Today are more layoffs at Yahoo. 1,500 to potentially 2,000, some say.
Days like this make me wonder what I would do if my business had to lay off employees. I tell myself, “I wouldn’t lay anyone off. I would hire slowly and grow only as fast as we’re capable of, so we don’t end up with a glut of resources.” I know that’s not always easy, but growing too fast can be disastrous for some companies.
Then, if finances were still really tight and I’ve made other budget cuts already, I’d cut my own pay first. If we still needed more, I’d cut bonuses. Then I’d ask the leadership team if they’d be willing to take a pay cut. Finally, I’d ask everyone else if they’d be willing to take a pay cut. I would explain that we value everyone and want to keep everyone, so rather than eliminate jobs, we’d rather decrease salaries temporarily. The key point is temporary – as soon as revenues are back up, salaries will return to their previous levels. Or maybe even higher.
Is that realistic? Some companies have done this with apparent success. But there will be a few employees who will inevitably leave because of personal financial concerns, such as mortgages and bills. They live paycheck-to-paycheck and any decrease in pay is a serious economic issue.
To try to reduce that, I would explore the possibility of finding contract work for them. Basically, I’d turn my company into a consultancy and hire my employees out, if they’re willing and able to. I would need to keep a percentage of that revenue for overhead expenses, but the vast bulk would go into their pockets. There may be some tax and legal implications though, which I’d have to work out with my attorney and CPA.
The end goal, though, is to keep everyone with the company. No lay offs, no loss of jobs.
Realistic? I think so, though it’s probably difficult to execute. This is just me thinking out loud. I haven’t had the ill fortune of making such a decision, so I don’t know what I’d really do.
In any case, here’s my virtual “pour one out for my hommies.” Good luck, guys.