Firing Vs Layoffs

No HR professional loves to terminate or fire any employees. It is never an easy decision to let go any employee. But unfortunately, it is unavoidable under certain circumstances. If your employment is ended, you are either fired up or you are laid off. It is important to understand the difference between these two terms in order to explain someone why you are job hunting.

What is a layoff?

Being laid off and fired up are entirely different terminologies. A layoff means down-sizing or reduction in workforce. It usually happens in bulk. It is actually not considered to be the fault of employee but employer. A layoff may include-

  • Sometimes layoff focusses on the employees in a specific location or job titles
  • When a company acquires one more company, many of the employees in the acquired company are laid off because acquiring company already has employees doing the same jobs
  • Sometimes lay offs are done due to financial crunch
  • Sometimes everyone is laid off as the employer shuts down the operation or company permanently.

Why layoffs take place?

A change in the employer’s financial strength or a new direction for the corporate strategy can be the reasons behind the layoffs. There is nothing to do with employee, it is right-sizing by management. The biggest item in an employer’s budget is often the salaries and benefits of the employees. That’s is why whenever cut offs are made in expenses, they target to this particular budget item.

How selection of employees is made for layoffs?

Performance is never an issue while selecting employees for layoff. If it is not a big news across the local area, explanation is always required in a job interview or networking discussion. Though laying off the least productive employees may sound logical but it does not often contribute in the reduction of budget. So most-highly paid employees are generally on the layoff candidate list.

Don’t be hesitant to ask for severance package

Laid off employees are entitled to severance packages. It depends on employers, locations and situations. It may include continuation of standard pay for weeks or months, assistance in finding new job or other benefits that may important to the employees.

What is firing?

Being fired does not always related to performance of an employee. New manager wanted different staff, bad chemistry with management or there can be thousand reasons. It is must for the manager to pinpoint main reason for letting someone go and he has to ensure that the reason is not discriminatory in any way. The manager also has to plan a termination meeting wherein a short explanation is provided for the decision.

Managers should be well prepared for the possible questions employees may have. If an employee has been fired, there is no point to panic. the employee should also be prepared to explain it very carefully to the future employers.  If you think you have been fired illegally because of your race, age or any similar reasons, look for a lawyer who has expertise in employment law.



Reshali Balasubramaniam

Head of HR, HR Counselor and adviser at and EFutureTech Systems. Submit your resume online and be contacted by prospective employers.


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