business value-benefits-outplacement

When organizations take stock of the benefits available to employees, outplacement benefits are often overlooked as part of the overall package. You might be wondering why a company would include outplacement assistance as part of its overall employee benefits package when the last thing many employers want to think about is potential layoffs.

What are the business values of outplacement for the employer? They include:

  • decreased costs associated with layoffs
  • positive experiences for impacted employees
  • improved productivity and morale among remaining employees
  • protection for your employer and corporate brand
  • appeal to qualified talent and new business

What is included in outplacement services? Outplacement benefits can include:

Having outplacement benefits already in place – rather than waiting until you have an immediate need to start researching potential outplacement firms – can help your organization be prepared. It also shows current employees you’ll help them make a successful career transition if they’re impacted by a layoff. Below, we’ve outlined key benefits of outplacement and why it’s valuable to both your business and your employees.

related content: why your organization needs to be prepared for a layoff.

How do employers benefit from outplacement?

decrease costs associated with layoffs

It might seem counterintuitive for an organization looking to decrease costs through a reduction in force to invest in outplacement services, but in many ways, the business value can far outweigh the cost. For example, supporting employees through outplacement services can help speed up the job search, reducing costs associated with severance and unemployment taxes, among other expenses.

The cost of outplacement services varies depending on the needs of the company and the professional level of the impacted employees. Some variables that determine the cost include, the number of impacted employees and level of services offered to employees – such as amount of coaching time, resume critique versus resume writing and length of time services are available. Other factors might include any additional services and programs – such as career development and related programs for remaining employees – and discounts offered by outplacement firms, often based on volume.

The potential business impact and costs associated with not offering outplacement services underscore the business value of supporting departing employees. Given the cost of outplacement services, it’s important to evaluate potential outplacement firms carefully, consider your organization's unique needs and choose your partner accordingly.

support a positive experience for impacted employees

The absence of outplacement services and other means of supporting exiting employees can lead to unexpected costs for your organization. If impacted employees have a negative experience, they might share this experience on social media or employee review sites like Glassdoor, which will position your organization in a bad light and make it more difficult – and costly – to recruit qualified employees down the road.

According to a study from Randstad and Future Workplace, 57% of employees surveyed said they won’t even apply to a company with negative reviews. Disgruntled former employees might also consider filing wrongful termination lawsuits, which can put a financial strain on your organization.

drive productivity and morale among remaining employees

Layoffs and reductions in force also impact remaining employees and can lead to a decline in employee productivity and engagement. In fact, a study from Stockholm University and University of Canterbury found that layoff ‘survivors’ face a 41% decline in job satisfaction, 36% decline in organizational commitment and a 20% decline in job performance.

By maintaining transparency in all communications, making it clear to remaining employees that their colleagues were let go through no fault of their own and highlighting how your organization is assisting exiting employees through outplacement services, you can maintain morale and productivity at a time when many employees are feeling added stress. 

related content: 5 ways to keep employees productive before, during and after a layoff.

protect your employer and corporate brand

How organizations treat employees during downsizing says a lot about a company and its values – and employees increasingly expect this kind of transparency.

While many employers might think outplacement doesn’t necessarily need to be discussed during a benefits overview with candidates and new hires, outplacement services are a key piece of any benefits package. Outplacement benefits can help your company stand out during recruiting, showing a commitment to your people, and even reduce the cost and duration of recruiting efforts.

Outplacement services, along with standard severance packages, advance notification policies and other reduction in force unemployment benefits should be discussed with employees as openly as common benefits such as medical, dental and retirement plans.

Beyond maintaining transparency with employees, top employers today understand the importance of showcasing a commitment to their corporate values and brand to the broader public. Given a spike in unemployment due to the COVID-19 pandemic, much of the stigma surrounding layoffs has decreased – but how employers treat impacted employers has a significant impact on an organization’s brand.

Airbnb recently had to make the difficult decision to reduce its workforce by 25% and Co-Founder and CEO Brian Chesky wrote an open letter to his employees announcing this news, which was also posted on the Airbnb website. His letter positions Airbnb as an ideal example of a transparent, compassionate employer that is living up to its brand values. In addition to offering employees severance and healthcare benefits, the letter highlighted several ways that Airbnb is offering departing employees job support, including outplacement services. Other organizations, such as Intuit and Mozilla, have shared similar letters.

related content: how leaders can communicate with transparency during a crisis.

attract qualified talent and new business

Assisting employees during a layoff reflects well on a company’s employer brand and overall brand. Organizations that build a reputation for treating their employees right during challenging times will be employers of choice when business and hiring pick back up, making it easier to acquire qualified talent. A positive brand reputation can also help organizations attract new business from customers who want to partner with a company that upholds its values.

At Randstad RiseSmart, we partner with organizations from around the world and across industries to offer successful outplacement, career transition and talent mobility solutions. We’re dedicated to helping best-in-class organizations embrace their corporate values and assist their employees as they make successful career transitions – both inside and outside the company.

‘What I love about RiseSmart is [the] ability to link all the parts together. [...] We wanted to work with someone who could really see what it was we were trying to do. We wanted someone who could fly with our vision and have an aligned commitment around employees.

I never felt like we were just given a product. It was always the discussion. It was always an understanding of where we were, what we were trying to achieve, how we could achieve that and what RiseSmart could bring to the table. Honestly, we know the impact that this has had, and it has been positive. It’s much better than if we had have just given people a pass out the door to do outplacement counseling.'

head of HR at a major airline following a call center closure

bring the value of outplacement benefits to your organization

From both a business and brand value perspective, outplacement services are a worthwhile investment for any organization. By offering impactful outplacement services, you can drive cost savings, support a positive experience for departing employees, increase productivity among remaining employees, protect your brand, and set your organization up for long-term success by being better positioned to attract both qualified talent and new business.

To learn more about Randstad RiseSmart and how we can bring value to your organization and employees through effective outplacement and talent mobility services, schedule a demo today.


Submitted by:

Beth Kempton

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03 June 2020

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