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Here’s Why Your Company Should Offer Outplacement Services


When your company is contemplating layoffs, the extra expense of outplacement services can be hard to justify. Of course, offering outplacement assistance is the right thing to do for your displaced employees, but that’s not the only reason you should offer it.

Outplacement assistance can be a valuable part of your company’s standard severance package, because it can save you on unemployment taxes, wrongful termination lawsuits, and damage to your company’s reputation. Employees who use outplacement assistance move on to new jobs faster, and those who remain behind maintain their morale.

You’ll Save in the Long Run.

Layoffs must be performed with care if you want to keep costs down. Displaced employees who linger on unemployment for months will cost you more than those who transition to new jobs within a few weeks. Layoffs can affect productivity and engagement among employees who haven’t yet been let go, especially if they don’t know whether their positions are secure and aren’t seeing the company take care of their colleagues as they transition into new roles.

The upfront costs of outplacement services should be measured against the long-term savings of minimizing unemployment drawdowns, wrongful termination lawsuits, and reduced productivity. The new model of beginning outplacement services within 24 hours of termination means that employees won’t be sitting around at home feeling sorry for themselves, but instead focusing on finding a new job immediately, and taking steps that will make it happen. Employees will be earning paychecks again much faster than they would without outplacement services, so you’ll pay fewer unemployment taxes. Employees who have the support of career counseling and job placement services will feel less resentful and disgruntled, and less motivated to pursue legal action for wrongful termination. If they move quickly into new jobs, they won’t get desperate enough to need the financial compensation that could come from a lawsuit. And if an employee does sue you, the fact that you handled the termination ethically could work in your favor.

You’ll Keep Morale Strong.

Layoffs can have a massive impact on remaining employees, who may be understandably worried about the security of their own positions. It’s not easy to watch your friends and colleagues lose their jobs, and it’s not easy to wonder if your own job could be at risk. Under those circumstances, you almost can’t blame employees for checking out of their jobs, doing the bare minimum until they know their positions are safe, or until they find another position elsewhere.

When morale drops, productivity can suffer, and you can easily start to lose employees you meant to retain to other companies. Offering outplacement assistance shows your remaining employees that you’re committed to supporting them even after they leave the company. Employees might still worry about their positions, and offering robust severance shouldn’t be your own strategy for managing morale among your workforce, but seeing that their colleagues are offered support to transition to new roles will help remaining employees at least feel secure in the knowledge that they won’t be hung out to dry after all they’ve contributed to the success of the company. Once they see some of their former coworkers actually move into new roles and start earning paychecks again, they’ll be even more encouraged.

You’ll Protect Your Brand.

Laying off a lot of people can do a lot of damage to your brand. Even laying off just one person can damage your brand if they take it into their head to spread disparaging gossip online, or take you to court.

Handling layoffs with care, and offering your former employees the support they need in the job search process, shows that you’re really committed to your core company values. When you’re ready to fill positions again, desirable candidates will see that you prioritize employee well-being, and they’ll be more interested in working for your organization.

Outplacement services can do a lot to protect your company’s reputation, keep your remaining employees productive while layoffs occur, and minimize the costs associated with letting employees go. Displaced employees will transition into new roles more easily, and those who remain behind will (hopefully) be even more committed to helping your organization succeed.