Cut people, not work

Lay off your workers but don't reduce the amount of work that still has to be done by the people left behind.

How to be a great boss: Have the courage to cut work, not just people.

The only legitimate reason to lay off workers is because you have determined that the work they are doing should not or cannot be done anymore. This could be because you need to cut costs to reach a specific budget figure or because you've evaluated the work that's being done by your department and realized that certain areas of work are not contributing to your bottom line either directly or indirectly. Don't just cut staff and expect the same amount of work to get done.

Be very explicit in your internal communications. Say that you have identified x, y and z chunks of work that your department will no longer be doing, and explain why. Don't dump a fresh load of work on the employees who remain. This is also a good opportunity to set priorities for the categories of work that your people are doing: "If you do nothing else, make sure that 'a' and 'b' always get done. After that, your next priorities are 'c' and 'd' " and so forth. Remember, focusing on core competencies is a good thing.

If, instead, you want to lay people off because you believe that your workers are not productive enough and therefore need to have more work piled on them, that's a completely different problem. Address that specifically with the employees who should be doing more work. Don't address it by reducing your staff.

Nobody likes to hear about layoffs. They'll like it even less if you pussyfoot around and don't explain why it's happening.