The Most Challenging Times: Navigating Layoffs 

Watch the YouTube version of this episode HERE

Are you a firm owner who is struggling with layoffs? In this episode, Jim and Tyson discuss the difficult layoffs as well as the tough reality of letting people go due to a downturn in business.

Jim and Tyson delve into the reasons why layoffs occur. Jim identifies the issue with spreading yourself too thin, in which too many responsibilities are given to too many people, when it doesn't have to be that way. 

Consolidating where necessary is a good way to keep responsibilities simple and not lead to paying for more employees when less are needed. Layoffs can also occur when a firm owner is thinking too far into the future instead of thinking about what is needed in the moment. For example, many firms experience fast growth. With fast growth comes more clients and therefore more lawyers or support staff. But, firms also experience downturns in work and if this is not documented and that fluctuation is not talked about, it can lead to issues with paying for staff.

Listen in to learn more!

Jim's Hack: We aren’t creating enough content! Create more content for marketing your firm. People are not going to get tired of you! Do more! 

Tyson's Tip: You can work harder and it’s not going to hurt you. 

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Episode Highlights:

• 7:04 Analyzing the factors contributing to the need for layoffs
• 18:42 Discussing the consideration of shifting employees to different roles
• 19:10 Discussion on the considerations and movements within the firm

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Transcripts: The Most Challenging Times: Navigating Layoffs 

Jim (00:01.342)
Welcome back to the Maximum Lawyer Podcast. I'm Jim Hacking.

Tyson (00:05.511)
And I'm Tyson Mutrix. What's up, Jimbo?

Jim (00:08.65)
Well, Tyson, if we were recording this episode yesterday, I would have called it, I'm mad or Jim's mad, but we're flipping it like a pancake. Like our buddy, Billy Mansky said at max lock con 2019. So here we are. We're turning it around. We're going for broke. We are all in on optimism. And I told my team today that I don't want to hear one complaint, one gripe.

For the next six weeks, we're going through some major transitions at old hacking immigration law, and I want everybody rowing in the same direction. I got no time for negativity, and so I'm just not even listening to it.

Tyson (00:46.027)
Hey, so you, have you seen the, hold on. Alexa turned on whenever I said, hey.

Jim (00:54.566)
That horror.

Tyson (00:59.767)
Then that thing turns on. Have you seen the show that is on Max, which was on HBO, that it's called Showtime, I think. It's about the Lakers. Have you seen that?

Jim (01:01.774)
Thank you.

Jim (01:14.03)
No, no, I would have, I was getting ready to start it and then they canceled it. So then I thought I wouldn't watch it.

Tyson (01:20.007)
It's worth a watch. They definitely take liberties with it, but there is an episode near the end where Pat Riley is, I mean, he's pissed. He's angry because the team has gotten comfortable and they're champions. All of them are champions, but they've all gotten comfortable. They've all just been bickering at each other. They'll all snipe, so they'll come up and say, hey, Riles.

you know, tell Kareem to do this. Hey Riles, you know, tell Irvin to do this. And he just, he got to this like breaking point where he called them all out in the same room. He says, you know, magic, you're saying this about such and such and Kareem, you're saying you, uh, you retired two months ago. You know, like it's like, it like really called him out and, and said, from this moment forward, we're stopping all that. You know, we, we're, we're going to get all this out right now and we're going to move forward.

There's none of this fighting each other. There's none of this bickering about each other. We're all going to get on the same page and we're going to move forward. And then it's a really cool speech. Right. And so it kind of reminds me of what you're just saying where, and maybe people aren't bickering, maybe people aren't fighting each other, but sometimes you do have to just say, you know what? We're going to do this. We're stopping this crap. We're not complaining. We're not going to do this.

Like you said, we're going to flip it like a pancake and we're going to move forward and we're going to progress. We're going to, as Jason would say, that relentless solution focus is what you're going to focus on. So yeah, so I guess what's going on with you that you were so angry yesterday that you had to change your mindset.

Jim (03:10.558)
Well, before I get to that, you remind me of a story from law school. So Amani and I both wrote onto law journals. So we didn't have the grades to like grade onto law journals. So in our class, I think they take 30 new members of law journal each year, 10 grade on by their GPA and the other 20 go through this writing competition. Well, at the end of that, that second year of law school, then everybody applied to be the editor or the managing editor of the law journal. I ended up.

Um, there were nine other people applying for the manager for the editor in chief position. And apparently they all complained about each other. Um, so I was in there and I talking about leadership and optimism and getting the thing done and, um, our friends, Pete Salsic and Amy Gunn, they were the outgoing board. So they selected me to be the editor in chief and my money to be the managing editor. Money didn't apply to be the editor in chief. Um, she always likes me to remind people. Um, but in any event, in any event, about six weeks into our gig,

Tyson (04:03.166)
I'm sorry.

Jim (04:08.11)
Um, the, the nine people who did not get editor in chief, they were all made just editors, which means they supervise the second years on editing these law journal articles and all they did was complain and all they did was gripe and moan and, and they kept telling me what they weren't going to do. So we had, I haven't seen, um, winning time yet, but we had a meeting just like that where I said, listen, I'm sick of all the bickering, I'm sick of all the bitching.

I did, and I'm sick of hearing what you're not going to do. What I, what I want to focus on today is what are you going to do? So I think that is, I think clearing the deck sometimes when there is that spirit of negativity is important. Um, as far as what's going on with us. So for the first time in the 15 years that we've had old hacking immigration law, well, I guess not technically, but, but certainly on this scale, we had layoffs this week. So we laid off four people and. Three weeks ago, we laid off two people. So in the last couple of weeks, we've laid off six people.

It was not a, they were not fun conversations to have. They, the, several of them weren't, did not see it coming. I think some of them did, but, um, we simply aren't signing up as many cases in September and October as we usually do. And there's just not enough work for everybody. So, um, I went back and listened to a podcast that I recorded with my dad before he passed away, uh, for father's day, about three years ago. And, and in there, he said, Jimmy, you just got to.

you got to cut until you're profitable again. So we're going to have to make do with less. And we're going to have to do it at a time where we are transitioning into a whole new set of software for the firm. So there's an, and our office is under construction. Our phones are under construction. Our software is under construction. There's all this stuff, none of it fatal, none of it dire.

None of it unanticipated, but there's just a whole lot of stuff going on right now. And I realized that I, as the leader, have to be better, have to be more positive, have to flip it like a pancake, like Bill said in his presentation, like Jason says about focusing on solutions. And I just, I frankly have so much to do. I don't have any time, even if I was inclined to listen to complaining, or even if I was inclined to complain about our problems, I don't have time for that. I simply don't.

Tyson (06:27.099)
Yeah. Do you remember the episode number on that? I want to look that up.

Jim (06:31.658)
Yeah, it's, I don't know the episode number, but Becca shared it with me. It's in our chat for, um, max law, but it's, if you just type in father's day, maximum lawyer, you'll get it.

Tyson (06:41.675)
Very cool. Yeah. I want to check that out. So you had texted me, we were texting back and forth a few weeks ago. So I had an idea that this was coming and you'd said, you know, we just kind of got too fat. And so why do you think, let's dissect this a little bit. Why do you think, because I honestly think that we're in that direction where we're building, we're in growth mode, growth mode, growth mode, growth mode.

And I think that there is this tendency to just keep adding when you don't really need to add. But I'm wondering what, if you've identified any trends as to how it happened where you got heavy.

Jim (07:24.322)
Um, I think we were sharing out lots of responsibilities to lots of different people and we probably shared too many responsibilities to too many people. And now we have to consolidate those responsibilities to less people, not just because of the financial. I mean, um, Monnie and I've been saying to each other.

all week that the scrutiny and the oversight that we're like looking at every department, we're looking at every person that works there, we're seeing what's working, what's not working in every department. And I think that sometimes when things are going well, you lose that edge, you lose the old eye of the tiger, right? And you just, by definition, because things are going well, you don't have to have that same level of scrutiny. But we were saying like, man,

when we turn this around and we're confident that we will, we still need to maintain this level of scrutiny and to have these same expectations of the team members that we have.

Tyson (08:16.412)
Your thing gave me the thumbs up whenever you did it. Mine still doesn't do it. It just threw me off. Yeah. What's interesting is something we're noticing when it comes to our firm is we've shifted away. I mean, we do have VA's. We still have several VA's, but we've shifted away from that. We've definitely shifted towards hiring more state-side A players, which is…

it's more expensive, especially whenever you're comparing it to B and C players that are virtual. You're talking about a substantial increase in salaries. And so I think that is another thing that people, if they do shift that, it's one of the benefits of hiring remote employees too that are overseas is that you can get them for a significant reduction. So that's something you get to consider as well. But how much do you think the-

the getting heavy just can… It happened because you had your eye on the wrong things, where you're focusing too much on the future and not necessarily internally enough.

Jim (09:26.914)
Great, great question and something I was going to bring up. So I think that there's another aspect to this. Jim likes to talk about how many employees he has. Jim likes to talk about fast growth. Jim likes to talk like he knows everything and doesn't have. Sure.

Tyson (09:38.615)
Can I say something with that really quick? Cause I want you to finish your thought. I get caught up in that too. Like I, and I, I've had to stop myself cause I hear people say, well, I have 50 employees. I have a hundred employees. I was like, oh, I want to, I gotta have that. I gotta have that. And so I get that, I get that too. I get the urge. I completely do. But continue with that.

Jim (09:57.73)
So let me just say as an aside, I remember when you and I finished recording maximum law minimum time, which focuses on the three stages of law firm growth. And we sort of looked around and said, well, we're sort of in stage four, maybe stage five, whatever, it doesn't really matter. But I remember us sort of saying, well, you know, like, do we have a message for those people? And the funny thing is, is that you and I have now experienced a lot of the things

in stage four, like I've experienced real fast growth and now I'm experiencing contraction that's necessary. Right. So, you know, Gary V told us to document the journey long ago and my confessional in today's podcast is sort of part of that of being honest and open with our listeners about, you know, the good, the bad and the ugly. So, uh, I do think there's a big ego part of it, right. And, and an ego, I would say ego plus

futuristic thinking plus eternal optimism, which is a problem of mine. And then not focusing on the right things in the here and now. I'm always drawn to the shiny object. I'm often drawn to the things that are coming down the pike more than the day to day. And so I think that we weren't looking at the right things. And Namanee was sounding the alarm much sooner than I was.

ready to listen to it. And I think that I should have done a better job listening to her. I mean, I view it as a personal failure that I had to lay these people off. And I'll tell you this. One thing is I'm going to be a whole lot slower to hire people now, cause I don't want to go through that again. Like I want to make damn sure that the people we have are at capacity before we get to a stage where, where we don't, or where we have people that we don't need anymore.

Tyson (11:46.435)
Were these in-seat employees or were they remote?

Jim (11:50.398)
Um, they were, let's see, it was a U S marketing team member. It was an, uh, it was two U S marketing team members. It was a paralegal in America and a paralegal overseas.

Tyson (12:04.951)
So are you, by like the third or fourth one, do they have an idea that, hey, this is what's coming?

Jim (12:10.626)
Well, it was all virtual and you know, we just, we, um, Amani, Adele and I sat up in the conference room and we had a Google meet open and we would just call one in at a time so nobody knew what the other one was doing. And then now we've gone and talked to each department about what happened. And we thought about doing, and my sister, Carrie, who works for Big Farmen has been through mass layoffs before suggested that we have an all hands on deck, but there were a lot of people who weren't affected by it. So we didn't think necessarily that we needed to talk to everybody. So instead we just did a department by department.

Tyson (12:41.875)
Anything that you feel like in this process that you've screwed up?

Jim (12:47.954)
Oh, lots. Yeah. You know, I'm always learning. So I mean, for sure. So, um,

Tyson (12:52.095)
And by the way, that was a bad question. I'm talking specific to the actual layoffs. Like when it comes to that, anything in that process that you think you could have done a better job of.

Jim (12:55.094)
That's fine.

Jim (13:03.062)
Well, I will say, I think it's always dangerous to lay off people from marketing because they know, they know what's important to you and they know what they know where to hit you and hurt you. So I would say the shoe hasn't dropped yet. Um, I think the particular person that we let go, one of the people isn't going to be, isn't happy about it. So I don't know what'll happen yet. Like what might show up on glass door or LinkedIn or indeed or whatever. Um, so

Tyson (13:26.807)
I didn't think about that. You know, that's, that's one of those things you got to see, you know, take into consideration these days.

Jim (13:32.274)
Mm-hmm. You know, as an aside, I was saying to Amani last night, we went on our walk and I was saying, dude, we need to set up the reverse of Glassdoor where we get to leave reviews on employee on past employees anonymously like they do to us.

Tyson (13:45.923)
I shit you not, I had that same thought this morning because I think it's unfair. I had that exact same thought this morning. I was in the sauna after the gym and I was like, I saw someone bitching about an employer thing. I'm like, this is just not right. I just, legally, I don't even think we can bitch about it, but it's like, yeah, I had the same thought about that. It's not right.

Jim (13:48.222)
I'm sorry.

Jim (14:11.826)
So lots of lessons, lots of lessons. Um, I'll say a couple of things. Number one is you got to keep a level head and going for walks with Amani has been really helpful talking to Adela often. I mean, we're in a period now where we really need to be over-communicating with everybody. Um, and as we're trying to pull out of this slump of signing up cases, I mean, I've got that intake team rocking and rolling like we haven't in a really long time. So I'm confident we're going to turn it around and the energy is real good in the departments that I run.

Um, but you do have to over communicate. You do have to try to be as transparent as possible. Um, it's, you know, for any employee, when people get laid off, I think that's a scary time. So you got to do what you can to reassure people, let them know that, you know, you remain committed to your, your goals and your, your dreams and that the need for immigrant immigrants to have lawyers that are smart and helpful is still there. So it's just a matter of recalibrating and then, and then.

you know, stabilizing people because a lot of people in our firm don't like change. And so you got to take that into account both when you're laying people off and when you're also moving into new kinds of software. So there's just, there's a lot going on right now, brother.

Tyson (15:22.623)
Yeah, so I want to look up something really quick. So Jack Welch had this thing, it's that 2070-10 rule where, and it's often misinterpreted by the way, it's not exactly what I'm about to describe. So for those of you that are familiar with it, don't beat me up too much. But essentially, he would cut the bottom 10% of employees every year. Those are the low performers. And by the way, that's not exactly what it is, but in a nutshell, it's-

kind of what it is. So given that sort of framework, and like the top 20%, like is the 80-20 rule, but would you consider, since what just happened, would you consider doing something like that going forward?

Jim (16:11.862)
Well, I don't want to characterize the people that we left as the bottom 10% because I don't want to talk about people's employment with us and that kind of thing, but I do think, right. No, that's okay. I, I understand the question and, and I've thought about that. I will say that when, when push comes to shove, you're asking yourself.

Tyson (16:18.739)
And I'm not saying they are. Okay, so that's on me. That's not on you.

Jim (16:31.626)
You know, who are the have to haves and who are the can, can live without or nice to haves, right? So I think it's just that, that it becomes sort of that simple. And sometimes you have to make tough decisions. Sometimes you have to make cuts where you might not necessarily choose to. So I think, I think. One of the values of having a firm retreat and an annual check in with everybody is sort of like when people go to the mastermind, it's a clarifying time.

You know, we always say at the mastermind, somebody's about to get hired and somebody's about to get fired. So when you have these moments set out in your calendar, where you're getting ready for your next year and you're saying to yourself, do I really want to go to battle with them for the next year with these people or without? And I think, I, I don't think you want to do anything as draconian as Jack Welch. Um, but I do think that it does. I mean, you, you did it through the top grading system. I do think there's a time and place for regular.

assessment. I mean, here's the way I think about it. The NFL spends a shitload of money every year on scouts, the NFL scouting combine. You know, they have a roster of 53, which is interestingly right around the number that we had when we went through this, right? And so every year they take a look at these, uh, high blue chip prospects. They, they go looking around for

Jim (17:56.486)
And they probably have a 30 or 40% turnover every year, right? And they're just always trying to improve. So I don't think, I don't think that the practice of law necessarily needs to be like that, but I do think you have to be open to the possibility that there might be better options for you out there. And I, and I also think, um, along those lines, I understand why you're moving to more A players and away from VA's, but I do think that there's some stuff that we just need to say.

This is a set of tasks. I need someone that can do this task that doesn't necessarily translate into a 40 hour a week W2 employee.

Tyson (18:32.483)
I totally agree with that. And that's where we still have those VAs and that's where we're replacing those with AI and automations too. But yeah, definitely agree with that. When it comes to the employees, I want to talk about the decision making a little bit. So let's say I'm going to use departments A, B, and C. So department A has three A players.

Tyson (19:04.616)
And department, not apartment, department, C has maybe an A player and a B and C.

Jim (19:06.55)
department.

Tyson (19:17.495)
How much did you think about, okay, let me just shift one of the three A players over into from, you know, department A over to department C and then just clear the house when it comes to the third department, department C. And did you consider just moving people roles because they are A players or was it no, that department's too heavy. We just have got to get rid of that person. So-

How much did you, okay, I kind of overcomplicate this question. How much did you consider just shifting people into different roles because of who they were and that you knew that they're a player versus just getting rid of them because they were just, that department was too heavy.

Jim (20:01.666)
How many people came to your wedding with you and Amy?

Tyson (20:06.211)
210, I think.

Jim (20:07.938)
Do you remember when you sat down and were trying to figure out who to sit at which table? I remember how sometimes there's the Randy randoms, but then also, you know, there's people you wanted to be together. So there was a little bit element of that as we were looking at what you call department A, department B and department C. And actually it's funny that you frame it that way because in operations we have three pods. So, um, there was definitely, um, interestingly, there was a fifth person who was sort of.

Tyson (20:12.869)
Yes.

Jim (20:37.746)
uh on the block and we decided to keep that person and once we made that decision then we started see because here's what you have to remember Tyson somebody's running department a somebody's running department b and somebody's running department c you don't want to handicap them and cut their legs out from under them so you have to make sure they're all properly staffed so there was some movement of a's a players to another department to balance things out so um and it was funny watching some of the decision makers

who would be affected by who ends up in their little departments talking. I mean, we literally went to each department head throughout the firm and said, tell us about your expenses you can cut and the people that you can cut. And so there's, there's definitely, you have to spend time thinking about how's, how's it going to work after this happens.

Tyson (21:28.223)
Yeah, what's the new makeup of the team look like? Yeah, that's gotta be a really big consideration. Yeah, totally. How much of, when it came to the decisions, were these majority of them support personnel, meaning they were not making the widgets, they weren't preparing the immigration documentation and all that versus…

Jim (21:34.87)
The biggest, I think, the biggest.

Tyson (21:56.115)
So yeah, like the people that would do that, like the attorneys, you have attorneys that are getting that stuff done, you got paralegals that are getting that stuff done versus someone that might be in operations that's admin. So were you, yeah, how was that? How was the mix up?

Jim (22:10.274)
So it was, it was, it was one marketing person, three people from intake because intake was too big. Cause intake was built for a higher number of leads that we weren't getting. It was that marketing person and then it was two, two paralegals. So it was mostly like I said, and the truth of the matter is that as much as we've tried to do marketing that doesn't involve Jim's YouTube channel, Jim's Tik TOK channel,

and repeat business, you know, we're doing all the other stuff, you know, Instagram reels and all this other stuff that, that is being done by the marketing team. It wasn't what was moving the needle. What's moving the needle marketing wise, unfortunately is still the same old stuff that Jim does. That's always worked. So until we figure that out, we probably don't need as big a marketing team. And so that that's why that became pretty obvious.

Tyson (23:04.743)
Is there, and we're going to have to wrap up in a moment, but is there a, do you think that maybe there's an optimal number for your firm that you just need to be totally, and it's not that you don't want to grow more, but is there maybe an optimal number that can be at your firm that will still allow you to grow when it comes to handling more cases and everything, but you just don't need to exceed that number? Your face is, I can't wait to hear what you're going to say.

Jim (23:32.734)
Have you been, have you been following me and Imani around? Because as you might imagine, she's pressing her advantage at this time of turmoil to hit me over the head with, see, I told you, see, I told you, we don't need to grow. We're too big. We're too big. We're not getting any bigger. No, we can't get any bigger. The reason we're having these problems is because we've gotten bigger and that's the eternal question. That's the, that's the next, that's the next, uh, science experiment, which is, is that true?

Is it true that the reason we're having these problems is because we grew or is it because we didn't have proper supervision, proper analytics and proper supervision?

Tyson (24:11.731)
Interesting. Well, Tuba continued. I think that's a nice… Yes, I like… All right. Well, let's wrap things up. I enjoy this podcast. This was a good one. It's always fun chit chatting with you, but let's wrap things up. And I'm just going to start with the Google review. I'm just going to say it. We're talking about starting with flip it like a pancake, but we got to some really

Jim (24:14.21)
There's a cliffhanger for you, huh?

Jim (24:25.77)
Yep, this is a good one.

Tyson (24:40.791)
please give us a review if you don't mind. We would really appreciate it. It helps spread the love. I don't think many people realize the importance of getting those Google reviews so we can help spread the love to other attorneys because they really do need some help. So help us do that. And then, I'm not going to talk about the Guild. You'll have heard about the Guild at this point. Just join us in the Facebook group. If you want to join us in the big Facebook group, just search Maximum Lawyer and we'll go from there. But Jimmy, what is your hack of the week?

Jim (25:15.307)
We aren't creating enough content. As much content as we're creating, it's not enough. So you gotta be more creative, you gotta be more fun, you gotta pull out that phone and just create basic content. You gotta, I typed a LinkedIn post every day this week. It took me literally under 10 minutes. So you just gotta get better and more consistent. And if you're operating under the mis-assumption that

people are gonna get tired of you or they're gonna see too much of your stuff, that is never going to happen. There's an unending stream of content, which I suppose by this exhortation I'm increasing, but at the end of the day, you cannot create enough content.

Tyson (25:57.015)
I think that that's right. And I beat myself up quite a bit about not producing enough of it, but you are 100% right. You got to put it on your counter, got to get it done. So I'm sure some people aren't going to like to hear me say this, but here's my tip of the week. You can work harder and it's not going to hurt you. I can just tell you that. I've put in more hours this week than I was 10 years ago.

And guess what? I fucking love it. And it doesn't bother me one bit. And so when you tell yourself, oh, I'm tired, I'll get to that tomorrow. I think you're doing yourself a disservice. I think you're lying to yourself. You can work harder. You can. And I'm not saying you shouldn't take time to spend time with your family and get relaxation time and all that. I do all those things too. But when the work needs to get done, the work needs to get done. Roll your sleeves up and just do it.

So just stop lying to yourself if you're saying you're too tired. Just get it done. There'll be a time to rest. But sometimes you just got to roll up your sleeves and go do the work. All right, Jimbo. Love it. Good talking to you. And I guess I'll see you at two o'clock. So I'll see you later.

Jim (27:10.07)
Yep, good stuff.

Later, homie.