Headlines about organisations that are letting go of employees have placed greater scrutiny on how employers manage their layoffs, with risks awaiting those who handle them poorly.

This is according to a new report from Careerminds, which revealed the internal and external "aftershocks" experienced by organisations that carry out layoffs in workplaces.

Internal 'aftershocks'

Internally, 39% of employees say layoffs negatively affected their perception of their employer. Another 21% added that they are unlikely to stay with their employer after layoffs occur.

HR leaders also feel the internal impact of layoffs, with 40% of them saying layoffs increased voluntary turnover.

A study from the Academy of Management cited in the report also noted that layoffs cause higher-performing employees to resign at disproportionately higher rates.

"As high-performing employees often make an outsized contribution to performance, even small increases in voluntary turnover within this group have a significant impact on capabilities, culture, and institutional knowledge," the report read.

"This loss of critical talent reduces productivity, as teams lose expertise, momentum, and leadership."

Reputational 'aftershocks'

The risk stemming from poorly managed layoffs extends to the employer brand, as the report pointed out employees' growing tendency to share their experiences online.

In fact, it found that 69% of employees have already shared or would consider sharing negative experiences of layoffs on platforms such as Reddit, LinkedIn, or Glassdoor.

"These negative experiences tend to get more attention, and persist well beyond the layoff event, shaping how future candidates, remaining employees, investors, and customers view the organisation," the report warned.

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