Layoffs Aren’t the Risk – Your Selection Criteria Is

When employers determine that a reduction in force is necessary, the focus is often on the underlying business justification. Employers may assume that if a layoff is driven by legitimate business reasons, the decision is defensible. But the selection criteria used to decide who stays and who goes is often where the greatest legal risk lies.

Employers should ensure their analysis does not end with why layoffs are occurring. It is equally important to document how individual employees are selected. Even business-driven termination decisions may create exposure if they disproportionately impact certain groups, including:

· Employees in protected classes (race, age, sex, veteran status, disability status)

· Employees on leave

· Employees who previously requested accommodations

Selection criteria should be clearly defined, consistently applied, and grounded in objective factors. All employees in the affected department or unit should be evaluated under the same framework before finalizing layoff decisions.

Common pitfalls include:

· Reliance on subjective or poorly documented criteria, making decisions more difficult to defend.

· Inconsistent application of criteria across managers or departments.

· Failure to adequately document the rationale for individual selections.

A defensible layoff is not based solely on a legitimate business reason – it also requires objective, consistent execution.

The legal risk in a reduction in force is not limited to the decision to reduce headcount – it is how employers determine who is included.

We Can Help

Our Reduction in Force Management Service supports your organization through the full reduction in force process – from planning and compliance review to documentation and execution – helping reduce legal risk and ensure a fair, well-managed process. Contact us.