Stealth layoffs are like sudden disappearances: one minute, your colleague in the adjoining office is there, like every other day, and the next minute, POOF!, he’s gone. Vanished. Disappeared.
Firms use stealth layoffs for a variety of reasons. First, they are used to counter associate morale problems. Job security is important, and firms know that people care about keeping their jobs. So why call it a termination, or a firing, when the individual simply “resigns” for whatever reason? Why induce hall chatter and nervous gossip when it’s needless? Morale among associates and staff at Silicon Valley law firms was at an all-time low during the tech bubble burst: everyone was afraid, and associates knew their jobs were in jeopardy to summer associates who would likely replace them. It’s an extremely difficult environment for anyone to work in when the big elephant in the room, the RIF, is omnipresent. So stealth layoffs are a way for firms to prevent the elephant from entering the room.
Second, there is the issue of firm reputation. Some firms like to say that they never let go of any associates or staff. All of them “willingly” depart for one reason or another. It makes for a great “feel good” story, and entry-level attorneys believe it. They really do. Reputation is very important to law firms. How one is perceived, vis-a-vis the major competitors, is a delicate orchestration of marketing and image-building exercises. The stealth layoff is one instrument playing in this orchestra. No firm wants the reputation of firing their attorneys or staff. Clients don’t like it either. Firing suggests incompetence, and unfortunately, incompetence inevitably bleeds its way back to the partners themselves. Why does your firm fire so many people? Why are you unable to select competent attorneys in the first place? Is your hiring process flawed? As a client, why am I paying for the time of someone whom you just fired?
Third, there’s the issue of associate or staff reputation. The individual being terminated is going to need to find a new job, most likely at another law firm doing exactly the same work. It’s not in that individual’s best interest to get fired, making it that much harder to obtain that new job. Instead, the associate “seeks a better opportunity” at another firm that “fits his long-term career development.”
So stealth layoffs fulfill their purpose, and they further both the interests of the partners as well as the individual being laid off. But query this: do stealth layoffs help or hurt associates who end up staying?
