Employees at the Utah wellness company doTERRA had heard murmurs about financial hardship, decreased revenues and lower sales.
Some had a general sense, or a least a vague awareness, that doTERRA’s ship might have veered off course. But they did not suspect it was sinking.
The company’s “rightsizing” earlier this month, in which it laid off roughly 290 employees, or 7% of its U.S. workforce, came as a “total shock,” said one employee who asked to remain anonymous.
“I was not prepared to hear the news like I did,” another employee said. “It really did throw me off guard.”
Laid-off employees signed separation agreements that included confidentiality and non-disparagement clauses clauses — a practice the National Labor Relations Board banned last year but still persists. Such clauses have historically prevented employees from speaking out after being laid off and disclosing any details about workplace conditions.
Several employees who spoke to The Tribune said they feared losing severance and asked for anonymity. DoTERRA did not comment on whether their separation agreements complied with NLRB rules.
Utah’s labor market was one of the “best in the nation” last month, Utah Department of Workforce Services Chief Economist Ben Crabb said in an employment report. The unemployment rate was lower than the country’s at-large, and its job growth was slightly larger. But Utah’s workforce has weathered a steady wave of layoffs in the past year as certain industries — such as finance, tech and hospitality — have downsized or contracted.
There’s no perfect way to predict a layoff, or respond to it — but there are better ways, said Beca Mark, founder of Utah human resources firm Megastar HR.
“It’s always been my believe that resiliency in a career — how you take [setbacks and layoffs] — sets you up for success or failure,” Mark said. Layoffs are tough, Mark said, but there are benefits to seeing them as opportunities rather than failures.
The anatomy of a layoff
DoTERRA announced its layoffs first in a company-wide email, telling employees to go home for the day and await news of their fate. Then, individual emails were sent to employees who were cut.
Shortly the second emails were sent — or in some cases, right before, according to one employee who shared their experience with The Tribune — employees who had been fired lost access to their work emails and work chats.
“We were extremely surprised and very scared,” the employee said. “In an hour and a half, I lost access to my email, [Microsoft] Teams, and work computer – at the same time I got the email that I had been laid off, which meant I couldn’t say goodbye or transfer relevant personnel files that could help me in my hunt for a new job.”
Individual email announcements were sent to personal email addresses; in them, a doTERRA HR representative outlined severance offers, benefits and a timeline for employees to collect their belongings from the office and return any work equipment. Affected employees could schedule a meeting with HR to “talk through any questions or concerns,” according to one email shared with The Tribune.
Employees who spoke to The Tribune said they did not have time to talk to their direct supervisors or fellow teammates about the layoffs; they were told they had to coordinate with HR to return their things and collect belongings, and could only do so outside office hours.
Some of what doTERRA’s employees experienced is, for better or worse, standard practice, Mark said. In her HR career, Mark has survived layoffs, has helped companies plan and execute layoffs, and has had to lay people off in her own company. It’s the “worst seat to be in, ever,” she said. “It’s not fun from any direction.”
But doTERRA’s strategy was pretty by-the-book, according to Mark’s standards: It outlined the severance policy, offered career transition services (doTERRA former employees were offered two free sessions with a career coach, according to the email), and it let employees schedule times to pack their desks so they didn’t have to do a “walk of shame” during work hours. Other layoffs at big Utah companies, such as Qualtrics and Pluralsight, have followed similar scripts.
Mark said it’s best, however, to notify employees personally and face-to-face — or, as close to face-to-face as possible in the age of remote work. Ideally, an email should accompany and supplement a meeting, not replace it, Mark said. But, she added, such logistics are not always feasible, especially in mass layoffs.
There’s also something to be said for the timing of a layoff, Mark said. Employees at the real estate company Homie were notified in April that they were being let go, or possibly reclassified as contractors, on a Tuesday afternoon. doTERRA’s announcement happened on a Friday.
Fridays are popular, Mark said, because it gives people the weekend to cool off and process. But Mark said she prefers to break the news on an earlier weekday, “so [employees] can get up the next day and actually go look for a job.”
Warning signs
A company is unlikely to show its hand ahead of a layoff, but there might be signs, Mark said. The big ones:
• A new or increased emphasis on performance reviews.
• Sudden or increased town halls in which executives talk about profits.
• Generally, any increased emphasis on profitability. Private equity buy-outs, Mark said, can forebode staff reductions.
So what can employees do if they suspect turbulence? Nothing is a guarantee, but Mark said it can help to double down on performance — because companies are less likely to fire their highest performers.
Even in stable times, Mark said she recommends being “pretty vigilant” about keeping resumés up-to-date. Employees should also consistently cultivate their professional network and “personal brand” online and in their community, Mark said. Connect with people on LinkedIn; engage with other players in your field.
“Befriend recruiters,” Mark said. And keep tabs on what jobs are out there.
You got the ax. Now what?
It’s not uncommon to see freshly laid-off employees share news of their fate on social media. Dozens of doTERRA employees took to LinkedIn in the days following the cuts, announcing that they had been let go and were looking for work.
“While it’s disheartening to leave behind a job I cherished, I’m eager to explore new avenues for personal and professional growth!” one former employee posted.
It is an exercise in catharsis and solidarity — but it can also be a strategic move, Mark said, if done correctly.
“If you’re negative at all, you’re setting yourself up for failure,” Mark said. Employees who can put a positive spin on a difficult situation almost “always land in a better place.”
The most important thing in the immediate aftermath, Mark said, is to read the fine print.
The NLRB ruled last year that nondisparagement and confidentially clauses in separation agreements— like the ones doTERRA employees signed — violate the National Labor Relations Act. They are not, technically, legal or enforceable, according to the NLRB. There are exceptions, according to the NLRB, for narrow confidentiality clauses meant to protect proprietary information or nondisparagement clauses that account for defamation.
But it falls on employees to read the agreements and interpret their legality — which requires knowledge and skills not everyone has. You don’t have to sign an agreement without discussing it first, Mark said. And there may even be room to negotiate.
“The company really wants you to sign the agreement,” Mark said.
Separation agreements should spell out severance terms and any benefit extension offers. Read them closely, Mark said, and take advantage of any extra incentives a company offers, such as COBRA benefits or career transition services.
Shannon Sollitt is a Report for America corps member covering business accountability and sustainability for The Salt Lake Tribune. Your donation to match our RFA grant helps keep her writing stories like this one; please consider making a tax-deductible gift of any amount today by clicking here.
