The Etiquette of Making Layoffs: 7 Ways to Make Staff Cuts Less Painful

As horrible as it is, whether you simply can’t afford to cover payroll costs or an employee just isn’t working out, handing out a pink slip usually becomes a necessity at some time for every small business owner.

Make no mistake: Laying off an employee is always a dirty and difficult job. Still, you can take steps to ensure that the process is as painless as possible for everyone involved. Here’s how to handle a layoff situation with grace.

1) Give the bad news quickly and all at once. Letting people gossip and worry about who’s next on the chopping block will crush company morale. If you know you need to make cuts, do them all at the same time, and make it clear to your remaining employees that their jobs are remaining intact.

2) Don’t fire by email. You wouldn’t break up with someone by email (hopefully), and it’s not the way to terminate an employee, either. If your employee is remote, schedule a phone call to discuss the termination. Otherwise, meet with each staff member personally on the morning of the layoff.

3) Make it about the position, not the person. When speaking to the employees that you’ll be laying off, be careful not to make it personal. Don’t tell them “we’re terminating you.” Explain that the roles they’d filled are being eliminated, whether due to budget cutbacks, redundancies, or another reason.

4) Don’t say, “I know how you feel.” You don’t: You still have a job. Be kind, but keep your distance.

5) Help with job assistance if you can. If your employees weren’t terminated due to poor performance, do whatever you can to help them land on their feet somewhere else. LinkedIn provides several no-cost ways to help: You can create glowing references for your former staff, and forward their profiles to anyone you know who may be hiring.

6) Give them time to say goodbye. If the terminated employees have been with the company for a while, they’ve probably developed close friendships with fellow staff members. Accept the fact that no one’s going to do much work on the day of a layoff, and let them say their goodbyes around the office as they collect their possessions. Give the remaining employees permission to leave work early so they can go out for a farewell beer with their former co-workers.

7) Get back to work. Once the terminated employees have left, the rest of the staff will be looking to you for guidance on moving forward. Hold a staff meeting focused on upcoming goals, giving each team member a new and specific role to focus on, even if it’s a token job. This will help motivate your staff to focus on the future, rather than dwelling on the past.

About Kathryn Hawkins

Kathryn Hawkins is a principal at the content marketing agency Eucalypt Media. She's written about business, marketing, and entrepreneurship for publications including BNET,,, and owns and operates the positive news site Gimundo. Follow her on Twitter at @kathrynhawkins.
This entry was posted in Employees and tagged , , , . Bookmark the permalink.


  1. [...] economy or not, at some point in your career, you’ll probably have to downsize your team by going through a layoff process. Priorities change, external factors drive companies in a [...]

  2. [...] As devastating as layoffs are to the people who lose their jobs, “layoff survivors” and the businesses for which they still work face formidable challenges as well. While corporations are better-positioned (and have more resources to fall back on) following a layoff, for small businesses, the loss of veteran employees can add to post-layoff turmoil. So it’s vitally important that small business owners take proactive steps to keep things running as smoothly as possible. How a business manages its remaining employees after a layoff can mean the difference between a short-term setback and long-term struggles. [...]