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A Tale of Two Layoffs

Navigating workplace change is never easy. For many of us, our job is our identity. When you lose that, it’s crushing. That’s why events like mergers, restructuring, and layoffs drive turmoil even among employees who are not impacted.

The announcements of layoffs at Twitter and Stripe, in the same week, provide a sharp contrast on how to manage this issue. Both businesses cut headcounts to grow profitability, but they took very different approaches.

For weeks, speculation was brewing about layoffs at Twitter. It’s been reported that close to 50% of the employee population was impacted. When the day arrived, impacted employees were notified not by phone call or meeting, but by email to their personal accounts. Their corporate email was deactivated. They were told they’d receive severance details by the end of the week (which seems to be 60 days’ salary in lieu of notice). And don’t come into the office. You’ll get instructions about returning company equipment later. There was also a reminder that while you’re still an employee, you’re required to comply with the Code of Conduct and corporate policies.

The following week, some separated employees were asked to return to Twitter—they’d been laid off by mistake. Oops.

Compare this to the announcement at Stripe, a digital payments provider. The CEO, Patrick Collison, penned an email so clear, accountable, and empathetic that it raises the bar for downsizing communications.

He starts out with the bad news: the employee population is being reduced by 14%. No need to scan all the way down to the bottom; he leads with the headline. Then he provides “the why.”  Shifts in the global economic climate require the company to be leaner. He outlines a comprehensive exit package that includes severance, 2022 bonus, PTO payout, health care, and career support. He says the people leaving “will be fantastic additions at almost any other company.” 

And then he does something I’ve never seen before: he details two mistakes the leadership team made in underestimating an economic slowdown and growing costs too quickly. That’s accountability. The rest of the letter is about what comes next and why the business will be well-positioned for the future.

Which type of announcement would you prefer if you were being let go? Which company seems like a good place to continue your career?

When the dust settles and both these businesses move to the “new normal” people will talk about how it all happened. A detailed communication and change management plan increases the chances that employees will trust and be engaged following a significant business event.

Accountability, transparency, and a view of what comes next make the transition easier for everyone. But what employees will remember is compassion and empathy.