How to Deliver Bad News to Employees at an All-Hands Meeting

Karl Sakas — September 29, 2019 Follow @KarlSakas

In trouble? Here’s how to deliver bad news at your next All-Hands meeting.

If you need to discuss or deliver bad news at your agency, you should gather your employees for a live All-Hands meeting.

But be careful—if you do it poorly, you’ll confuse people… or even make your best employees start looking for a new job. Fortunately, there are plenty of best practices to consider.

Now is not the time to hide behind an email. As a good leader, you need to face your team—to answer their questions and enlist their support going forward. Read on for help!

What kind of bad news needs an All-Hands meeting?

Here are some examples of bad news that that merit a company-wide meeting, to share and/or to discuss:

• You’re having significant financial problems.
• You’ve needed to do a significant layoff.
• A key executive has resigned… and is trying to poach employees.
• You’ve found serious problems, like embezzlement or harassment.
• An employee died, or is currently embroiled in a public scandal.

Sometimes you have time to plan the meeting, like when you know you’re doing a layoff or you know you’ve been having financial problems. See my planning advice last week in Part 2.

But sometimes bad news is breaking quickly, and you need to act quickly. In that case, you may need to call an emergency All-Hands meeting.

Does it have to be a meeting, instead of an email?

Yes, it has to be a meeting. When you meet in person, you benefit from being able to respond immediately to the recipients’ reactions. They can hear your tone and see your facial expressions. None of that’s possible in email.

Bad news is best delivered in person, or else via a live video conversation. Don’t email bad news to your employees, unless you want to make the problem worse.

When it’s this bad, you need a company-wide (All-Hands) meeting, to ensure everyone’s getting the same version of the story. As the leader, it’s your job to share the bad news… and, hopefully, rally the team.

What’s different about sharing bad news?

Considering the advice I shared in Part 2 of this series (about how to plan an All-Hands meeting), bad news meetings are different in a few ways.

When you’re delivering bad news at the All-Hands meeting, expect several differences:

1. Planning: You need to spend more time planning, especially to head off likely problems (because you’re more likely to have problems).
2. Clarity: You need to be especially precise about bad news, including the related numbers, causes, and linkages. People will be dissecting your every word.
3. Reserve: Be careful about your usual jokes or humor; you don’t need to be a robot, but now’s not the time to seem tone-deaf.
4. Monitoring: You should be ready to spend more time after the meeting, gauging employee reactions.
5. Reassuring: You need to prepare for one-on-one meetings, as employees ask for specific feedback on how the bad news impacts them.
6. Tone: You’ll likely see employees to become more paranoid, as they assume other things might be broken, too.
7. Turnover: You’ll find some employees start searching for a new job, even if you know their role is secure.
8. Stress: You’re likely to feel terrible before the meeting… and only somewhat less-stressed after the meeting.
9. Pressure: You’ll feel pressure afterwards, as employees expect you to deliver on improvements.

Sounds fun, right? Better to be prepared than surprised, because an All-Hands with bad news rarely involves good surprises.

How should we share bad news at an All-Hands meeting?

I recommend you cut to the chase. Everyone’s going to be on edge; don’t keep them waiting with your usual pleasantries. Consider this as a framework for sharing the bad news:

1. Summarize the core problem, and how it impacts the agency.
2. Share a high-level overview of what you’re doing to solve the problem (or at least address that you have a plan).
3. Note that you need their help moving forward—but you want to answer their questions before you dig deeper.
4. Take their questions.
5. Dig deeper.
6. Recap what’s next from there, and ideally end on a positive note.

To illustrate this framework, here are some examples based on common bad-news topics.

Examples of What to Say: 3 Scenarios

Here are are sample openings and closings, based on each example topic. Remember, I’m not a lawyer—so be sure to get advice from your lawyer and HR advisor about what to say in your specific situation.

Example #1: Layoffs Across Several Teams

Here’s a sample opening monologue after you’ve just executed a significant layoff. In this case, I’ll assume you’ve gathered people on short notice for an emergency All-Hands meeting, immediately after you did the layoff. The terminated employees won’t be in the room.

Opening: “Thanks for joining us today on such short notice. I unfortunately have some bad news to share. As you know, we’ve lost several clients and have struggled to replace them with similar revenue. We made smaller budget cuts earlier, but those weren’t enough. As you may have heard, we laid-off six people earlier today, each receiving a severance package. I’m sorry we got to this point. If you’re in the room or on the video call now, you are not part of that layoff. We have a plan to rebuild and move forward—including cutting my own salary by 30%—but I’ll need your help. Before we dig into the turnaround plan, I’d like to start answering your questions. What questions do you have?”

In Between: [Q&A, grieving, updates and discussion and input on the turnaround plan]

Closing: “I’m sorry we got to this point; I failed in my role as CEO. I hope you’ll be part of our new future. We can do it, with your help. As you think of other questions, I’m glad to meet with you one-on-one to help.”

Example #2: Pending Financial Problems

Here’s a sample opening monologue when you’re seeing an ongoing slowdown in sales that’s starting to hurt profits, but you haven’t done a layoff yet. In this case, you’re sharing at your next quarterly All-Hands meeting, rather than calling an emergency meeting.

Opening: “Today will be a difficult quarterly meeting, because we’re running into some problems. Specifically, monthly revenues are down significantly after losing clients Acme and Gidget-ron. We’ve implemented a tier of budget cuts in the background, focusing on things that don’t impact employee salaries or day-to-day experience. Our cash reserves are strong, so I don’t currently anticipate layoffs or other personnel cuts at this point. Before we dig into our plan to turn this around, I’d like to start answering your questions. What questions do you have?”

In Between: [Q&A, concern validation, updates and discussion and input on the turnaround plan]

Closing: “This is a challenging time, but I know we can get through it if we work together. If you have ideas to help us, please tell me or your direct manager—we need everyone’s help. I’m glad to meet with you one-on-one, whether you have ideas, questions or concerns. Thanks for being a part of the team!”

Example #3: Fired an Executive for Harassment

Here’s a sample opening monologue when you’ve fired a team member who was harassing employees. At this point, you’ve completed your investigation (internal, external, or both), and you’ve terminated the person responsible. This fits as an emergency All-Hands meeting if the harasser had been someone in contact with many people.

Opening: “As you may have heard, we fired Eric (October 04, 2019). His firing was for cause. Earlier this month, we received reports that he was sexually harassing employees. We immediately asked our law firm to conduct an outside investigation. Several of you spoke with their investigator over the past two weeks about your experiences with Eric. Their investigator confirmed a majority of the reports, and also identified another employee who wasn’t part of the initial reports. Based on our law firm’s report, we terminated Eric (October 04, 2019), and he’s been told not to contact employees or visit the office again. I am sorry this happened—I wish we’d never hired him. I appreciate that people came forward to let us know what he was doing; I wish there had been a red flag. Before we dig into our plan to prevent this from happening again, I’d like to start answering your questions. What questions do you have?”

In Between: [Q&A, concern validation, updates on what’s next]

Closing: “I’m sorry this happened, but I’m glad you reported Eric’s behavior. If you have followup questions or concerns, I’m glad to meet with you to help. Thanks for being part of what makes us better.”

How do we balance speed vs. preparation?

You’ll need to handle this on a case-by-case basis. If the bad news is spreading already, have the All-Hands meeting within a few days. If things are building slowly, you might have a week or two, or even a couple months.

Just remember—the longer you wait, the more the rumor mill churns… and the more likely your best employees will start looking for a new job.

What can go wrong?

Unfortunately, a lot can go wrong. Keep these points in mind when you need to share bad news.

1. Don’t make promises you can’t keep. This will bite you later, since it destroys employees’ trust.
2. Don’t lie. No one expects you to have all the answers; it’s OK to say “we’re still working on that” if that’s accurate. But don’t lie—it’ll burn you later.
3. Try to be upbeat, within reason. If you project that you’ve lost hope, your employees are likely to give up.
4. Don’t look callous. If you’ve done layoffs or imposed salary cuts, you’d better share that you’re cutting your own salary. It’s also not the time to be flying First Class, or telling your employees how you just bought a new luxury car. And if the problem was based on your mistakes, a genuine “I’m sorry” helps.
5. Enlist your leadership team. You need them to back you up when their subordinates ask questions. This takes preparation time, especially if your leaders aren’t initially on board with your decisions.

Thinking about your agency and your team, I bet you can think of more potential risks—what comes to mind?

Should there be a handout or other leave-behind when it’s bad news?

Probably, yes. You may not want to list every single detail, but the handout is your opportunity to control the narrative.

Mention the problem, but then focus the handout on how you’re working to solve the problem—and where employees can help. Now’s a good time to remind that people are welcome to talk to you or their direct manager one-on-one.

Be sure you don’t include material that someone might consider to be libelous. For instance, if you fired someone after finding evidence of embezzlement, you might note, “We discovered a pattern of financial irregularities; based on the extent, we’ve terminated Pat and referred the matter to the police.” That’s likely better than, “We fired Pat because Pat’s an embezzler.”

Be Sure to Read All Three Parts for Better All-Hands

This is the third in my three-part series on doing better All-Hands meetings at your agency.

1. In Part 1, I shared why you and your agency benefit from doing a quarterly All-Hands meeting.
2. In Part 2, I shared how to plan a successful agency All-Hands meeting (including the people involved, tips on content, and how to prevent common problems).
3. Here in Part 3, I shared what to do if you need to share bad news at your All-Hands meeting (and why major bad news almost always merits an All-Hands).

Question: What will you change about how you deliver bad news to employees?

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