Redundancy Survivors

by Rus Slater

The effects of downsizing on staff

When organisations downsize, all your staff will be affected, though in different ways.

Managers

First to be affected, surprisingly and usually with little sympathy, are the managers who have the thankless task of breaking the news to their immediate subordinates. These people have to break bad news to people they work with and may have become friends with. They may have only recruited these people quite recently or they may have known them for years. They are, however the harbingers of doom and, as such, are normally labelled, at least to some extent, as the villains of the piece.

The redundant staff

Secondly, there are the victims of the redundancies – the people who are going to be shown the door. These folk are losing their jobs, their income and, possibly, a chunk of their self esteem. However, they may also be in receipt of a number of ‘advantages’:

  • They may get a redundancy settlement in cash
  • They may get pay in lieu of notice
  • They may get some form of outplacement service
  • They may get an enhanced pension and the opportunity to take early retirement
  • They may get options to buy such things as their company car or laptop at a greatly reduced rate
  • They may be allowed to keep on all or parts of their benefits package for a period after departure
  • They may even get given a contract to come back and do the same job for a daily rate!

Notwithstanding this list, given the modern fixation with people’s jobs, these folk are usually viewed simply as victims and thus are granted ‘victimhood status’.

Survivors and survivor syndrome

Finally, there are the survivors: the people who get to keep their jobs and their incomes.

You felt like you were lucky to be one of the people who remained, but so sad for the people who left and it was extremely stressful wondering what was going to happen next.

Estate agent survivor

Hard as it may be to comprehend, many employees ‘fortunate’ enough to be spared the executioner’s axe are now suffering stress. It turns out that business psychologists have a name for this negative reaction: survivor syndrome.

Though survivor syndrome has been recognised in war and trauma circumstances since the end of the First World War, this problem first came to general attention in a business sense during the recession of the early 1980s.

Workplace survivor syndrome happens this way: the still-employed, who by all rights should be grateful for having jobs, end up losing their identification with, and even resenting, their bosses, because they are the ones who

  • Have to shoulder the extra workload of those who have left
  • Will possibly have difficulty trusting their manager
  • May feel that, since the psychological contract between employees and management has already been broken, they are now living on ‘borrowed time’
  • Feel guilty about having survived when their colleagues got made redundant, which generally damages self esteem
  • Feel anger at the management that placed these feelings of guilt upon them
  • Will doubtless still see their colleagues socially and either hear how badly things are going in the ranks of the unemployed (which will reinforce their feelings of guilt and of misery at their extra workload) or how ‘brilliant it is in my new job; getting made redundant is the best thing that ever happened to me!’ (This will probably lower their self esteem even more and make them resentful of their ex-colleagues and the management that gave them the opportunity).

If I hear ‘At least you have a job’ one more time, I’m going to physically injure someone.

Software engineer survivor

The effect on individual survivors is quite clear from the two quotations above, but does the effect translate to an organisational level? The Chartered Institute of Personnel and Development (CIPD) in the UK is quite unequivocal: it certainly does!

The real cost for each employee laid off can reach £16,375, even before hidden costs like higher labour turnover and a fall in staff productivity are added in.

John Philpott, Chief Economist

Other studies have actually put some hard figures on these ‘hidden’ costs (see When downsizing backfires).

Survivor syndrome, with its negative influence on organisational effectiveness, is a fact, not a theory.

In fact, the survivors are also victims.

Professor Harold G Kaufman,
New York University

The remainder of this topic is dedicated to the management of this last group, remembering that managers are survivors too! They had the trauma of delivering the bad news to the victims and now they have to work hard, shouldering extra work and massaging the tattered egos of the ‘lucky’ few who they chose keep on.