Why Businesses Need Outplacement Services with Holly Smevog

How do businesses know when outplacement services might be necessary or helpful?

Letting employees go is an uncomfortable and stressful experience. Outplacement services are a way that companies can show they care about their employees, even the ones they need to lay off. Medium-sized and large companies are likely to include outplacement in a standard separation package, and with the lower costs of outplacement more recently, this service can be accessible to all. For companies that believe that an investment in their culture and reputation will pay future dividends and help attract and retain the best talent, outplacement is an investment that pays back many times.

How does helping terminated employees move forward with their careers benefit the company they are leaving?

When outplacement is done well, the departing employee is much less likely to speak ill of the employer. This can keep a company’s reputation intact. Online platforms such as glassdoor.com influence the entire workforce’s opinion of an employer by sharing “internal” perspectives on company culture. Because workers who receive outplacement are more likely to land on their feet with a new job sooner, they spend less time focused on the negative experience they just went through.

Additionally, when a worker is let go, the former team is impacted. Remaining employees may wonder if they are next in line. If they see that laid off coworkers are treated humanely and with respect, team morale is more likely to stay high.

What can employers and employees expect from an outplacement provider? How does their presence change the communications between the company and former employee?

As soon as outplacement service has been activated, the provider will reach out to connect with the laid off employee. At this point, conversations between the employer and the laid-off worker are complete. The outplacement firm helps the employee shift focus toward the future.

Many outplacement firms will initially evaluate the employee’s needs and goals in a face to face (or zoom!) meeting. The firm will assign a dedicated career coach, like myself, who partners with the employee throughout the transition. The coach will meet with the employee regularly and guide them through a process that typically includes goal setting, development of a new resume, a LinkedIn profile update, job search tactics, interview preparation, and negotiation skills. In my experience, over 80% of workers who engage in this process land a new job within 3-6 months.

How should employers plan for layoffs or budget for outplacement services?

Many companies evaluate outsourcing partners as part of an overall talent strategy. Typically, Human Resource departments lead such efforts and will budget for outplacement on an annual basis, based upon projected turnover rates. In the unfortunate event of a large upcoming lay off, including a line item for outplacement service costs reflects thorough financial forecasting.

Outplacement services are often provided on a “per employee” basis. In such a case, budgeting during a normal year can be projected based on historical turnover rates. For very large companies who are considering large layoffs, some firms offer “project based” outplacement services to help the company negotiate all aspects of such a sensitive event.

Is it possible for former employees to turn down outplacement services? Why might they choose not to accept career help from their previous employer?

Yes, outplacement is optional. Some employees may choose to perform their own job searches or may be well along the path toward a new job.