Communicating layoff news during economic downturns.

• Author: Brunelle, Cari

As we talk to managing partners of firms that had a terrific 2008 in terms of revenue, they are quick to say that only means the firm had a good year last year. Period. In the current economic climate, nothing is certain. As more firms fold their tents or navigate layoffs, caution and honest conservatism are now more important than ever. Law firms can look to the way corporate America communicates as a guide.

If a corporation makes a public announcement about layoffs or restructurings, its publicly traded stock usually rises immediately. Why? Because the market senses that these announcements generally mean corporations are getting their bottom line, operations and balance sheet under control and they will be more profitable in the future.

Now layoffs and restructurings are actually expected. Socalled "bad" corporate news can then be a relief--it demonstrates that the company is in touch with the times and taking steps to ensure its viability.

Until recently, few law firms understood that cause and effect. In many instances, law firms seem to try to bury their proverbial heads and just wait for the pain to go away.

Last year, several large law firms were brave enough to discuss their layoffs of both staff and attorneys publicly, and many more did it quietly. The first few rounds of attorney layoffs were tied either to a geographic region central to the financial services industry, or to a particularly sensitive practice area such as commercial mortgagebacked securities.

As time passed and conditions actually worsened, more layoffs followed. These new rounds typically occur across the board and across firm departments. For law firms, as for companies, no matter who gets laid off or for what reason, it is critical to prepare. Send out the right messages both internally and externally when the time comes.

Honesty as the Best Policy

First and foremost, firms must have a communications plan to deal with these situations. They should develop key messages for all audiences and prepare for calls from the media. They must be ready to react quickly to reporters' questions and respond with facts and genuine concern for their colleagues who have lost their jobs. It is never easy to have to let go of your partners, associates or other staff. But these are difficult times.

Be honest with the media and provide numbers, even if you don't want to hand them over. Otherwise, reporters will search everywhere (which won't take long) and will go with their own...