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Tips For Assessing Your Layoff Risk

Updated on November 5, 2011

Calculating Your Risk

Am I just a number to my company?
Am I just a number to my company?

Factors Affecting Layoff Risk

In today's layoff beliegered economy, it does well for employees to consider how they stack up to the "competition" in their own companies with respect to the corporate chopping block.

A variety of factors come into play when a company is considering who to cut in these hard times. These factors go well beyond simple employee performance.

Unlike the "Employee Handbook" one is often issued when hired for a company, there is no "Layoff Handbook" for exiting employees. Howsoever, that does not mean companies do not keep detailed statistics and demographics about layoffs to protect themselves.

When I was laid off several years ago, my company put together a spreadsheet presumably "justifying" who in fact was laid off versus who was retained through a variety of criteria. This spreadsheet was distributed to all employees to be terminated.

Information compiled therein included salary information, age, years employed with the company, evaluation rating, etc. I can only conclude that the company made this available in an effort to prove that those chosen for the chopping block did not fit any pattern that might expose the company to charges of discrimination or other potentially expensive legal actions. Yes, we live in a litigious society as corporate lawyers well know. In a company's point of view, it may be well worthwhile to diffuse any class-action lawsuits before they develop relating to a layoff!

Although companies will avoid layoffs that appear outright discriminatory, employees do well to consider potential red flags making them a more desirable candidate for layoff than the employee in the next cubicle over.

How far down do you rank on the layoff list?

Potential Layoff Ranking Criteria

  1. Salary. For every person earning $80,000 per year, two employees' $40,000 salaries can be paid. Those with higher salaries are likely also to be at higher risk for layoff all else being equal.
  2. Age. On the one hand, companies must avoid layoff patterns which give the appearance of being motivated by ageism, potentially subjecting them to lawsuits. On the other hand, it is well-known that older people tend to have more health problems which may result in higher cost to the company.
  3. Performance. An employee's rating in annual reviews is often called into question when people are being ranked on corporate layoff lists. If your boss has not presented you well on these important evaluations, you may be in trouble.
  4. Popularity. How popular are you in they eyes of your peers, your boss, your boss's boss, etc? Do you have a "protector" in your command chain? People being the political animals as they are, having popularity in the company can never hurt!
  5. Location. State laws can often be either advantageous or disadvantageous to companies and companies will often shut down entire offices at locations they do not wish to do business in anymore. Employees in states with laws generally disfavoring business or heavily taxing businesses could be worse off when a company decides to close offices.
  6. Project. It never hurts to be working on a project that is making money or expected to generate revenue in the future. Being on a dead-end "legacy" project or a project slated to be cancelled can be deadly. Try to get on projects viewed as having a future.

Appropriately Reacting to Layoff Threat

Clearly, there is no "simple" criteria for targeting employees for the axe. In addition, employees nowadays also have to consider that not only may there be one big layoff, but a series of layoff hurdles may have to be endured.

After surviving some five different "Force Management Plans" I thought I was safe at least for a few weeks. The next week, the story was different. I was told the company had to make deeper cuts than originally anticipated and so it went further down the ranked list of candidates including my position. Lucky me!

To remain in your position, it may do well to do some self-promotion in advance. Stay on cutting edge projects or on accounts that are vital to the company. Also, it never hurts to flexible, cordial in demeanor and with current skills that can be redeployed in changing conditions. Keep up your contacts within the company, with vendors and associates, etc.

It can be helpful to maintain a profile independent from your company. LinkedIn is a well known professional networking site at which you can find others in your field at all manner of other companies. This will help you target a new position in the event of a layoff or series of layoffs.

Establishing and keeping networks with former work associates and acquaintances from all areas may help you network right into that next position should you get targeted for layoff by your current company.

Finally, if you should be laid off, terms of the layoff may be negotiable according to needs that you should identify. It may help to bring these to the attention to the company before settling on a package. The video following this section features a Layoff Coach who addresses such concerns.

Best of luck! -- Laura in Denver

Tips from a Layoff Coach


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    • Laura in Denver profile image

      Laura Deibel 6 years ago from Aurora

      Thanks. Sadly, the economy continues to tank.

    • profile image

      mini project topics 6 years ago

      Brilliant info and nice tips, keep sharing.

    • John  Lakewood profile image

      John Lakewood 7 years ago from Lakewood, CO

      Good point about having a protector in upper management. Politics, yes.

    • profile image

      Phinias 7 years ago

      I wish we all could negotiate the kind of 'golden parachutes' the top execs get.

      Nice, hub, though.

    • Bella DonnaDonna profile image

      Bella DonnaDonna 7 years ago from New Orleans, LA

      Wonderful tips in this very uncertain job market.