How to Announce a Company Closing to Your Staff
Once you've made the painful decision to close your business, it's time to let everyone know, especially your employees. Announcing the news of a business closure to your staff, however, doesn't have to be as painful as you might imagine. But before you announce a company closing to your employees, you must carefully consider the timing, the language you will use, and your reaction to their responses.
7 tips on how to announce a company closing to your employees
1. Let employees know the business is closing before they read about it
Surprises are OK if it's your birthday, but finding out through the grapevine that you no longer have a job isn't ideal, and reading about it in the morning paper stinks. Don't disclose information to the media before you've informed the people who have contributed to your venture and demonstrated a certain amount of loyalty along the way. Even if your relationships with employees have somewhat soured due to lower sales or unforeseen business circumstances, it's simply unprofessional to discount your staff's feelings at this sensitive and admittedly volatile period. And don't ever believe a reporter who assures you that what you say is "off the record." Nothing is off the record.
2. Clear out the rumor mill
It's stunning how quickly rumors begin when a major change is afoot. Instead of attempting to trace the origin of a rumor, put it to rest by telling the truth. Tracking a rumor is a time-consuming and generally futile exercise; as you're busy trying to find the culprit who started the rumor, it's changing and taking on different forms. It's best to tell people, for instance, that unless they hear it from you (or a trusted colleague, such as someone on your management team), assume the information is not true.
3. Treat staff with compassion and respect
If you're dealing with the stress of business closure, giving your staff the bad news might seem like the least of your worries. But as the business owner, you owe them a certain degree of compassion and respect as you prepare to announce the closing of your business. Hopefully, your staff has been loyal and committed, and therefore deserve the courtesy of your loyalty and commitment. That means presenting the facts and resisting the temptation to soften your language at the risk of leaving important questions unanswered. For instance, be prepared to answer questions about health insurance, unused vacation, expense reimbursements, and other issues that are likely to arise.
Other Articles From AllBusiness.com:
- 5 Essential Planning Tips to Help Your Business Survive the Pandemic
- 6 Things Entrepreneurs Should Do Before Announcing a New Launch
- Selling Your Business? 10 Tips to Keep in Mind Before Announcing the News to Employees
- Leadership Lessons from My Brother, Paul
- What Happens to Employee Benefits During a Furlough?
4. Determine the fate of unfinished projects
Even if you're closing your company down, you could be under contract to complete some or many projects. Make sure you discuss these with the appropriate employees so that they have enough time to complete the work. You'll need to decide, too, if the project will be completed or terminated. Try to do that before announcing the closing.
5. Choose your communication channels carefully
Announcing a company closing to your staff should not take the same form as publicizing the annual picnic. Company events like holiday parties and retreats are easily made known through email—it's quick, efficient, and allows people to keep working. But informing your staff that the company is closing should not occur through an email. You could be branded a coward and any attempts to forestall the makings of a rumor mill will certainly fail.
6. Be sure to cover your legal bases
Depending on the size of your business, there might be legal requirements you must fulfill in closing your business. Consult your professional advisors—lawyer, accountant, etc.—early in your decision-making process.
7. If you can help your staff, let them know
As soon as your staff is aware of the company closing, they're likely to focus on their futures. What's next for me? Will I be able to find a new job? How long will it take me to find something? These are just a few of the many questions that will probably go through their minds. Some employees might wonder if you can help. For instance, will you provide references? Can you call people on their behalf and make some introductions? Including this kind of supportive information in your announcement could help make the news a little less shocking.
FAQs about announcing a business closing
Below we have summarized the most important questions and answers on the subject
How do you communicate when your business is closing?
1. Let employees know the business is closing before they read about it
2. Clear out the rumor mill
3. Treat staff with compassion and respect
4. Determine the fate of unfinished projects
5. Choose your communication channels carefully
6. Be sure to cover your legal bases
7. If you can help your staff, let them know
When should you tell your employees you are closing?
As soon as possible. Don't disclose information to the media before you've informed the people who have contributed to your venture. And don't ever believe a reporter who assures you that what you say is "off the record." Nothing is off the record.
