Decoding the right PR exercise for mass layoffs

Meta, Twitter, BYJU’S and Unacademy recently downsized their workforce. How must brands sensitively communicate this decision to their stakeholders?

11,000 from Meta, 3,700 from Twitter, 2,500 from BYJU’S and 350 from Unacademy. These are the number of employees who have been rendered unemployed over the last one week from these respective companies.

There is no doubt that this is the season of layoffs. For any organisation, there is no easy way to tell its employees, ‘You’re fired!’ A few obvious reasons to lay off employees include cutting costs and avoiding duplication of resources. However, what employees don’t like is the way companies, both Indian and global, handle such situations.

In October, BYJU’S - The Learning App, one of India’s top ed-tech companies, laid off about 5% (2,500 employees) of its total workforce. CEO Byju Raveendran, in an internal letter to the employees, said, “I realise that there is a huge price to pay for walking on this path to profitability. I am truly sorry to those who will have to leave BYJU’S, it breaks my heart too…”

Raveendran added, “Some business decisions have to be taken to protect the health of the larger organisation and pay heed to the constraints imposed by external macroeconomic conditions. What others see as ‘layoff’, I only see as ‘time off’. Bringing you back by putting our company on a sustainable growth path, will now be the number one priority for me.”

Talking about profitability, while laying off employees, who put their heart and soul into their work, may not be the wisest thing to do. At the same time, mentioning that it is not ‘layoff’, but just ‘time off’ also raises concerns. 

A few days after sacking its employees, BYJU’S appointed Lionel Messi as the first global brand ambassador of its social impact arm, ‘Education For All’. Roping in the global football icon must have been quite expensive for BYJU’S. Communication industry experts see this as a PR blunder, backed by extremely poor timing. 

“You don’t hire a brand ambassador, right after firing tons of people,” remarks Tarunjeet Rattan, managing partner, Nucleus PR. She says that such organisations erode the trust of people, who are working with them, have worked with them in the past, and also the ones who could possibly work with them in future. “The brand’s trust bank has been eroded drastically because of this announcement,” Rattan adds.

Speaking about how PR and communication professionals should deal with extremely sensitive situations, like layoffs, Archana Jain, managing director, PR Pundit, says that any change that impacts a stakeholder of an organisation, needs to be managed sensitively.

“Reputation is never impacted as much by this as it is by the absence of strategically considered and timely communication. During a crisis, a company’s credibility is rated based on the degree of openness and honesty, the fairness of its actions, and the empathy displayed,” Jain states. 

Indian startup brands that laid off their employees in the recent past, also include Ola, Vedantu, Blinkit, to name a few.

Akshaara Lalwani, founder & CEO of Communicate India, points out that the current business climate is full of challenges. It is now more important than ever to have the right PR and communication professionals to put out the right sentiment.

As per Lalwani, “Layoffs have largely impacted organisations and brand equity of companies. However, this is where communication plays an important role. It matters what you say and how you say it. Additionally, it is imperative to have the right PR measures in place, when dealing with tough situations.”

Sugar-coating the bad news isn’t a good idea. Neither is firing people over a Zoom call or a social media post. The internal and external communication teams of an organisation need to work together to ensure a smooth process. 

Brand consultant and communication strategist, Arun Mittal says that the role of the PR person is to provide sound counsel to the Founder/CEO on how to deliver the news because the way people are terminated can impact not only a brand’s reputation in the marketplace but also its relationship with those who remain, and who will be responsible for its future growth.

"In the age of Glassdoor, the news and stories employees tell about this event will live online for years to come. To lessen the impact, brands should craft effective internal platforms giving the remaining employees a constructive outlet to share their concerns, questions and ideas about the transition—perhaps via recurring, cross-functional discussion circles with the C-suite," adds Mittal.

Rattan of Nucleus PR takes the recent example of Twitter. The social media giant first fired its employees and then, asked them to join back by stating that they were ‘laid off by mistake’. Such kind of blunders, as per Rattan, were easily avoidable if only Twitter believed in the mechanism of PR. “How well the company communicates it (the layoff decision) is directly proportional to how quickly it will come out of such a situation.”

On November 9, social media platform Meta announced its mass layoffs to reduce costs, following disappointing earnings and a drop in revenue. CEO Mark Zuckerberg, in a detailed blog post, explained the specific reasons behind the decision. He accepted his fault and said that he got it wrong.  

“We will give 16 weeks of base pay, plus two additional weeks for every year of service, with no cap,” Zuckerberg said in a message to employees. The company will be paying for all remaining paid time off (PTO), and cover the healthcare cost for the laid off employees and their families for six months. Meta will also provide three months of career support with an external vendor, including early access to unpublished job leads to the impacted employees.

Lalwani of Communicate India states, “It is important to be respectful and take things through a formal and procedural route. HR must be roped in to help find alternate packages, and provide severance pay to the laid off employees. The company must control the narrative, as far as the press and public go.”

Downsizing impacts not only the ones who are laid off, but also the morale of the ones who’re retained. What can be done to make sure that brands quickly emerge from this situation?

Elaborating on the role of an organisation, Rattan mentions, “If the internal and external communication are working on the different ends of the spectrum, with the HR team just lost in between, it is a perfect recipe for disaster. Companies also need to speak to the people, who are left behind.” 

Jain of PR Pundit says that layoffs have happened across generations. The communication around them needs to be planned and orchestrated mindfully. “The employees, who haven’t been laid off, have to be taken into confidence to minimise speculation and impact on productivity.”

Mittal believes that by institutionalising an ethic of care, which emphasises responsibility and compassion, PR professionals can enable relationships to provide value to those inside and outside the organisation.