What Is Outplacement and How Can It Help You During a Reduction Event

February 06, 2024 by Rebecca Ahn

A document with a star on it.
Request Pricing

Compare our rates to other providers

Offboarding employees during a layoff or reduction in force (RIF) can be a challenge for even the most seasoned HR professional. It’s a stressful event for everyone involved. Cutting down a workforce has never been easy. Both the exiting employees and managers are bound to experience emotional turmoil as they prepare to face this new transition. 

The good news is that outplacement services can make this delicate process a whole lot easier for both the employer holding the reduction event and for the employees being let go. But what is outplacement and why is it important? How can you make sure that you’re performing a reduction event with the proper outplacement provider?

In this guide, we will explain what outplacement services are and when you might need them, as well as explore the features to look out for when shopping for the right outplacement services partner for your organization.

New Call-to-action

What Is Outplacement?

Outplacement is a service provided by an expert firm to an organization’s displaced employees to help them reorient in the job market and make a successful transition to a new role outside of the original company.

In other words, outplacement helps take the stress out of layoff events for employees who are impacted, giving them the tools they need to find new work in a fulfilling role that they will love. Not only does this help them get back to work quicker than if they were to do the job search alone, it also helps employers ensure that their staff members are set up to succeed whenever they are let go.

Outplacement providers come in all shapes and sizes from boutique shops to huge firms. Many companies often go with providers who are boutique enough to be flexible, but powerful enough to handle a large number of employees if needed. If you are shopping for outplacement services, you should aim to get the best of both worlds.

Outplacement is typically offered with severance during the layoff process. By making outplacement a part of the severance package, organizations can better protect their corporate and employer brand from being tarnished if they should need to reduce the size of their workforce via layoffs or permanent RIFs.

Let’s dive a bit further into this and other situations when you might want to offer outplacement services.

When Do Companies Use Outplacement?

A business typically seeks outplacement services in preparation for a layoff or reduction in force (RIF) event that needs to take place. These events may be due to a variety of reasons, such as employee redundancies, reconstruction, or budget cuts. 

Here are some of the most common situations for conducting a layoff or RIF event in which you may need to consider offering outplacement support for your impacted employees:

  • Restructuring
  • Downsizing
  • Reducing operational costs
  • Plant closures and office relocations
  • Poor business performance
  • Poorly performing employees
  • Merger or acquisition by another company
  • Facing uncertainty of the economic climate
  • Changing the strategic direction
  • Supporting staff with career changes

New Call-to-action

What Services Do Outplacement Firms Offer?

There are many different flavors of outplacement providers to choose from. They all share the same end goal of helping laid off workers get back to work in a new, meaningful role. However, the approach taken and services offered to achieve this end result can differ quite a bit. 

The best outplacement providers utilize the powers of technology to deliver service to these workers anywhere and at any time. They pair this modern approach with online resources, personalized job search counseling, and expert career coaching to ensure that they can fully explore their options and find placement in their ideal next job in the shortest time possible.

Let’s look at the typical services offered with outplacement support, across different types of provider approaches.

Career Transition Coaching

Outplacement services always involve some form of career coaching. Participating employees are usually paired up with career transition experts in their field early in the process. These outplacement coaches will help the employees assess their strengths and weaknesses, draft and optimize their resumes, create and update social accounts like LinkedIn, prepare for interviews, and navigate job postings to identify the next ideal step in their career.

Traditional outplacement providers typically onboard participants by having them visit their offices or attend a webinar (usually as a large group). While there, a coaching staff helps them start their job search by looking over resumes and LinkedIn accounts. However, modern outplacement providers have discovered that this doesn’t make a lot of sense. 

Nowadays, outplacement providers worth their salt utilize the powers of modern technology to provide support to workers across the country and even the world. They provide one-on-one career coaching with a dedicated coach and the option to choose if participants will do their meetings in-person or virtually. The vast majority of participants prefer virtual, because it gives them the freedom to use outplacement services from the comfort of their home and at times that work best with their schedule. 

Coaches should be the most flexible part of the process, adapting to the needs, goals, and experience level of each participant–from senior executives to individual contributors–while also keeping them focused on making the right career decisions. Think of these coaches as more of expert guides who know the ins and outs of the job market, how to use technology to get noticed, and how to handle the whole process from applying to accepting a new role.

Platforms and Learning

While career coaching is the human element of outplacement services, some firms also offer a wealth of career knowledge in the form of online databases, tools, training, and other resources. This allows the employee to research their next job and come up with new strategies to get that job on their own time. This is another way that a technologically-driven outplacement can be flexible based on the client’s needs.

Modern outplacement providers understand how the current job market works. Gone are the days of ‘hitting the pavement’ to find a role. Everything is online now. This includes knowing how to optimize online profiles and navigate the online job search process to help participants stand out among the crowd. This also means understanding how to get resumes past Applicant Tracking Systems (ATS), which filter out resumes based on search criteria before they even land on the desk of a real human. 

By providing this level of support, employees will be able to get back into a new job without completely exhausting their severance check, reducing their stress levels and protecting your company in the process.

6 Questions to Ask Potential Vendors in an Outplacement RFP

What Are Outplacement Features to Look for?

To fully answer the question, “What is outplacement?” it’s also important to understand what are the most important features to look for in outplacement services. As we mentioned, all providers want the same thing for their clients and participants–to get them back to work as fast as possible in a job that they actually will flourish in. However, the specifics of how they provide this support vary widely from firm to firm. 

Let’s break down each element that you should be looking for in your search for the best outplacement services provider for your organization.

Until Placement (or No Term Limits)

The first critical element to look for is term limits, or ideally the lack thereof. Most outplacement providers work with participants for a set period, usually a few weeks to a few months. Once that time frame has elapsed, the services end and participants must continue the job search alone if they haven’t yet found a new placement. This is a huge red flag that these firms lack faith in their abilities, and care more about their bottom line than providing the best service possible.

At Careerminds, we offer our outplacement services “until placement,” or until all participating employees are placed in a new, meaningful role that they will love. This means being flexible and providing unlimited support regardless of a participant’s job title, experience level, or career path. We believe that outplacement firms should work with participants until they are placed, however long that takes. We know that our service works and are willing to put our money where our mouth is.

No Retainer Fees

Retainer fees are also good to be wary of. They allow outplacement firms to make money without doing much work, which is great for them and bad for you. It’s understandable to want a provider on hand for any impending needs, but it may not make sense to keep them waiting around for such a hefty fee. Your outplacement provider should be a strategic partner that works with you for no retainer fee because it’s more about giving your organization and employees the support you need. At Careerminds, we do not use retainer fees at all. We believe that outplacement is an important service all companies should utilize and retainer fees shouldn’t get in the way of that.

Cutting-Edge Technology

As technology continues to advance, outplacement providers should be evolving with it to make their services as relevant, accessible, and easy to use as possible. This means offering virtual outplacement solutions that provide participants with flexible coaching support, eLearning courses, social networking, and online job search tools, while simultaneously preparing them with the same valuable technological skills. You need an outplacement provider that doesn’t just understand the current market, but also the market of the future and how to prepare for it.

Flexibility and Customization

The benefit of a strong technological backbone is the flexibility it provides. There are a lot of variables at play in finding work that changes from person to person. Your provider should be prepared to customize their outplacement process to each participant’s needs, circumstances, goals, and level of experience. Outplacement isn’t about getting employees back to work in any job, but rather into jobs that they want, are good at, and find meaningful. 

Expert One-on-One Coaching

When choosing your ideal outplacement services provider, be sure to thoroughly evaluate the career coaching services they offer. Are their coaches professional and experienced? Is their coaching provided on a one-to-one ratio or in groups? Are they flexible enough to handle the needs of different types of people, from entry-level employees to senior executives? Are they assigned to employees at random or do they try to make relevant matches? Having the right dedicated coach is an important factor that contributes greatly to success.

Thought Leadership

Outplacement firms should be more than merely a tool that gets your staff back to work and protects your business. These firms should be thought leaders in the HR space, keeping up to date on all of the latest trends, providing you with access to industry experts, and devising ways to help your company navigate any potential issues that you may face on various career transition topics. If your provider is tech-driven and connected to the HR landscape, they can and should be a bastion of industry knowledge that you can lean on to make sure any of your transition needs are covered in the best way possible.

Here’s Careerminds CEO Raymond Lee discussing the topic to give you a better example of what thought leadership looks like:

A True Partner

The end goal is to find an outplacement provider that can be a strategic partner for your business. So it’s important to consider all of these criteria from the beginning of your search–or evaluate your current provider if you already have one–and then continue to reevaluate them as your partnership progresses. You need to ensure that as the job market changes, your outplacement provider changes along with it to stay on the cutting-edge of technology and trends, maintain flexibility and transparency with you as a true partner for your business, and assure you that your employees are in good hands.

Proven Results

The final element you need to find the best outplacement firm for your organization is the demonstration of their results. This includes assessing their past case studies, reviews, and engagement rates. It also means ensuring their outplacement services include transparent participant data, surveys, and results that you can review throughout the program to monitor their progress. This will help you see just how effective the outplacement is–or could be–for your staff and business, so you can make the right decision and measure the return on your investment.

Outplacement: Final Takeaways

In summary, outplacement is a great way to get your employees back to work after a RIF or layoff. The best outplacement firms should have a proven path to help make this happen, by utilizing flexible career coaching alongside digital platforms to ensure your outgoing employees have all of the tools they need–wherever they are and at any time they want–to find a new, fulfilling job at another company.

At the end of the day, outplacement shouldn’t be stressful for you or your employees. Your outplacement provider should be a thought leader on the cutting edge of technology that researches and finds solutions to upcoming HR problems. They should be a strong strategic partner that empowers you to perform the needed reduction without all of the stress. 

The most important thing about outplacement is that you’re doing it for your employees. Sure, there are advantages with outplacement for you and your company, but HR is about putting people first. That’s also our core philosophy here at Careerminds.

If you want to learn more about what is outplacement at Careerminds, or have questions about the overall process, we’d love to chat with you. Careerminds is dedicated to getting people back to work in their dream job.

Click below to schedule time to chat with one of our experts and see if Careerminds is the right partner for your organization’s outplacement needs.

Speak with an Outplacement Expert

Rebecca Ahn

Rebecca Ahn

Rebecca is a writer, editor, and business consultant with over 10 years of experience launching, managing, and coaching small to midsize companies on their business, marketing, and HR operations. She is a passionate people advocate who believes in building strong people, teams, and companies with empowering culture, content, and communication that facilitates meaningful results at every level and touchpoint. In her spare time, Rebecca is an avid traveler and nomad who also enjoys writing about travel safety and savvy. Learn more on her LinkedIn page.

In need of outplacement assistance?

At Careerminds, we care about people first. That’s why we offer personalized talent management solutions for every level at lower costs, globally.

Speak with an Expert

Log In Contact Us