Technically speaking, companies are supposed to use layoffs when they need to save money. Maybe there’s an economic recession, so the company’s revenue just isn’t where it was the year before. The company has to cut 10% of its staff just so that it can stay afloat and avoid filing bankruptcy.
As such, workers are generally blameless in these layoffs. The company isn’t saying that they’ve done anything wrong and isn’t even firing them. The positions just have to be eliminated as a cost-cutting measure.
Is this really what happens?
The problem, though, is that it appears many companies actually use layoffs for a much different purpose. For example, in one study, 59% of those polled said they were trying to “avoid wrongful termination claims.”
Often, what can expose this is if there are any patterns or notable trends regarding who gets laid off. The layoffs shouldn’t be discriminatory in nature, meaning they shouldn’t unfairly target people based on their race, religion, gender, age and the like.
But if the layoffs happen and every worker over 50 years old gets fired, for example, those layoffs may actually have been set up to prevent wrongful termination or discrimination claims. The owner of the company knows that they can’t just fire everyone over a certain age, since they’re not allowed to use age when making hiring and firing decisions. But if they call it a layoff, they may assume that no one will notice.
Of course, employees do notice, and those who feel they have faced discrimination need to know what legal options they have.