Is the Company Following the Principles of Dignity, Dollars and Destiny?
5/20/19 – – Having lived in the Detroit area during the 1980s and ‘90s, some of the toughest years for the U.S. automotive industry, the headline on an AP article posted today brought back troubling memories: “Seeing a twisting road ahead, Ford cuts 7K white-collar jobs.”
While the announced workforce reductions will be worldwide, the story pointed out that southeast Michigan will be hit hard: “About 500 workers will be let go starting this week, largely in and around the company’s headquarters in Dearborn, Michigan, just outside Detroit.”
Employment terminations anywhere and of any magnitude are emotional events not only for the individuals losing their jobs but also for the company, families and communities involved. In addition to the inevitable human suffering, serious reputational damage can be done to companies and organizations failing to execute these actions with empathy, clarity and care.
In Chapter 18 of The Crisis Preparedness Quotient – Measuring Your Readiness to Weather a Reputational Storm (“Dealing with Leadership Transitions”), I recommend three principles employers should follow to achieve the best outcome when facing these difficult situations:
DIGNITY – There are few human needs more important than dignity. Strip someone of his or her dignity and you heighten the chances of litigation and send a very negative message to your other employees. Make every effort to treat people with as much respect as possible when you are sending them into unemployment.
DOLLARS – For most people, including those occupying the C-suite, losing a job is a jolting emotional and financial event. Providing no safety net unnecessarily creates a very unpredictable, desperate person. No company has an unending responsibility to pay former employees. But my experience is that a reasonable amount of money paid at separation goes a long way toward making things go smoothly, keeping things out of court and avoiding a crisis-triggering event.
DESTINY – Another first principle in handling terminations well is to get everybody moving forward, looking ahead. You want a parting employee’s focus to be on his or her future. Providing such services as outplacement counseling is a good way to help individuals get about the business of finding a new job.
In the AP story we’re not given much information regarding the buyouts and separation agreements Ford is offering the departing employees. So, we can’t judge Ford’s attention to dollars or destiny. But there are indications that the company is bucking HR orthodoxy to maintain a welcome level of dignity:
Hackett (Ford’s CEO) said in the memo that Ford is departing from past practices and letting laid-off employees stay a few days to wrap up their jobs and say good-bye to colleagues. In the past, laid-off workers would have had to pack up and leave immediately.
“Ford is a family company and saying goodbye to colleagues is difficult and emotional,” Hackett wrote.
Kudos to Jim Hackett for this show of respect and empathy for those departing and staying on with Ford. The way a company handles a workforce reduction says a lot about its character. And you can be certain that during these trying episodes, a company’s employees, communities and investors will be listening.