As the CEO of a company that is in a slump, you know that your only option may be to lay off a percentage of the staff. Maybe the business was growing consistently, so you kept expanding the workforce. But due to a recent decline, you need to drop about five or 10% of that workforce just so that the company can make ends meet.
You know that you are probably going to face personal challenges from some of the employees. They will not be happy about being laid off and they may feel that they didn’t do anything to deserve it. But are you going to any legal challenges, or is it legal for you to go forward with the layoffs, even if the employees aren’t happy about it?
The process must be fair
In a big-picture sense, layoffs are legal. The government does not prohibit you from cutting your staff for financial reasons. This is something that happens all the time, across many industries.
That being said, the key thing to remember is that you need to do this in a fair manner. The layoff needs to equally impact everyone within your workforce, especially those who are in protected classes.
For instance, if 80% of the workers who get laid off are African-American, they may claim that they are facing racial discrimination. If the majority of the workers who lose their jobs are women, they may claim that it is gender discrimination. Always review the workers you intend to lay off to make sure the process doesn’t target one specific protected class.
If you do run into legal complications or disputes, be sure you know what options you have.