Announcing Layoffs in Advance

Corporate disaster is likely when tipping off creditors and employees well in advance of problems that require plant closings. Yet, leftist politicians and their union backers have legislation where employers of a certain size and type must notify employees well in advance of possible plant close-downs.

I can see why employees would like to know early on if they are to be trained for other jobs. But such action may unduly scare employees in the event the plants are not eventually closed.

Often, financial conditions are poor, and finances cannot be arranged properly until the last minute. Once a notification has been made, you may have already lost employees with which you would have been able to salvage the operation.

And then the question of credit. Once the mandatory plant closing announcement is made, the company’s credit may be permanently damaged. Stockholder values, including pension holders and other such institutions may be adversely effected.