, this was not done at Bird.
I hope that we will soon be seeing the end of the social distancing that has ground our economy to a halt. Unfortunately, I believe that there will be layoffs that will result from the economic devastation taking place. While I hope that this will not impact you, I also hope that you will be a leader who will show compassion and courage.
Here is a link to the dot.LA article on the Bird layoffs: 'It Felt Like a Black Mirror Episode' The Inside Account of How Bird Laid off 406 People in Two Minutes via a Zoom Webinar