The success of reorganizations largely depends on how the workforce reacts and how they classify the procedure of redundancies in terms of fairness (Garaudel, Noel & Schmidt 2008). The dismissal procedure is monitored very closely by the employees and thereby the communication of the management plays a key role.

The termination of an employment contract often means a painful loss of a central part of a person’s life. Dealing with grief over the loss of a job has parallels with the theses of death and loss research (Mayerhofer 1989). The renowned death researcher Kuebler-Ross distinguishes five phases of the psychological processing that the dying go through. These five phases can also be transferred to other difficult phases in life, such as losing your own job.

Phases of the psychological processing of dying according to Kuebler-Ross (2001)

1. Shock and unwillingness to believe (denial)
The news is suppressed, the person concerned believes that it is a mistake. Opposing assessments are actively sought, future plans are forged.

2. Anger
Those affected feel that the situation is unfair. They face their environment (the bearer of the message, those not affected) openly with anger and despair and thereby hurt others.

3. Attempt to regain / negotiate (bargaining)
The person affected recognizes that there is no mistake and now tries to change his fate. He is ready to accept unfavorable conditions to reverse the course.

4. Depression
In this phase emptiness and senselessness may occur. This can take two forms. On the one hand, there can be a very strong desire to communicate. Affected people feel the need to express their grief at their loss and talk about missed opportunities, which can bring relief. On the other hand, the depressive phase can be characterized by a personal retreat, which is accompanied by signs of sadness. This phase is usually still characterized by hope for a change in fate.

5. Acceptance
Fate is accepted. Those affected are calm, welcome the decision, cut themselves off from their environment and concentrate on themselves and their next steps.

In the event of restructuring, all groups of people involved are under great psychological stress. The decision-makers are responsible for the success of the measures. There are a number of dangers in the restructuring process such as:

  • Demotivation of the workforce
  • Risk of fluctuation on the part of the service providers
  • Increased absences due to illness
  • Reputation and image loss

From a company perspective, it is important to consider whether the «profit» achieved is greater in the long term than the «damage» that can be done in the short, medium and long term.

Decision factors in downsizing
open communication
quick action
rapid orientation towards the future
make staff cuts fair and in a socially responsible manner
actively take care of the service providers (remaining employees)

The implementers of the staff reduction measures are under enormous psychological pressure. Not only due to the additional workload during the dismantling phase, but above all due to the high emotional stress resulting from the direct confrontation with the dismissed employees. In practice, many organizations are insufficiently prepared for staff reduction measures.

According to phase 1 of the Kuebler-Ross model, the employees refuse to accept the termination. They show different emotions such as passivity, shock, aggressiveness, hysterical reactions or the need to negotiate.

In the event of restructuring, employees who remain in the company after a personnel change are often forgotten as the main focus and resources are placed on the departing employees. However, the feelings of employees who have not left the company are often ambiguous. On the one hand, they are afraid of whether they will be the next «victims», on the other hand they feel guilty about having «survived».

The HR factory is glad to support you in this challenging and decisive phase:

  • Transfer of know-how «how is a separation talk held»
  • Supporting during the downsizing process
  • Care of employees who are in ongoing employment
  • Reflection of the separation process
  • Outplacement advice

Here you can find more information about our outplacement process: