In our last blog post we took a look at skills gaps that are impacting industries including healthcare, making it difficult to fill key roles. Here we take a look at a seemingly contradictory trend in healthcare: layoffs.
Becker’s recently reported on a number of hospitals and health systems that are reducing staff due to both financial and operational challenges including most recently Southwestern Health Resources in Farmer Branch, Texas, and Steward Health Care in Dallas.
Just last week, two of my clients told me of reductions in force (RIFs) due to financial constraints.
It’s a strange dichotomy in light of the staffing challenges that the healthcare industry also faces. But it’s a factor of shifting talent needs and emerging technology that is having an impact on the demand for certain roles. It’s a dichotomy that represents communication challenges as healthcare leaders navigate the needs of both employees leaving the organization and those they hope to keep on board.
One must have: transparent and honest communication.
Must-Do Mandates During Layoffs
Properly managing layoffs is critical for maintaining engagement and preventing turnover among remaining staff. In addition, ensuring that employees remain committed to quality, safety, and service will minimize the risk of errors and ensure positive outcomes.
But, how can you make that happen?
The “success” of any layoff can be measured by the ability to maintain engagement and productivity among remaining employees. Doing that requires a concerted and coordinated effort from the top down with a visible commitment to transparency and ongoing communication. In addition, opportunities for two-way communication are important with a commitment to ensuring responsiveness to employees when they have questions and concerns. Here are some key points to consider when layoffs become a necessity:
- Share the “why.” It’s important to explain to employees why layoffs are necessary. For instance, Healthcare Financial Management Association (HFMA) has indicated that 84% of health systems cite lower reimbursement from payers as a top cause of low operational margins. Rising labor costs have been cited as another major factor.
- Be transparent about what is happening and how decisions about layoffs are being made. Be clear about how these decisions will be communicated. Focus on ensuring employees that layoff decisions were not random, but well thought out and based on objective criteria.
- Offer opportunities, training, and support for impacted employees to seek other internal opportunities—or to prepare themselves for roles outside the organization.
- Ensure that communication is ongoing and consistent across multiple channels from senior leadership to frontline managers while providing opportunities for staff to ask questions.
- Don’t underestimate the power of appreciation to help employees handle the stress and challenge of layoffs.
Throughout the planning and implementation process for a layoff, it’s important to provide honest reassurance to employees who have not been impacted. One of the risks in a layoff situation is that top talent will seek opportunities elsewhere out of concern for future impacts to their own jobs. Helping them navigate this change is critical.
It’s also important, of course, to ensure that impacted employees understand how and why decisions were made and receive to support to find new positions internally or externally through outplacement services and opportunities for training and development. Even though they’re leaving now doesn’t mean there might be an opportunity for them to return in the future. Keeping the door open through transparent and supportive communication helps to support your employer and healthcare brands.
Need help managing the complexities and uncertainties of a layoff decision? Baird Group can help.
Tags: downsizing, employee layoffs, employee relations, managing layoffs, offboarding, reductions in force, rightsizing, turnover
