By Michelle R. Fearn, CHRP 

 In the aftermath of Lay Offs, Freezes, and Salary Cuts

With many companies being forced to make cuts in salaries and staffing levels in order to survive our current economic downturn, a new challenge presents itself to HR professionals everywhere.  This challenge comes in the form of low employee morale, which for many, has reached an all time low. 

Whether your company has been faced with the unfortunate necessity of implementing lay offs, salary and / or hiring freezes, or salary cuts, a decrease in employee morale may naturally follow.  HR professionals will need to be prepared to take pro-active steps by developing methods and programs for meeting these challenges in these tough economic times. 

Maintaining positive employee morale following lay offs starts at the top. The key success factor in achieving this is effective communication and re-assurance from management. Employees are often riddled with questions during these times, so maintaining frequent, open, and honest communication about the situation and the future direction of the organization will be key to keeping a bad situation from getting worse.  Employees will wonder, 'Am I next?' or 'What is going to happen to me?'  Although nothing is ever guaranteed, it is important for employers to recognize these fears and to anticipate these types of questions in order to address them as honestly and openly as possible. 

The Trust factor - Employee layoffs are often followed by a loss of trust towards the employer and employees may be left wondering whether there could be underlying motives at play.  Some may have had a close friend or family member laid-off, or they may be worried their job is next in line for elimination. Employers need to be sensitive to layoff survivors and make a conscious effort at re-building that trust level and focus on building a stronger team with those who remain after the lay-off.  This again starts with communication.  Hold a staff meeting immediately following a large layoff.  Provide an overview of the circumstances that necessitated the layoff, the company's current status, and the corporate game plan going forward.  Be as open, honest, and frank as possible.   Employees need to feel a sense of security by knowing the company does have a game plan and that the layoffs were well thought out. Re-building trust will depend on how information is communicated from the top going forward. If employees feel like something is being hidden from them, they may become more guarded and less open to change making it more difficult for the company to succeed. 

How can you as an employer help make a positive change in employee morale?

• Communication - Conduct regular staff meetings and keep employees apprised of the company's status, as well as new corporate strategies that may be in place.
• Be forth coming - The news may not always be good, but there is something to be said for providing the truth - the good, the bad, and the ugly.  Many times poor morale is simply a result of being misinformed or not informed at all.
• Employee Involvement - Get staff involved in the decision making process by providing them with optional solutions to a problem and the opportunity to provide their own input.
• Increase non-Monetary Recognition - Non-monetary recognition is just as important as the kind that fattens the paycheck, and can send a very powerful message to the employee. Things such as a special note from the CEO acknowledging a special contribution he or she has made, lets employees know their contributions to the company are valued and their efforts have not gone un-noticed.
• Team Re-Building - Team dynamics will change following large lay off so spend some time re-building those new teams and recharging the energy. Everyone wants to be part of something and spending the time to develop your new teams, will only strengthen the company to prepare for the rough road ahead. Try assigning a special project or task to a designated 'team', on an initiative that fits in with the new corporate mission.  By working together to produce a finished product that coincides with the new corporate mission, employees may feel 
• Attitude comes from the top - You've heard your parents teach you to lead by example right?  Well, in the case mother was right!  By exhibiting a positive healthy 'can-do' attitude, employers can help employees to better focus on achieving success and not failure. When faced with a challenge, attack it head on and ask 'how can we make this better', rather than assuming defeat with a 'this can't be done' attitude.  This positive approach to problem solving and day-to-day activities will hopefully have a trickle down effect throughout the organization.

Employers remember, poor morale does not happen over night and will likely take some time to correct, but the effort you put in now, will pay off in the long run.  For more thoughts or suggestions on how to improve overall employee morale, please contact your Human Resources professional for assistance. 

Good luck and stay positive!

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