How To Deliver Bad News To Employees

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No one wants to do it. But like death and taxes, it is a fact of life. Every now and then you are going to have to share bad news with your employees. Sometimes it is bad news for one employee such as a termination, this can be difficult too, but with some of the best PEO companies in California out there (for example) it can be made a lot easier. For this post though we will be focusing mainly on what to do when delivering bad news to all of your employees.

Maybe you lost a massive contract? Had a customer suddenly cancel on you? Or are facing shutting down the company entirely?

It’s difficult for both parties, but the bad news skill needs to be shared. So what is the best way to tell employees bad news?

Prepare To Deliver The Bad News

How To Deliver Bad News To Employees - Prepare

Words can sometimes struggle to find themselves when you are sharing bad news with employees. So don’t leave it to chance. Even if you have to tell a group of people about the redundancy process, take a few minutes to jot some points down so that you don’t forget to cover any point you planned to. You can also get help from HR consultants who have experience in redundancy issues and have given advice to hundreds of employers. For example, Sentient provide advice to employers on redundancy, health and safety, and other issues concerning employment law. Consider getting help from such professionals to avoid the communication struggle.

Be Upfront & Honest When Delivering The News

No one likes holding their breath waiting for the hammer to drop. Don’t fill the start of your speech with a heap of fluff and leave your employees hanging. They can sense bad news coming, and all you are doing is increasing their anxiety.

The best approach is to be upfront and honest. Tell your employees what has happened and be as transparent as you possibly can be. Beyond that try and anticipate what rumors may surface and put to bed any issues before they can arise.

Be Sincere & Understand The Impact of Bad News

How To Deliver Bad News To Employees - Sincere

If you do have to lay off staff, close down a department, move an office make sure you recognise the impact that this will have on the lives of these employees.

If they see senior management still hoping in limo’s and flying business class while cutting jobs it won’t be a great look. Exhaust the other options you have first and show staff how this really was a last resort.

It won’t necessarily help. But at least they will know you have tried. If the company has the time and resources to do so any support you can provide in terms of assisting with job hunting or lining them up with other people employers would be greatly appreciated.

Offer a Plan For The Future

If the news is bad, but not bad enough to close the company, offer the employees a plan for the future. People can and will back you, if you provide a credible plan that shows a way forward for the company.

Management must believe in this plan and be 100% behind it, otherwise employees will see through the charade and notice that while management are asking them to stick around, and they are all bailing into new jobs.

Timing The Announcement Of Bad News

How To Deliver Bad News To Employees - Upfront

While you can’t time all bad news you may have some control over it. First and foremost you owe your employees as much notice as you can possibly allow for. While the law may only require you to give x weeks’ notice, these are the people who help build the company. If you can give them a longer period of notice, then you should.

In addition to that try and avoid holiday periods or the end/start of the year. Typically these are periods of celebration and no one wants to go into a holiday period worrying about how to pay their bills.

The other key consideration when it comes to timing is to make sure that everyone is told at the same time. You don’t want news to leak and people to find out from second hand accounts, or worse yet, the media, rather than the management team.

Manage The Aftermath

After sharing bad news with your employees it is important that you give them the opportunity to ask questions, both publicly and privately. Some employees may prefer to talk to you behind closed doors, while others will want to air their questions in a public forum.

Expect that some employees may be disgruntled and choose to react in a way that is different to their usual demeanour. Now is the time to listen to their point of view so don’t take this as a personal attack or engage in a back and forth argument on the matter.

During this process you should reiterate how the company plans to assist during this time and invite further feedback and input during the process.

While its never nice, nor easy to share bad news there is no way to avoid it forever. Make sure you understand the message you need to convey and be as open and honest as possible. This won’t make people love what you have to say, but it may at least help them come to terms with the issue and what has resulted in this happening.

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About Author

Paul Towers - Founder @ Task Pigeon

Paul Towers is a 3x Entrepreneur and Founder of Task Pigeon. Join me on my journey to build an open & transparent startup from day one. Paul is also the founder of Startup Soda, a newsletter curating the best content from the Australian startup ecosystem.