Is e-mail the new pink slip? RadioShack laid off 400 electronically; Will others?

HR Magazine, Nov, 2006 by Erin Binney

Companies use e-mail to receive resumes, introduce new hires and announce promotions. Now at least one is also using it to administer pink slips.

In August, RadioShack Corp. notified about 400 employees at its Texas headquarters by e-mail that their positions had been eliminated. And just a few weeks earlier, a London-based body-piercing and jewelry shop reportedly fired one of its sales assistants via a text message.

[ILLUSTRATION OMITTED]

So is "cyber-firing" the way of the future or an example of gross mismanagement--or both?

Ken Siegel, a management consultant and organizational psychologist, believes that RadioShack chose "both a lazy and cowardly way" to let its employees know they had been laid off. "Doing it electronically just fundamentally, at its core, shows a basic disregard for the well-being and level of respect toward other people," he said.

But the electronics retailer maintains that it took every measure possible to ensure that all employees were treated with dignity and respect during its reduction in force (RIF). For example, it told employees ahead of time how and when the RIF would take place, directed affected employees to meet with their supervisor and with HR following the e-mail notification, sponsored a private job fair for affected employees, and provided counseling services to terminated employees as well as remaining employees.

'Impersonal and Public'

Ruth Haag, author of Hiring and Firing (Haag Press, 1999), said RadioShack showed good management techniques by letting employees know about the RIF in advance and providing them with career transition resources.

The company's misstep, she said, was using e-mail to make contact because "e-mail is impersonal and public."

In an e-mail to HR News, Wendy Dominguez, RadioShack's corporate media relations manager, said the company considered a number of ways to convey the news to affected employees but decided to use e-mail because it was the most private option. "A person coming to their cubicle, or a letter or memo delivered to their cubicle would be much more openly visible and, we felt, invasive," she wrote.

But Siegel said that it is imperative to tell an employee face to face that he or she is being terminated, and that using e-mail is particularly inappropriate. "I think that it is [an] ultimately dehumanizing way of telling someone that you're taking their livelihood away, no matter what excuse you may have for doing it," he said.

Haag added that e-mail is not a very private means of communication.

"I believe that preserving privacy is very, very important, but I also believe that e-mail is about the least private thing we have these days" because, for one thing, it can be intercepted easily, she said.

Consider All the Effects

Siegel, who holds a doctorate in social psychology, speculates that employees who are terminated via e-mail are likely to remember only that detail, not the steps the company is taking to help employees find another job.

Yet, Dominguez says many RadioShack employees reacted positively to how the RIF was conducted.

According to Dominguez, one employee said, "Being there yesterday, I can say that I was very proud of our company and how things were handled. I've worked with several company RIFs and this was one of the most respectful and helpful that I've seen."

And an organization might want to use an electronic notification process to make sure that the information reaches every affected worker at exactly the same time, reducing the risk that the news will get passed from cubicle to cubicle, thereby raising anxiety.

Even if affected employees are OK with receiving an electronic pink slip, however, organizations may experience reduced morale among remaining workers and a tarnished company image, Siegel said.

Is RadioShack "still going to be able to retain talent?" Siegel asked. "Are they going to be able to recruit talent? And what is their image likely to be?"

What the Future Holds

Dominguez could not say for certain that RadioShack would use e-mail to lay off workers again. She noted that this was the largest RIF the company had ever conducted and that it would determine future strategies on a case-by-case basis.

Siegel says it's likely that electronic terminations will become more common in the future, but an increase in use "doesn't make it any more acceptable."

Even when employees work off-site or telecommute, it's important to meet with them to discuss a termination, Siegel said. "Typically, if you can call that person in for a meeting about their sales quotas, why would you not call them in to help them transition out of the business?"

ERIN BINNEY IS STAFF WRITER FOR HR NEWS.