Funding cuts, donation dips and general economic uncertainty may have you struggling to keep your nonprofit afloat. The last thing you need is rumormongering among your staff. Employees might understandably be concerned about layoffs — or, at the very least, pay or benefit reductions. But to help ensure your organization remains in the best fighting shape, you need staffers on your side. This requires clear and candid communication about your nonprofit’s financial situation.
Tackle issues honestly
Several years on, some nonprofits are still contending with the effects of the COVID-19 pandemic and higher inflation. The recent rescission of many federal grants and evolving donor behavior due to tax law changes are causing even more financial distress.
So if your staffers are worried about your organization’s future, it may be for good reason. It’s essential for you to be open with them about where you stand now and how you expect to fare in the coming year. You may want to provide some personal opinions to build rapport and ease anxiety. But your core focus should be on the facts and how you’re responding to and anticipating events.
Just knowing that leadership is listening and has a plan will be enough to help some employees go back to focusing on their work. However, they must feel confident that your plan is well considered and likely to be effective. Otherwise, they may discuss their concerns with people outside your organization, which could undermine your nonprofit’s reputation and ability to attract support.
Question of layoffs
Regardless of whether the fear is actually voiced, layoffs may be on staffers’ minds. Before they even ask, broach the subject to show you understand their concerns. Just be careful not to make promises you might not be able to keep. Although it’s fine to talk about the steps you’ll take to avoid layoffs, most leaders would be remiss to categorically deny that layoffs are an option.
It’s not enough to hold one meeting about the state of your nonprofit’s finances and then go back to business as usual. Keep staffers informed with frequent updates, using the methods that are most efficient given your workforce’s size and location. In-person or face-to-face video conferences are best for announcing big developments.
Trouble on the horizon?
It may seem like only last week nonprofits were scrambling to hire enough workers to fill open positions — and, in fact, your organization may still be in hiring mode. But if you see trouble on the horizon, you owe it to loyal staffers to let them know. Solicit their questions and answer them truthfully, even if the only thing you can say at the time is “I don’t know” or “I’ll have to get back to you.” And contact us for ideas about cutting costs and taking other steps before resorting to layoffs.
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