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One in two people in the NZ workforce are at high risk of burnout, according to Massey University’s latest wellbeing@work research. That number has doubled since December 2023 and it’s a statistic that should ring alarm bells for employers around the country.
Wellbeing@work head, Professor Jarrod Haar, attributes these high numbers to people worrying that their job is under threat because their company has recently made redundancies.
With changes in the job market, those who believe their job is under threat has gone from 22% in December 2023 to 48.4% in April 2024, and people with high job insecurity are 14.5 times more likely to be experiencing burnout.
Professor Haar says burnt-out workers are 16.5 times more likely to consider quitting and 28.5 times more likely to engage in poor work behaviours, including slacking off and not trying.
Is your organisation doing enough to protect your people from feeling stressed or burnt out? We spoke to psychologists and change management experts to understand how employee wellbeing can be affected by restructuring and redundancies, and how to manage these processes so you can minimise stress and disruption.
Give your employees clarity on what’s ahead
“Human beings need certainty to do their best work,” says Dr Fiona Crichton, VP of Behavioural Science at workforce science platform, Groov.
High uncertainty is extremely detrimental to performance, she explains. In fact, studies show that you’re at your most stressed when there’s a 50/50 chance that you’ll lose your job.
“If you’re 100% sure [your job will end], you’re less stressed because at least you know where you stand and you can make plans for the next steps,” she adds.
In workplaces that have been through a reorganisation, employees can experience survivors’ guilt. They may be unclear as to ‘why them and not me?’, which can leave a residual feeling of, ‘I’ll be next’. This catastrophising can create feelings of isolation, which further undermines wellbeing and work performance.
Fiona’s message to employers is to give clear information to your people.
“Clarity is kindness, so if you’re making job redundancies, keep people in the loop and impart information early. Communicate clearly, often, and in person. Don’t email,” she says.
Even if you can’t completely reassure remaining people that there won’t be more restructuring, if you’re clear about what’s next, then communicate all the information across the company and not just to the department that’s been affected.
It’s also crucial to allow employees to discuss their feelings before transitioning to new plans for the future, says Fiona. Schedule a dedicated time for people to express their emotions, process the situation, and then move forward with the company's future strategies.
“There may be some uncomfortable feelings, people may share anger and concern, but being able to talk honestly and openly helps people move past tough emotions and build connections within the team left behind.”
People usually find this process cathartic, and feel valued and grateful that they can express their feelings authentically. Then they will naturally start to focus on what’s ahead.
Be clear about role expectations
There should also be absolute transparency about what people’s roles are post-restructure, or else this will be a source of stress for employees.
Make sure everyone has detailed job descriptions, and it’s a good idea to revisit job expectations and individuals’ roles, Fiona says.
“If someone’s role has been folded into someone else’s role, then rewrite the job description so you’re making it clear what the parameters of the new role are.”
Then go over what is expected on a weekly basis, she advises.
“As a leader, to cultivate a high-trust relationship, you have to be aware of each team member’s job demands on a week-to-week basis, and if they’ve taken on more responsibilities than is feasible, you need to be able to help them prioritise what needs to be done.”
If disestablishing a role, you have to mean it
If you’ve disestablished a role, you need to stop doing the things that role involved and focus on the capacity you have, to be able to deliver in your chosen areas, says Nick Mackeson-Smith, director of specialist performance consultancy, Five NZ.
If you’re letting people go and that work is still required, then there’s a problem, he warns.
“It’s unfair to expect those to step up and do more with no broader recognition,” he adds.
“It’s hard. Some business owners can’t afford to pay for all their people, but if that’s the case and you’re letting people go, then you need to realise that less work can be done with fewer people,” he explains.
Meanwhile, the offboarding experience is very important, helping departing employees close things off, says Nick.
If the role is disestablished, and the work is no longer required, they’re not handing things over, they’re “closing things off”. This is critical, he says.
“For example, if I tell the guy who cleans my pool that I don’t need him anymore, you can’t expect to go swimming in a clean pool anymore unless you clean it yourself,” he explains.
You hear all the time from employers that: ’we have to do more with less’. And sometimes you can deliver more because the work that was being done wasn’t the right work – ultimately it comes down to what truly matters.
“But if it does matter, then fund it. If not, don’t do it,” says Nick.
Involve employees in the new structure and job design
Employees aren’t always clear on how the new organisational structure is intended to work, says change management strategist, Jane Judd.
They might know who is left behind, they might know the roles or the titles of those left, but they’re not clear how the work is expected to be redistributed among the roles.
She says any reduction in staffing levels should be accompanied by a plan for (and communication about) what the remaining employees need to start, stop, and continue doing.
“Reducing resourcing levels will reduce output, and productivity will only increase if people are clear about where to focus effort. Doing the same with less needs strong evidence and measurement base to ensure it is achievable,” she adds.
Involving employees in redesigning their new roles and the way things will work in the new structure will mean they are more likely to commit to the new ways of working. It will also highlight where the risks lie.
Jane says autonomy and agency are important for the employees left behind after a restructure.
“It’s about empowering them to do something they’ve got control over.”
If they’re not asked and not told, and there’s a new organisational chart on the wall that doesn’t tell people what to do tomorrow, you could lose more people, she warns. And after a restructure it’s harder to recruit.
Spend time developing new teams after layoffs
It’s quite likely that teams will have changed after a restructure, with different people working with others for the first time.
Employers must address this. If the team is badly run, this will be a cause of stress and take away from productivity, says Dr Fiona Crichton, so it’s a good idea for team members to collaboratively set team values, practices, or cadences.
“This is a bonding experience and can really help with team cohesion. Agreeing how they are going to communicate as a team, how they’ll commit to decisions and operate together sets the stage for future team success,” she explains.
“Teams that know each other feel less isolated, and having those points of contact in a new team, people are quicker to get on the same page.”
Doing quizzes together can be a fun and effective way of getting to know each other, and starting meetings with a regular catch-up about people’s afterwork activities can help build a stronger team.
As a leader, you should know what helps your people unwind. You need your people to be switching off to sustain their focus and energy, Fiona adds.
Employees may be less productive post-redundancies
Productivity often takes a dip after a restructure, especially if employees feel the process is being done to them rather than with them, says Nick Mackeson-Smith.
If they can’t be engaged and involved in the process, that’s stressful. And people don’t focus on getting work done if their role is at risk, he adds.
Employers also need to be mindful that not all staff members are going to want to do more in the new structure.
There’s often this belief from the leadership that everyone wants to grow and do more, that every employee wants more responsibility in the restructured company.
“But if I’m a carer at home, for instance, and can only work an 8am until 3pm day, and just want to do the job I love, I’m going to resent these demands,” he warns.
How leaders behave matters
Canterbury University Psychology Professor, Katharina Naswall says the way your employees work and feel post-restructure will depend on how well you and other business leaders behaved in the company reorganisation. Were you seen to be supportive of the people who were laid off?
The psychological contract between the employee and employer is vulnerable, she explains. The understanding has been: ‘I expect to have my job as long as I do my job and my employer will be respectful, to tell me in an upfront way [what is happening].’
If the employer is perceived to have broken the psychological contract with their employee, it’s the same mechanism as with a personal relationship. They’re feeling disappointed, and let down, which is not a great place to be, she says.
“For the company then to ask their employees, who feel betrayed, to go at the same pace, people don’t want to make the effort,” she explains.
“People aren’t being difficult, they’re going through grief, feeling let down by someone they trusted. It’s not change resistance, but they’re tired, they end up still functioning but they’re going through a certain amount of stress,” Katharina explains.
To restore the relationship, companies and their leaders have to prove that they’re trustworthy, acknowledge the hurt and use a lot of people skills.
Why employee wellbeing is so important
As a business owner, your business brand’s reputation will be eroded if your people feel overworked and that they’re not able to get everything done, says Fiona Crichton.
Celebrating what your people are achieving is key to keeping them motivated.
“They have to feel like they’re being seen and that their work is contributing to goals and the wider organisation’s mission,” she says.
After a restructure, the people remaining need love, says Nick. “Be overly consultative and caring about how things will be run in the new streamlined company."
Talk to your team about how they feel, and what they need and give them some space to prevent burnout, he advises.
