choosing an outplacement services provider.

Challenging economic conditions and changes in the business environment force company executives and HR leaders to make tough decisions. While most leaders would rather deal with talent development, talent transition through layoffs and strategic reduction in force (RIF) is sometimes unavoidable.

In fact, strategic downsizing as the changing global economy and geopolitical landscape affect businesses is often a matter of survival. But terminating someone’s contract in your organization is never easy. Layoffs devastate employees since they lose income, an identity, and a community of colleagues. After a layoff, most remaining employees worry about their next step and career prospects.

While downsizing is a difficult experience for all parties, you can make the process less unpleasant by providing outplacement services. 

what is an outplacement service?

An outplacement service provider is hired by an employer reducing their workforce. An outplacement service provider assists laid-off workers in transitioning to new careers quicker and better than if the employee is left to their own devices. This allows the employer to potentially shine at a time when this is a huge risk to corporate reputation and employer brand.

Outplacement service providers deliver their services in different ways, but the higher quality firms leading the segment typically provide expert coaching and career advice to laid-off workers as they transition to new careers. This helps affected employees do everything they need, from revamping their resumes, practicing for interviews, developing their personal value proposition, and building their personal brands for the current job market.

When circumstances push you to lay off workers, your job doesn't end when you give them notice. It is important to have a thoughtful approach to downsizing to maintain your employer's brand and keep the remaining workforce engaged. 

Companies provide a severance package based on the employment duration and payment for unused vacation and sick days. This is a short-term solution since the cash can run out before the employee secures a new job. The dwindling bank account, unanswered job offers, and regret letters cause unnecessary stress and emotional distress.

An outplacement provider gives those impacted the tools and resources to move forward and progress in their careers. It also gives laid-off workers a lifeline and something to focus on during uncertain times.

four reasons why HR managers should provide outplacement services

Layoffs don't impact employees only. Your company also suffers the consequences of downsizing. For instance, many companies face high employee turnover after mass layoffs. According to Harvard Business Review, laying off 1 percent of workers increases voluntary turnovers by 31 percent. 

The negative impact on your reputation also affects your talent acquisition. However, outplacement programs are mutually beneficial services that positively impact everyone. Here are four reasons for companies to offer outplacement programs:

1. your brand reputation hangs in the balance


A good employer reputation is crucial in talent acquisition. Hence, ensuring exiting employees focus on their career transition will reduce the adverse effects on your social reputation. 

When laid-off workers are focused on their frustration and disgruntlement from the downsizing, they express their dissatisfaction on social media. The ripple effect of a poorly handled termination damages your employer's brand. When searching for the best talent, the bad reviews on job listings and boards reduce your talent pool. Only one in five candidates apply for jobs in companies with low ratings.

The right approach to downsizing and offering outplacement support reduces the outplacement fallout. Aside from positive reviews, your company will experience a low turnover since the remaining employees aren't inclined to take other jobs with better security. Customers are also loyal to companies that treat their employees well, and offering outplacement services shows that you take good care of workers.

2. creates security for survivors


Your downsizing practices don't just affect the laid-off workforce; they also affect the survivors. Whether you let go of a few employees or conduct a mass layoff, the process builds anxiety among the remaining employees (survivors). It leaves them wondering if they are next or introduces guilt and anxiety. The negative emotions ultimately causes a 41 percent decline in job satisfaction and organizational commitments. 

Outplacement services help calm their fears and improve employee engagement. Knowing their friend received help finding new jobs diminishes the tension and builds loyalty.

Handling your off-boarding process well in sensitive situations makes your employees willing ambassadors and are likely to endorse your company with great reviews.

3. minimizes wrongful termination lawsuits


Layoffs often lead to wrongful termination lawsuits and unemployment claims. Losing a job is traumatic. In fact, some laid-off workers go through the five stages of loss. One of the stages is anger, and since they want to take out their frustration on someone, some laid-off employees file wrongful termination lawsuits. They may cite discrimination, hostile work environments, and harassment to receive compensation.

When you provide outplacement services, the employees' support gives them options and strategies to move through a difficult phase. They won't have to resort to lawsuits to get back at your company. Aside from relieving employees' stress, it eases the anxiety of HR managers when they let people go.

4. outplacement service costs may save you money


Most employees prefer a severance package after a layoff. While severance packages take care of financial woes, it's a temporary solution. Besides, offering a fair severance package is costly in mass layoffs.

Hiring an outplacement company can be beneficial and cost-effective since it offers long-term value for employees. Budgeting for outplacement before a mass layoff also prevents litigation by unhappy employees since they are more likely to secure new jobs before leaving the company. Sometimes, outplacement services lower the unemployment claims if laid-off workers return to work faster.

benefits of outplacement services

Some of the advantages of offering outplacement services include:

  • empowering laid-off employees: whether you warn your employees early of a looming layoff, the finality of the last day and uncertainty associated with unemployment is devastating. An outplacement service provider helps them move to the next stage of their careers. It gives laid-off workers something tangible to focus on, providing the tools to rediscover their passion and prepare for the next step.
  • provides coaching: when laying off long-term employees, it is important to provide career coaching. Since they have been out of the job market for a while, they aren't updated on the latest job search trends and have no idea how to structure their time in career transition. Outplacement services provide career coaching necessary for securing new jobs.
  • helps speed up job search processes: finding an outplacement service helps laid-off workers find the next job. The job market is hectic for laid-off employees with difficult transitions. Providing support in job hunting relieves some of the pressures of losing a job. An outplacement provider speeds up finding new work by assisting with resumes, scouring job listings for suitable vacancies, and interview preparations. Your workers will also receive support for difficult transitions like changing industries or careers.
  • no cost to employees: when workers lose their source of income, the main concern is the expenditure, and many will not afford to hire a career coach. Fortunately, outplacement is complimentary for employees, and they don't have to chip into their dwindling bank accounts for the services.

how to choose an outplacement service provider

How can you find the best provider? If you decide to provide outplacement programs, it is important to choose the right provider since inadequate outplacement services negatively affect your organization.

How do you ensure the outplacement company provides the transition support that employees need? Here are key areas to help you find outplacement support for your employees:

  • expertise: when shortlisting outplacement service providers, it is important to find out their experience in the field. Are they expert outplacement service providers or still new in the sector? Your needs determine if the company provides the best outplacement support. For instance, if you require support for middle and senior managers, the service providers should have expertise in executive outplacement services. If industry knowledge is important in providing career transition support, you should consider the industry sector that serves your employees.
  • coaching services: an outplacement provider with one-to-one interactions with employees offer better support than online services. The quality of outplacement support usually relies on the expertise and experience of the coach. It is important to find out the coaches' professional backgrounds. The outplacement provider should offer coaching services suitable for the current job market.
  • customized services: employees usually have different career aspirations after being laid-off, and the outplacement provider should offer tailored services. Some employees may be interested in transitioning to other industries or moving upwards in their careers. Regardless of an employee's plans or aspirations, the chosen outplacement provider should have an adaptable solution to meet the individual's needs and ambitions. An outplacement company offering generalized services may be suitable for workers looking for a similar role but may not cater to employees looking for a portfolio career.
  • program clarity: it is important to ascertain the services offered by an outplacement company. Some are strong on content with rich internet sites and workbooks and provide minimal one-on-one coaching. Choose an outplacement program with a healthy combination of coaching and digital services to build an employee's confidence. Some of the services that should be available in the program include resume writing, personal branding, job matching, and interview preparation. Some also include networking and upskilling sessions to improve the marketability of an employee.
  • outplacement cost: as you compare pricing for different service providers, ensure you are comparing 'apples with apples.' Ask for the costs of similar outplacement services. For instance, a company could charge a low fee, but you also pay for extra services that other companies offer at similar rates. Ensure the conditions are favorable and you only pay for the services you need.

why randstad risesmart is the leading outplacement provider

Randstad RiseSmart helps you take care of outgoing employees by providing comprehensive outplacement services that ensure sustained engagement. Considered a leader in the field, we partner with HR teams to guide transitioning talent via a suite of services that are designed to support both employee and employer.


For everything you need to know about outplacement services, check out this article.

28 September 2022

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