With COVID-19 causing unprecedented disruption to the U.S. and world economies, many financial services firms have had to make the difficult decision to lay off or furlough workers. In the case of furloughs, employers have often communicated that they hope and expect to hire employees back as soon as they’re able. In this situation, maintaining clear and consistent communication is crucial not just to build internal confidence but to manage reputation more broadly.
In a media environment rife with reporters focused on how financial firms are responding to the crisis—and hungry to expose anyone taking unfair advantage of government stimulus programs or profiting while employees are negatively impacted—thoughtful and strategic communication is more critical than ever.
Retaining employees you’ve trained and cultivated is in a firm’s best interest. Research suggests direct replacement costs can reach as high as 50-60 percent of an employee’s annual salary, with total costs associated with turnover ranging from 90-200 percent of annual salary. However, keeping employees aboard can be a challenge today as attitudes have surely shifted, loyalty is fleeting and customers and the revenue they provide have been significantly impacted.
|This article is featured in O'Dwyer's Aug. '20 Financial PR/IR & Professional Services PR Magazine.|
Accelerate pace of communication
A key step is to increase communications frequency with both retained and furloughed employees. All employees hold a direct stake in the success of the firm and are often the front line of communication with customers, business partners and other stakeholders. They can be your greatest advocates through these turbulent times—but only if they feel the company is being transparent and keeping them informed.
This means more frequent communication—even when circumstances haven’t changed—and being prepared to field tough questions about uncomfortable issues. While your communications strategy needs a certain amount of flexibility, it’s unwise to play it by ear. Build a reasonable schedule and stick to it so employees know when they’ll hear from you. This also forces management to prioritize this activity and to really think about the important issues and get aligned on messaging.
Thoughtful messaging is vital, and a good guidepost is to be as transparent as possible regarding what’s happening at any given moment. Transparency should stay within limits, of course, and absolutes should be avoided at all costs. Remember: during a crisis, the stakes are amplified and leadership is in the spotlight. The most valuable asset you have in this environment is your credibility, so you can’t afford to put it at risk.
With furloughed workers, maintain open avenues of two-way communication and offer good news when possible to keep them interested in returning to the workforce and staying engaged with the company. When sharing positive news, be particularly conscious of tone and context. This is a very difficult time for many and you don’t want to appear celebratory when employees are struggling and the path forward remains uncertain.
Finding an authentic voice
If the company had to undergo more than one round of furloughs, and you’re bringing people back in phases, it’s important to be sensitive to how different groups may feel about their value and place in the company. Clearly explain and reiterate why actions need to be taken. Be the encouraging, inspiring and empathetic leader you’d want to hear from in this environment.
The approach isn’t much different for retained employees. Knowing that your furloughed team members are likely in touch with colleagues and friends who’ve remained on the job, it’s critical that the messaging remains consistent.
Businesses usually confront legal restrictions in formal communications with furloughed employees, and their access to channels like Slack or Teams will be similarly restricted. Creating a dedicated and up-to-date virtual space these workers can easily access to stay informed is an important step in this process.
Putting a human face on your communications is vital. Consider, for example, a bi-weekly video recording or fireside podcast. It’s one thing to read about managing through difficult business conditions in a pandemic, and quite another to see and hear leadership explain it with conviction.
Cultivating employee ambassadors
Leadership should also identify and connect with employee ambassadors to determine the optimal way to reach all segments of the workforce, including those on furlough. The goal is to create a reliable process and vehicles for providing continual updates and collecting feedback so you understand and can address key concerns.
Though social media may feel like a natural avenue to employ to maintain these connections, it also comes with pitfalls. By design, social media is open and shareable and thus open to greater scrutiny. It’s important to create a secure space where conversation can happen and messages are less likely to be misconstrued.
For the retained workforce, virtual happy hours over videoconferencing platforms have become popular. Team-wide and company-wide video chats allow you not only to inform but maintain a collaborative, supportive culture by addressing non-work-related matters. For more sensitive topics such as team or compensation changes, one-on-one engagement is the right approach even though it requires more coordination and investment of time.
Are you ready for the ‘new normal?’
While there’s hope we may soon be on the decline curve of this pandemic, now’s the time to plan what “normal” will look like for your workplace and how communications practices need to evolve. You shouldn’t assume that once there’s a green light to return to the workplace that communication can be de-prioritized or become less frequent. Leadership must clearly articulate how you’re thinking about the issue, and reiterate that employee health and peace of mind is your top priority. Employees need to know you’ve done everything you can to make their physical space as safe as possible.
For many businesses, the right move will be to put forth a plan but also to seek employee input so you can respond to concerns and make the necessary adjustments. Employees know the situation changes day-to-day and can react negatively to a policy dictated to them without input. Furloughed employees will have many of the same issues plus an additional layer of concern about go-forward job security, so it will be important to reinforce messaging about the stability of the company, speaking confidently but avoiding guarantees.
The pandemic is unprecedented and there’s no one right approach. However, smart financial firms are rethinking how they engage with employees and how communications can create and maintain strong, lasting bonds. We’re truly all in this together.
Alex Stanton is CEO of Stanton.