How a Reduction in Force (RIF) Effects Your Employer Brand

A reduction in force – and the benefits you offer separated employees – have a major effect on your employer brand.

In our online world, company practices and corporate culture are on display for all to see with sites like Glassdoor, Indeed, and even Yelp. How you handle the reduction in force will be viewed by many. Offering each employee an outplacement package can help you protect your employer brand during a reduction in force. Such an investment has shown to help employees transition more successfully, thereby reducing their stress and feelings of loss.

Here are some of the strategic reasons companies offer outplacement services as an investment in their brand.

Trust in your company will likely take a major hit upon news of a major RIF.

Stakeholders, customers, social media followers, and the local community develop an opinion about how you handle a reduction in force. All of these individuals need to be carefully considered as you create your plan. In fact, the decisions you make (or don’t make) influence the trust these key groups have in you. This includes everything from how you prepare your management teams, take care of your exiting employees, and lead your remaining employees through change.

63% of customers refuse to buy products/services from a distrusted company.1

Likewise, your surviving employees are watching, too. You need their trust to move forward. Open doors and regular communication need to be your mantra. Uncertainty will grow if people’s fears and concerns are not addressed. Furthermore, a breakdown in communication causes teams to lose trust. Ensure leaders are present and transparent to build back confidence in your future direction.

61% of surviving employees believe their company’s future prospects are worse.2

Greener pastures are tempting for remaining employees after a reduction in force.

All of the issues surviving employees face may motivate them to update their resume. These issues include negative emotions, declining productivity, breaks in trust, and dwindling hope. Turnover is costly. In fact, it’s projected to cost businesses $680 billion by 2020.3 Compound this with the institutional knowledge you’ll lose right after a layoff or downsizing.

If you handle your reduction in force in a reputable way, the lure to seek greener pastures can be minimized. Direct investments that display your commitment to doing the right thing – even in the wake of hard business decisions – save your employer brand. As a result, this makes it less risky for surviving employees to remain with your company because they see the future you want to create.

Turnover rates are 28% lower if a company has a reputable brand.4

Customers & future employees are influenced by what they see online.

Did you know 47% of global consumers say they have avoided a company because of its online reputation or negative social reviews?5 A few nasty posts after a reduction in force cause quite a stir. Pay attention to what is being said about your company online. Consider setting up Google alerts with your company’s name combined with words like fired and layoffs. In addition, you can also regularly track review on Glassdoor, Indeed, and even Yelp. Keeping a pulse on this keeps you in front of potential threats.

When you enter times of growth, maintaining a positive employer brand will enable you to attract the best talent. Potential candidates will research you online and review your social media pages. What articles and posts will come back to bite you? Investments in your employer brand now conveys the right message to your future employees.


IMPACT Group helps some of the nation’s biggest logos protect their employer brand during a reduction in force.

Our outplacement services mitigate risks to your employer brand by preparing you to make RIF decisions, deliver a compassionate message, empower exiting employees, and lead company recovery. Get a copy of your SMART and Compassionate Guide to Reducing Your Staff to start planning now.

1 Stakeholder Trust: A Business Case, Compliance & Ethics
2 Don’t Expect Layoff Survivors to be Grateful, Mark Murphy, Leadership IQ
3 National Employee Retention Report, Work Institute
4 Global Recruiting Trends, LinkedIn Hiring Solutions Insights
5 How Public Perception Can Make Or Break a Brand, And What It Means For Employees, Forbes