How do Redundancies Affect Company Culture?


A redundancy is always tough. Despite the best intentions, the company you’ve once led into financial safety just won’t be the same anymore. One study even shows that restructuring can have a significant impact on employee well-being.

Learn how redundancies can affect the “survivors” of the company below.

For the operational teams

Those who get spared from redundancy can go through a dip in morale and productivity. Also called “survivor’s guilt,” employees who remain will manifest their guilt through depression, anxious thoughts, and poor self-esteem.

According to a study made by Leadership IQ, “74% of employees who kept their job amidst a corporate layoff say their productivity has declined since the layoff.” Around 87% responded that they would be less likely to recommend the company as a great organization to work for following a redundancy.

For the managers & the HR department

Also called the “envoys,” managers and members of the HR department carry the most extensive baggage among all employees. Leadership roles are often the ones who open difficult conversations, often with little to no support.

After a period of downsizing, envoys will be hit hardest with the psychological impacts. Feelings of anger, guilt, sadness, and frustration can make them less productive and weaken ties with the company.

What can you do?

Even when all is said and done, there are still things that organizations can do to curb survivor’s guilt among their employees. Communication is critical, so train leaders in your team to be approachable and candid.

Building trust and credibility within your team is crucial to keep their motivations and morale at a stable footing. Managers who can conduct layoffs with compassion and leaders who can consistently manage the workforce following a downsizing will yield the real cost savings.

Are you planning a redundancy in the Philippines? Do the right preparations with Lee Hecht Harrison, a global talent consulting agency with over 400 offices in more than 70 countries. Our league of career coaches and consultants, backed up by the company’s 50+ years of experience in the industry, puts your layoff plan in good hands.

To set an appointment, shoot us a message by clicking here or call 0908-814-2423.

How do Redundancies Affect Company Culture?
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