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By DAN REYNOLDS, senior editor of Risk and InsuranceŽ

CHICAGO---The image has become so engrained in our collective consciousness that we know exactly what it is when we see it. One of our fellow employees, sometimes accompanied by a manager or even security personnel, being escorted to the exits with their office supplies and other belongings in a cardboard box.

The problem with that picture, according to a leading disability management consultant, is that that manner of letting an employee go is all wrong.

"Guess what, it's an overreaction," said Richard Pimentel, a senior partner with Granada Hills Calif.-based Milt Wright and Associates, during an afternoon session on managing employee stress at the Annual National Workers' Compensation and Disability ConferenceŽ & Expo in Chicago.

Contrary to what the "best and the brightest" might think, that sort of approach to managing labor is fear-based and creates more problems that it is supposedly designed to prevent. Most employees who are getting laid off aren't going to sabotage the computer system, kick over the water cooler or punch out their long-loathed supervisor.

And what does the cardboard box approach create? It creates a "chicken coop" mentality. Think of the aftermath in a chicken coop after the farmer has come in and wrung a few necks for the stew pot. You might think that the chicken that got its neck wrung got the worst of it. But in many cases, those hens that are still in the coop are under more stress.

That stress in some states might end up as a stress claim or, in others, might eventually translate into a physical trauma and a workers' comp injury claim.

"It's not all in your head, it's physiological," Pimentel said.

When layoffs occur, there is often a "fight or flight" reaction among the remaining employees. Absenteeism increases, productivity drops, and the employees who watched their colleague escorted out often have a much poorer impression of, and far less loyalty to, the company they work for.

"If this is the way they treat us, how much loyalty do I owe them?" was how Pimentel put it.

How much loyalty indeed?

A far better approach, Pimentel advised, and heaven forbid that it happen in the emotionally buttoned-down corporate world, is that managers and other decision-makers actually talk to their employees about what's happening.

We're adults. We can read newspapers and turn on the Internet or the television set. Talk to us about the economic conditions that are leading to belt tightening. Who knows, maybe we even have ideas about what to do about it, short of layoffs.

Milt Wright, the founder of the company that Pimentel is a partner in, told the story of his client, the city of Beverly Hills, Calif., which took the approach that a little less work for all was better than laying off some.

Other organizations and companies have taken that approach. And to hear Pimentel and Wright tell it, the employees that were left felt much better about themselves and their employer.

In the Beverly Hills case, the staff came up with 200 cost-saving measures, and everyone's job was spared. That sounds like the team work that so many companies give so much lip service to and so many fail to engender.

So what are best practices even if a layoff happens?

--Encourage retained employees to see keeping their jobs as a sacrifice similar to those who have lost theirs.

--Solicit input from employees on work distribution strategies with a reduced workforce.

--Monitor the pace of work and possible fatigue issues and bring the safety department into the work process planning.

--Offer employees EAP and support counseling

--Allow employees to have input on task priorities when there is more work to do and less staff to do it.

Above all, remember this: Those employees you sent packing are going to have their own issues, but you've got an office or a factory full of people who just watched them go and might be having issues of their own.

(Click here to read all of our other coverage from the Annual National Workers' Compensation and Disability ConferenceŽ & Expo.)

November 23, 2009

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