A 4-Step Guide to Layoff Preparedness for Business Leaders
August 25, 2025
By: Colleen Murphy, PHR
Deciding to reduce your workforce is an unpleasant realization followed by a long task list. How leadership responds to the strategic planning process and supports remaining employees is crucial to the success of a smooth transition after layoffs.
Step 1: Analyze Your Current Workforce
Consider how your organization currently operates. Review department and team responsibilities, functions, and overall output. Ask yourself the following questions:
- Are there overstaffed departments?
- Are there high performers who can accept additional responsibilities and project work?
- Are there low performers who impede success?
- Are there functions that may be outsourced?
If you are unable to satisfactorily answer these questions, there are several best practices that can help you determine the effectiveness of your organization. Tools that may help determine effectiveness include:
Step 2: Prepare the Necessary Documents
Layoffs are never an easy undertaking. Being unprepared can cause significantly more challenges for all involved.
To prepare, consider these items for those departing:
- Early retirement offering
- Severance arrangements
- COBRA documents (if applicable)
- Communication strategy
The other documents necessary to prepare post-layoff include:
- A new organization chart
- Updated job descriptions
- Internal and external communication plans
- New or updated standard operating procedures
Step 3: Communicate to Employees and Stakeholders
Share the facts only when delivering layoff news to your employees. Create a task force to help channel communications to employees and address frequently asked questions.
Vendors and customers also need to be informed about any layoffs through a standard means of communication. Tell vendors if there are contact changes. Customers appreciate thoughtful, proactive communication rather than hearing layoff rumors elsewhere.
Step 4: Follow Up
Following up with the remaining employees is important — yet sometimes overlooked. Managers and other leaders should increase their touchpoints with employees and ask thoughtful questions to see how they are doing. Providing an outlet for employees to share feedback or questions is another effective way to show the organization is willing to hear from employees during this transition period.
When Layoffs Are Required, Help Is Available
Companies may find it necessary to reduce their workforce or restructure their organization when pressed with business, financial, or broader economic challenges. Amid these challenges, companies must answer difficult questions and run through a long list of tasks.
Garnering support from external experts provides a broader view to handling what is, many times, uncharted territory. How you offboard someone is equally important as how you onboard them. We can help.
