

How do I lay people off? - wheels
http://venturehacks.com/articles/layoffs

======
tptacek
Start by not asking for sympathy, or writing blog posts encouraging people to
fawn over you for your perseverance and wisdom during hard times.

Next, stop taking a salary, or recognize that you're accepting six figures
while throwing people you recruited out into the worst economy in 50 years.

Finally, move your ass to find those people jobs. Carve out time to write
real, personal recommendations for each of them. Introduce them to every
company you have a relationship with. Sell.

God help you if you write, "it saddens me that we have to let these people go,
because _most_ of them were solid performers". If you kept dead wood in your
company, likely to the detriment of the whole team, and couldn't muster up the
courage to deal with them until the economy gave you an excuse, it's all on
you, asshole.

Yeah, I sound like even more of a dick here than I normally do, but I don't
think I'm the only one noticing the valley patting itself on the back for
fucking people over.

[ _edit_ I'm not super happy with this comment, but I'm not deleting it
either; might as well be honest about what I think. We have employees too.
Maybe I'll be a total douche if something bad happens to us? Tell me you told
me so.]

~~~
lacker
Stop taking a salary? In this economy? Are you crazy?

I totally agree you shouldn't be a jerk and blog about it like, oh it was so
tough for me, I had to fire so many people, the emotional agony it will
inflict on me for the next couple weeks will be so hard. You have to recognize
that no matter how hard it is for you, it's worse for them, something this
blogger didn't seem to want to take on.

~~~
tptacek
Firing an entry-level developer? In this economy? Are you crazy?

Startup founders seem to love calling themselves "CEOs". Working for a one-
dollar salary during rough times is something that real CEOs actually
sometimes do.

~~~
brianr
I don't think that's a fair comparison. Those "real CEOs" generally have a
high net worth to begin with, something that's not true of (I would guess)
most startup founders.

~~~
tptacek
Hey: they asked to be the CEO. They're the ones who walk away with a 7 figure
payoff when the company sells for $5MM. They get 100x the payoff of a
developer because they accepted the risk.

Is it hard to live on $1 a year? Well, it's not harder than living on $0 a
year. But OK: how many of the Valley Layoff Heroes even took a pay cut down to
sustenance wage? Note: normally when people do that, they tell everyone ---
it's a morale boost.

~~~
brianr
How hard it is to live on $1/year clearly depends on how much money you have
in the bank, or other resources you might have. In absence of that (or if your
net worth is actually negative--say, you have a lot of student loans), then
it's just not possible to work without a salary.

You could do some consulting on the side, I suppose, but that would defeat the
point of having employees. And as an employee, you're probably better off
finding a job somewhere else than working at a company where the CEO has to
spend part of his time working on something else just to get by.

------
iigs
It's great advice but may as well have been written in hieroglyphics,
personally I've never seen it taken (three rounds across two companies +
missed payroll during bankruptcy once).

I posit that the reason for this, in tech anyway, is that employees are
generally in one of two categories: 1) Sales people with customer connections
or 2) Developer/admin types who may have a lot of access to systems. In either
of these cases the employer could be concerned that the possibly-terminated
employee is going to damage the assets (contacts or code) that the company
has.

If I could contribute a pattern from my limited experience it would be this:
Companies tend to hire a hatchet-man a few months before layoffs start. It
often looks like an incompetent manager "decided to spend more time with his
family", or the creation of a new, often highly paid, middle manager position.
After the new guy is in his place he lays off the people that he's {decided,
been instructed} to, and then moves on, often because he's burnt out from
doing all of the dirt work that the managers above him are too weak to do.

In both companies the person who was hired as a hatchet man would have been a
far better manager than the one who sailed the ship into the iceberg in the
first place. If as an employer you don't see your manager as capable of doing
this hard job (layoffs), how do you expect them to do the hard day to day job
of managing performance? Just keeping the house clean can save that first
round of layoffs that often consists of the low performers, and without the
horrible morale crush of pink slips.

------
gaius
As someone who has been laid off from tech companies twice, I care about one
and only one thing: the size of the severance package. I don't need
compassion, I don't need understanding, I don't need the people who ran the
company into the ground to "help" me find a new job. Just show me the money.

Heh, both times in fact those who got the chop counted themselves - and were
viewed by former cow-orkers - as the lucky ones.

~~~
iigs
As someone who's watched this happen a couple times I definitely agree.
Furthermore, the earlier the cycle you're in the better your packages tend to
be. The first round got great severance. The second round got a small package
IIRC, and they missed payroll on round three, which is like getting -2 weeks
of salary, pretty sleazy, IMO.

~~~
gaius
Both times for me were when the company decided to stop doing what I did. The
first time, the company got out of technology altogether to concentrate on its
strategy consulting business, all the engineers except a skeleton crew for
maintenance were laid off in one go. Sucked to be one of the engineers they
kept!

The second time was the company shifting from products to services. They said
you can have X months money and leave now, or X/2 months paid to find a job
somewhere else in the company (and then nothing). I didn't look back. In both
cases, senior managers know they're in trouble but think they can get
themselves out, there's still plenty of cash in the kitty and they need to
preserve the appearance of confidence, so they'll pay fair severances. When it
gets desperate - then it's everyone for themselves.

------
cmos
When people talk about how starting a company will bring you to the best and
worst times of your life, this would be in the 'worst' category. Spend time
working your contacts to help them find another job. Your the one that screwed
up, not them.

Don't be afraid to say that.

------
ojbyrne
Totally unrelated, and I'm not really criticizing the article (it's pretty
good) but I was reminded of a recent doonesbury, which also had 4 points:
smoke, fire, hose, shovel.

[http://www.doonesbury.com/strip/dailydose/index.html?uc_full...](http://www.doonesbury.com/strip/dailydose/index.html?uc_full_date=20080916)

------
fallentimes
Honesty + generous severance please.

------
njharman
Do it survivor style and have your employees vote a new guy/gal off each week?

Then...

blog about it, become an internet fad, get lots of free press / attention,
attract customers, expand business, hire more devs.

------
known
If N employees voluntarily cut off their salaries by 50% they can prevent N/2
lay offs.

~~~
bigbang
in most cases N=0

------
nihilocrat
Anything is better than a "parking lot meeting".

------
Allocator2008
It is better to lay people off on a Friday. Studies show there is less chance
of an incident if you do it before a weekend.

~~~
Allocator2008
Hey by the way, that was a quote from "Office Space". It was meant tongue-in-
cheek. Personally, I think lay-offs suck, and if you have a good business plan
(focus on being cash-flow positive) than you lessen your chances of needing
lay-offs. I have seen the "hire too many people in good times", "lay them all
off in bad times" approach with no regard to wanting to be cash-flow positive.
That is certainly not how I would want to do business!

------
Fuca
Tell them Monday that Friday its their last day.

~~~
lacker
I hope you're kidding! Keeping a bunch of pissed off soon-to-be-ex-employees
around the workplace isn't good for anyone. The best you can do is to lay
people off on Friday morning so at least they can be with your friends and
family over the weekend for support.

~~~
jm4
I think early in the week is the best way - at least when firing people. If
you let someone go on Monday or Tuesday they can immediately start looking for
a new job the next morning. With any luck maybe they can start getting
callbacks or a phone interview before the end of the week. That goes a long
way toward boosting morale. The weekend makes it a little more difficult.
Sure, they can update their resumes, apply online, etc., but that kind of
ruins the weekend and leaves a lot of time to start feeling hopeless or really
pissed off.

Plus, some people might not mind so much if you tell them first thing Monday
morning that they have to go home. :)

