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The Art of Letting Employees Go

By Eli Saslow
Washington Post Staff Writer
Sunday, August 9, 2009

NEW YORK -- The first phone call comes 30 seconds after Kim Hall arrives at her desk. She groans, chases two Tylenol with a gulp from her extra-large coffee and sweeps her bangs away from her eyes. She reaches into a drawer and grabs the notepad that contains what her colleagues refer to as "the tally of destruction." After the third ring, Hall grabs the phone and presses it to her ear. It is 9:03 a.m. on a Wednesday, and another day of economic collapse has begun.

"Five O'Clock Club, this is Kim," she says. "How are you this morning?"

She rocks in her chair as she listens and scribbles notes: A law firm in Manhattan. Downsizing. Their third one this year. Twelve employees. Probably in August. More to come in October and November.

"I'm sorry," Hall tells the caller. "This is so hard. This is really awful."

She hangs up the phone, only for it to ring again. Again. Again. A language translation company in New York needs to fire 30; a not-for-profit in Washington plans to lay off six; a church has to cut three employees with a combined 50 years of service; an insurance company in Kansas needs to let go of two vice presidents; a zoo must dismiss its zookeeper. Hall listens to each caller describe the latest wreckage of this recession. "I'm sorry . . . I'm sorry . . . I'm sorry," she says, over and over, until the morning Tylenol has worn off, the headache returns and she reaches into her desk for another dose.

This is what life is like as vice president of the Five O'Clock Club, an outplacement firm at the epicenter of the economic crisis. Hall coaches businesses on how to execute mass downsizings and often visits companies on the designated day to help coordinate a layoff. Then she speaks to the newly unemployed within 30 minutes of their dismissal and offers tips on how to begin a job search. She comforts those who cry and commiserates with those who vent. She does this, sometimes, with 20 despondent people each day. It is a misery so numbingly constant that it no longer feels miserable. It is her job.

And lately, it is a profitable one. The Five O'Clock Club has nearly doubled in size during the past two years, and Hall has guided more than 200 companies and 1,500 laid-off workers through downsizings in the past six months. The Club, as it is sometimes called, charges each company about $2,000 per fired employee in exchange for providing layoff victims with a year of career coaching. The more businesses that suffer, the better for business at the Club. When Hall joined the company in 2007, she read in the employee handbook that "from time to time, employees will receive small bonuses when the company is doing exceptionally well." Now those bonuses come almost every month.

As Hall sits in her cubicle answering calls, she is surrounded by the evidence of a company expanding at hyper speed. The Five O'Clock Club still occupies an office intended for its first three employees -- a studio apartment inside a Manhattan high-rise, Suite 6L, 460 square feet hidden behind a whitewashed door like all the others, across from a laundry room where tenants come and go in their pajamas.

Fourteen employees now jockey for space inside. A secretary sits at the entryway. Three cubicles are located in what looks like a walk-in closet. Mailing boxes are piled high in the bathtub. Office supplies spill out from the kitchen cabinets. Hall sits under a window in a rear corner, hemmed in by three other desks, with her purse underfoot and four electric fans blowing in a futile attempt to keep her cool.

No matter how frenetic the office becomes, it can never keep pace with metastasizing demands. Years ago, when business was slow, the Five O'Clock Club promised companies that it would contact laid-off workers within 30 minutes of dismissal. It seemed like a reasonable guarantee at the time, when the business coordinated one layoff every few weeks. But now, with layoffs unfolding by the day, Hall clicks open a document on her computer listing recent layoff victims and notices that it is several pages long. "This is crazy," she says. She begins to dial, starting with the names at the top.

An accountant, 42, from San Jose, who earned $95,000: "I know this is hard," Hall says, "but you'll get back on your feet."

A secretary, 59, from Illinois, who earned $45,000: "The timing could actually work in your favor," Hall says. "A lot of people take vacation in the summer. There's no competition for job-hunters."

A publishing assistant, 34, from Queens, who earned $52,000: "Maybe this is a chance to begin your dream career," Hall says. "Follow your heart."

While she talks, Hall stares out the window at a series of concrete high-rises in Midtown Manhattan. There are no pictures on her desk, no books, no snacks, no evidence whatsoever of any personal life. Talk to enough devastated employees while they struggle to pack up the contents of their desks and you learn to keep a tidy workspace. In her time at the Five O'Clock Club, Hall has developed a philosophy that she sometimes shares in her phone calls: Have a job and have a life, she says, but always keep them separate.

She was trained to speak to laid-off workers by reading and internalizing a script in the Five O'Clock Club employee manual -- "Ask: 'How are you doing?' (Just listen to what they have to say and reassure that all will be fine)" -- but so much practice has made Hall the office's new authority. You keep each call to 10 or 12 minutes, she says, because there's always another to make. You try to call on weekends, because that's when people become depressed and eager for contact. You expect 10 percent of calls to involve crying and another 10 to include cursing. You avoid the term "unemployed." These are "job-seekers," or "separated employees," or "affected workers," or "people in transition."

And most of all, Hall says, you remain optimistic on the phone no matter the circumstances. You never mention that 250,000 people lost their jobs in one month. Instead, you say that job loss has slowed, the market continues to recover and the economy is improving. Always improving.

"From what we're seeing, the economy isn't really so bad right now," Hall tells a not-for-profit executive, 51, who earned $80,000. "We're seeing a lot of people bounce back fast and get good jobs."

Near the end of Hall's workday, after 20 more phone calls, her boss comes to her cubicle to discuss the company's upcoming schedule. Kate Wendleton started the Five O'Clock Club nine years ago with the assumption that summers would be sluggish. Bosses are in a good mood; employees are on vacation. It's a bad time for layoffs. But now Hall shows Wendleton a color-coded schedule that includes at least 14 downsizings in July and August, plus seven listed as "possibilities."

"Can you believe this?" Wendleton says.

She studies the schedule and notices that one downsizing needs to be added, a request that came in a few days earlier: the Brooklyn Public Library. Thirteen people. Its first downsizing in a decade. Monday, July 6.

"The HR people sounded pretty nervous," Wendleton says. "We should be there to help them through it."

"Okay," Hall says. "We can do that."

* * *

Wendleton makes her first visit to the Brooklyn library for a consultation six weeks before the layoffs. She brings David Madison, her co-director, and they hide their shoulder bags as they walk through the front door so nobody sees the Five O'Clock Club logos printed on the fabric. They have become masters of the inconspicuous business meeting, sometimes visiting human resource directors after hours or renting temporary office space to convene in secret. Wendleton greets the library's receptionist and tells her they have an appointment scheduled for 1 p.m.

"May I ask whom you're representing?" the receptionist asks.

"It's just Kate and David," Wendleton says. "They're expecting us."

They walk upstairs to the third floor, past a security guard, through a locked door, into a sea of cubicles and through another locked door into Larry Jennings's office. Jennings, director of human resources, invites them inside, shuts the door and closes the blinds. Wendleton reaches into her bag and pulls out a white folder with a label that reads: "Confidential: For HR Officer."

Thirty years of experience in human resources has convinced Jennings that hiring an outplacement company is a smart move, even if it will cost more than $15,000. Jennings must lay off several people he describes as "long-timers" -- career employees who have not looked for a job in decades and need help building contacts and designing résumés. He also believes the Five O'Clock Club might save the library money in the long run by helping it avoid lawsuits for wrongful termination. He proudly tells Wendleton that he has never been sued. She gives him a brochure promising that: "The outplacement coach can redirect anger or anxiety away from the organization and . . . encourage them to sign their severance agreements so they can get on with their lives."

For fear of lawsuits, some outplacement firms advocate downsizings that avoid any impulsive or personal conversations. Instead, they tell companies to use what is known as the surgical method: terminations that last about 15 seconds each, after which former employees are ushered off company property.

"Doing that scars people for the rest of their lives," Wendleton says. "There's a better way."

She opens the confidential folder and pulls out a Five O'Clock Club booklet titled "How to Terminate Employees While Respecting Human Dignity," which includes inspirational quotes about compassion from Theodore Roosevelt, George Lucas and the Dalai Lama. The introductory chapter asks managers to approach layoffs with the understanding that, "unlike facilities and equipment, humans have an intrinsic worth beyond their contribution to the organization." Wendleton flips to a section called "Say a Kind Word," in which a lawyer offers phrases that managers can use during a "compassionate downsizing."

"George, you've been a trooper. I'm sorry that this organization has moved in a different direction."

"George, you have made many good friends here. We hope those friendships will continue."

"George, we realize that loss of employment is undoubtedly a difficult experience."

"George, you have made considerable and long-lasting contributions and they are acknowledged and appreciated."

When Wendleton began her outplacement business in 2000, she wanted to humanize the layoff process. She had worked as chief financial officer for another outplacement firm, which provided space for job-seekers in a Manhattan office. There, the unemployed could sift through job listings on computers with little supervision and infrequent counseling. The format failed, Wendleton believes, because the job-seekers were left alone to flounder, so she built the Five O'Clock Club on the concept of support. Every job-seeker gets a certified personal coach. Every job-seeker attends regular group meetings and finds a sponsor, similar to Alcoholics Anonymous.

Most important, Wendleton decided, every job-seeker is sent into unemployment with decency. She vows never to work with companies that use the surgical method.

"You have to say a kind word," she says.

"Yes," Jennings agrees. "A departure with dignity. We want to give them that."

Jennings tells Wendleton that he will write a script for his layoff conversations and spend a few days role-playing with an HR colleague. In return, Wendleton promises to send three counselors from the Five O'Clock Club to the library for the layoffs. Kim Hall will also come to supervise the counselors and offer advice.

On the eve of the downsizing, Wendleton and Hall hold a conference call to prepare the counselors joining Hall at the library.

"These people have just been fired, so they're not going to absorb a thing, most likely," Hall says.

"They'll be shocked," Wendleton says.

"Stunned," Hall says.

"Feel free to try to build a relationship," Wendleton says. "Ask them where they are from and then say, 'Oh, my mother lived there.' You know, get a conversation going."

"It's really important for them to think we care," Hall says. "And we do care, and we want them to know that we care. . . . They are going to have a lot of issues, so be prepared to listen."

* * *

On Monday after a holiday weekend, Hall wakes up at 4:45 a.m. and begins the commute from her New Jersey home to the library in Brooklyn. The forecast calls for 90 degrees, but Hall wears black pants, black high heels and a black tank top under a black sweater. It is best, she says, to dress "somber, like to a funeral."

Hall has been on location for dozens of downsizings during the past 18 months, but each one makes her thinks back to her first. It was a small public relations firm in New York that fired two employees in early 2008. Hall walked into her appointment and found a woman in her mid-30s curled into the fetal position. She was sobbing and tugging her hair. A panic attack. Hall stepped out of the room, took a deep breath and then reentered. She dug into her bag for the intake form -- name, age, salary, phone number and address -- that the Five O'Clock Club completes for each laid-off employee. "Let's both focus on filling out this sheet," Hall told the woman, and the intake form is what Hall has concentrated on in every meeting since.

She arrives at the library an hour before it opens to the public, joining the three Five O'Clock Club counselors. Jennings meets the group in the lobby. "We feel a lot better having you all here," he tells them. Then he leads them upstairs to begin an unconventional tour.

Here, on the third floor, is the Trustees Room, one of the locations where employees will be fired. Original portraits of library founders hang on the wall, and 17 blue leather chairs surround a wooden table that is adorned with a small stack of severance forms and a single box of unopened tissues.

Here, down the hall, is the desk of the HR secretary, a woman who holds the key to the employee bathroom. But please remember that the secretary will be terminated at 11 a.m., at which point responsibility for the key will be transferred to somebody else.

Here, on the top floor, is the ParkView Restaurant, which will serve free hamburgers and hot dogs to Five O'Clock Club employees so long as they order before 1 p.m. That's when all four cooks will have to leave for afternoon appointments in the Trustees Room, and the ParkView will close for good.

A few minutes before 9 a.m., Jennings and Hall stand in line at the ParkView and order coffee. The head cook greets them and waves. Jennings takes his coffee black and follows Hall to a table in the back.

"I've been getting coffee from these guys every morning for seven years, and now I've got to break this news to four of them," he says. "It makes me nauseous."

"You should eat something," Hall says, offering him her own bowl of tropical fruit.

"I can't," he says.

"Believe me," she says. "You have to take care of yourself first."

The day's first layoff is 10 minutes away, and Jennings reviews the procedure one final time. Each employee will be fired by a direct supervisor and a representative from HR in a 45-minute meeting. All layoffs will be blamed on "a difficult economy that cut the library's budget by 5 percent," Jennings says. Each victim will receive at least three compliments before being offered a severance agreement. Hall will then direct terminated employees into private sessions with Five O'Clock Club counselors.

"If your meetings don't last 45 minutes, that's okay," Hall says. "Some of these people are going to hear the news and say, 'Okay. Fine. Get me out of here.' "

"What if they take it personally?" Jennings asks.

"Be prepared," Hall says. "Some people always do."

Jennings leaves for his first meeting, and Hall retreats downstairs to wait. She checks her cellphone, stares at the clock, asks the receptionist for the bathroom key, reads a book, studies her nails, and paces between her chair and the window.

And now, the first layoff victim. It is a middle-aged woman, not much older than Hall, with her head bowed and a distant stare in her eyes. She is a fundraiser with less than three years experience. Hall stands up and greets the woman near the door.

"We'd like to take you into another meeting that will help you think about what's next," Hall says, her voice barely louder than a whisper. "Are you ready?"

The woman shrugs.

"It won't take long," Hall says.

The woman shrugs again.

"I think it might help," Hall says.

"Okay," the woman agrees, her eyes still on the floor.

Hall guides the woman out the door and points her into a nearby conference room, where a Five O'Clock Club counselor is waiting. A few minutes later, the counselor steps out and hands Hall an intake form completed in printed handwriting. The former fundraiser is Five O'Clock Club client number 23543.

It is the beginning of another good day for the Five O'Clock Club. Hall spends the next five hours watching despondent people walk into meetings and new clients walk out.

Client 23544 is a woman in her early 30s with what appears to be tear stains on her blouse, a receptionist who just surrendered control of the restroom key.

Client 23547 is a computer technician who leaves her termination meeting after four minutes and blows past Hall to go home.

Client 23548 is a well-paid executive who walks quickly from one meeting to the next, saying only that, "You could tell this was coming."

Client 23546 comes through wearing a white chef's coat and carrying a signed severance agreement, eager to get back home to care for a mother who has Alzheimer's.

"I know what these people don't," Hall tells a counselor as the layoff parade continues. "They will suffer for a while and then move on to something else. That's how it goes. Eventually, they'll be okay."

At 3 p.m., after the last dismissal meeting, Hall packs her purse and walks upstairs to Jennings's office. His door is closed, and he is sitting silently in front of a computer that is turned off. His tie is twisted and his shirt is coming untucked. He has not slept for 30 hours. He has just lost 13 employees. Hall has just accrued 13 clients. They sit for a second in awkward silence.

"It's never easy, but you did this the right way," Hall says, finally.

"I know," Jennings says, "but it's still going to take me time to get over it. It's exhausting."

Hall walks out of the office, down the stairs, onto the street and into a subway station. She closes her eyes on the train and rubs her temples. A headache. Another damn headache. She gets off in Manhattan, enters an apartment high-rise and takes the elevator to the unmarked Five O'Clock Club door on the sixth floor. Inside, 13 people are banging on keyboards and answering phones. Business is thriving. Hall asks: "What did I miss?"

A publishing house needs to lay off 18. Another library plans to fire 10. At least two dozen new clients are waiting to be called.

"A typical day," Wendleton says.

"A typical day," Hall agrees.

She walks back to her desk, picks up her phone and dials. The first call is to a salesman, 53, unemployed for only a few hours.

"It's really a good time to start searching," Halls tells him. "Things are beginning to look up."

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