The ELA is proud to welcome our newest member firm: LOGOS  in Iceland!
The ELA is proud to welcome our newest member firm: LOGOS  in Iceland!


Extraordinary Workplace Misconduct: Bah Humbug!

Submitted by Firm:
Shawe Rosenthal LLP
Firm Contacts:
Gary L. Simpler, Parker E. Thoeni
Article Type:
Legal Update

In this season of joy and giving, we ran across our next instance in our occasional series of craziness in the workplace. This one involves the embodiment of Scrooge (before he found the Christmas spirit, of course).


As reported by NBC news, the CEO of mortgage company just laid off 900 employees. In a surprise group zoom call. That lasted 3 minutes.  Smack dab in the middle of the holiday season (on the last day of Hanukkah, just weeks before Christmas and Kwanzaa). Ouch!

In a recording of the CEO’s call, he stated that, “We are laying off about 15 percent of the company for a number of reasons — the market efficiency and performances, and productivity…. If you’re on this call, you are part of the unlucky group that is being laid off. Your employment here is terminated effective immediately.” (???!!!) And the employees’ computer access was turned off almost immediately thereafter.

During the call, the CEO also made the following astoundingly tone-deaf statement – “This is the second time in my career I’m doing this, and I do not want to do this. The last time I did it I cried. Um, this time, I hope to be stronger.” (Yes, because this is all about you, dude. Not the hundreds of employees that you just blindsided and devastated).

Now, we’re quite sure that the company had reasons for the timing of the terminations. And it didn’t just turn the employees entirely loose – it is providing about a month’s pay and three months of benefits. But there are certainly some lessons here for other employers facing reductions in force:

  • It’s best to handle terminations individually. Even in a situation involving hundreds of employees. Although it’s a lot more work and time, terminations are traumatic for the employee, and it’s definitely more respectful and thoughtful to deliver the news on an individual basis. It doesn’t mean that the same management official needs to do all the meetings – that can be divided up, perhaps among department heads or regional managers.
  • Give the employee time to ask questions. There may be questions that the management official cannot or should not answer about why the employee was selected for termination, but employees often have questions about pay and benefits. The management official can have a script or written summary that can be provided to the employee, and can refer the employee to benefits representatives. But at least do the employee the courtesy of knowing that they will get answers to these very typical concerns.
  • Although it’s fine to express regret about having to take the action, don’t talk about how bad it makes you feel. We guarantee the employee feels worse.
  • If possible, it’s best to avoid taking these actions around the winter holidays. There’s a lot of emotion wrapped around them – more so than other holidays. We understand that there are times when the timing can’t be avoided, but do you really want a jury to hear: “He was laid off just before Christmas”?