Layoffs unnecessary? Survey reveals half of employers regret cuts
The survey found that 31% of business leaders said that performance is always a factor in layoff decisions.
Layoffs might not be as necessary for cutting costs as was once believed. According to a new survey by ResumeBuilder.com, half of business leaders admit that 75% or more of the layoffs at their company in the last year weren’t necessary for the budget.
Layoffs might also happen more frequently than expected, with 63% of companies revealing that they have laid off employees in the last year. Of those layoffs, 80% of business leaders said their company chose to layoff an employee rather than firing them. According to the study, a top reason cited for hiding termination decisions behind layoffs is to maintain company morale.
The survey found that 31% of business leaders said that performance is always a factor in layoff decisions.
Additionally, the survey highlighted an emerging trend as more companies enforce strict return-to-office (RTO) policies with the hope of indirectly encouraging employees to leave the company voluntarily, rather than carrying out layoffs or terminations.
“This lack of transparency is further highlighted by our survey, which indicates that numerous companies use layoffs as a cover for firing employees who are underperforming. Instead of addressing performance issues directly, these companies cite cost reductions as the reason for layoffs, obscuring their true motives,” said Stacie Haller, Resume Builder’s Chief Career Advisor.
In addition to keeping company morale high, business leaders said their organizations were motivated to disguise performance-based terminations as layoffs in order to avoid wrongful termination claims, providing severance and hurting employees’ feelings.
Read more: Employees willing to make sacrifices to avoid job loss
“Managers need more training on how to work with employees to avoid termination and how to carry out firings in a legal, ethical and professional manner. Particularly with younger managers who are relatively new to their roles, layoffs may seem like the easier option without the potential legal repercussions that a firing may bring. Managers need more training to handle performance issues directly and transparently, fostering a more ethical and effective approach to workforce management,” said Haller.