Outplacement

What is outplacement?

Outplacement is an employer-sponsored service designed to help departing employees transition into new roles by providing career support such as coaching, résumé writing, job search assistance, and interview preparation. It is used by organizations to support employees after termination while protecting company reputation, reducing legal risks, and maintaining workforce morale.

Outplacement services may be provided in-house or through third-party providers who assist employees with job searches, career guidance, and access to recruiting networks, job fairs, and online platforms.

Employers use outplacement providers to give various outplacement services to terminated employees. Providers can help outgoing workers with their job search, impart professional advice, and inform them about job fairs, recruiting firms, and other online services.

What are the types of outplacement?

Outplacement services include a wide range of career support offerings such as coaching, assessments, job search guidance, and personal branding, designed to help employees identify opportunities and successfully transition to new roles. The main types of outplacement services include:

• Job coaching. A job coach prepares people for employment. Job coaches lead individual or group sessions depending on the topic and current needs. A job coach can also extend additional assistance to disabled individuals navigating the workforce.

• Career assessments. Many types of career assessments are available. These tools help individuals understand their attributes and interests, and which kinds of careers and environments align with their skills and values.

• Interview preparation. Outplacement services may practice one-on-one or group interviews with their clients. The preparation likely includes behavioral interview questions.

• Networking events and opportunities. Various networking events and opportunities may be available to outgoing employees. Industry-specific speaking engagements, happy hour meetups, and roundtable events are common examples.

• Résumé and cover letter writing. An outplacement firm might lead résumé and cover letter workshops or reviews. These services could be one-on-one, or a firm might conduct group classes. 

• Job search guidance and support. Outplacement providers may offer guidance in one-on-one settings to help outgoing employees identify new jobs that match their skills and interests.

• Personal branding and social media optimization. Experts in social media and personal branding can help individuals enhance their LinkedIn accounts and create memorable profiles.

• Negotiation skills. Job seekers may want to negotiate their salary, a sign-on bonus, paid time off, or other benefits before accepting a new position. Outplacement providers can coach individuals through the negotiating process.

What are the benefits of outplacement?

Outplacement services benefit both employers and employees. Regardless of whether an employer chooses to offer in-house or third-party outplacement services, advantages include faster job transitions, reduced legal risks, improved employer branding, cost savings, and stronger workplace morale. Let's understand these in detail:

• Positive brand image. Reorganizations, workforce reductions, layoffs, and other forms of terminations can negatively impact the morale and productivity of employees who stay. If handled properly, outplacement services create a positive brand image and show remaining employees that the business is playing its part in supporting former employees beyond a severance package.

• Reduced risk of legal trouble. Unlawful termination cases are costly, time-consuming, and complicated. Outplacement services provide a layer of protection to show that the business took appropriate action when letting employees go. Offering outplacement services supports a healthy relationship between the company and outgoing employees, and therefore reduces the risk of wrongful termination lawsuits.

• Cost-savings. Employers can offer outplacement services alongside or instead of severance packages. In some cases, it may be cheaper for employers to use outplacement services than to pay a severance based on salary. Additionally, outplacement helps outgoing employees find new roles more quickly, enabling them to switch to their new company’s insurance plans, saving their former employer more money.

How do you choose an outplacement firm?

Choosing the right outplacement firm involves evaluating customization options, budget alignment, and provider expertise to ensure the services meet both organizational and employee needs. Key considerations include:

• Customization ought to be top of mind. Outplacement services should be adaptable and customizable to meet the needs of the organization and its employees. To fully understand customization capabilities, employers must ask outplacement providers what types of services they have, how those services work, and if they are generalized or specialized.

• Businesses need to understand their budget. When exploring various outplacement services, understanding budget limitations is crucial to finding a provider with as much value as possible. Knowing its budgetary constraints also helps the company's decision-makers rank services and determine which ones are non-negotiable.
• Companies should check for experience and expertise. It’s important for employers to research how much experience the outplacement firm has in order to understand if it’s a good match for employees. It‘s useful to know if the firm has relevant industry-specific knowledge that will benefit employees.

Frequently asked questions about outplacement

Below are the commonly asked questions about outplacement.

Q1. Why do companies offer outplacement services?

Companies offer outplacement to support employees after layoffs, reduce legal risks, and maintain a positive employer brand.

Q2. How long do outplacement programs last?

Programs can last from a few months to a year, or until the employee secures a new job.

Q3. Is outplacement only for executives?

No, while often used for senior roles, outplacement services can be offered to employees at all levels.

Q4. How much do outplacement services cost?

Outplacement costs typically range from $1,000 to $10,000+ per employee, depending on factors like seniority, service level, program duration, and whether support is one-on-one or group-based.

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