Some companies are adopting a new approach to restructuring their workforce, but it’s leaving employees with mixed emotions. These employees receive emails stating that their current job role has been eliminated, but they have not been fired. This strategy, known as “quiet cutting,” allows companies to cut costs and reduce jobs without officially laying off workers. Major companies like Adidas, Adobe, IBM, and Salesforce have implemented this approach over the past year. According to research platform AlphaSense, the number of these reassignments has more than tripled in the last year.
Quiet cutting plays on employees’ fears of layoffs in a weakening job market. While workers remain employed, they are often reassigned to roles with lower prestige, lower pay, and more demanding responsibilities. Some employees initially feel relieved that they haven’t been fired, but they also feel anger and confusion about their new positions. The journalists who first reported on this trend, Ray Smith of the Wall Street Journal, interviewed workers who said that these backhanded demotions took a toll on their mental health. When your identity is tied to your job title and the work you do, being told to do something else, especially if it’s a demotion, can be disorienting and make you question the company’s message to you.
Quietly cut employees also fear that their employers are trying to make them so miserable in their new roles that they will eventually quit. Smith describes this strategy as “passive-aggressive” termination, where the company pushes the employee into a corner and says that if they don’t accept the new position, they have to leave. Companies never explicitly mention that they are “quietly cutting” people. Smith explains that refusing a reassignment or leaving after being unhappy with the new position allows the company to avoid paying severance costs. Ultimately, this approach saves the company money.
In conclusion, “quiet cutting” is a restructuring strategy that is gaining popularity among companies. However, it leaves employees feeling confused, fearful, and angry. This approach plays on employees’ fears of being laid off and often results in lower-status positions with lower pay and increased responsibilities. Some employees even experience negative impacts on their mental health due to these backhanded demotions. The strategy may also be an attempt to force employees to quit without explicitly firing them, thus avoiding severance costs.
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