Laissez-faire seems to get a bad rap most of the time. In almost every discussion about leadership styles, laissez-faire is characterized as a weak way of leading a team. Author Dr. Kimberly Alyn, in her examination of Transformational Leadership in the Fire Service, described the laissez-faire leader as someone "who waits to intervene until things are in a crisis situation". This seems an unfair characterization.
Effective leadership is about timing. Every leadership style has a time when it is the appropriate style for the moment. By the same token, there are times when a certain style may be inappropriate. The discerning leader observes the followers and uses the right style, in the right place, and at the right time.
My own thought is that people read Laissez and conflate it with "lazy" when in reality what it means is that leaders consciously recognize when things need no interference from them and choose to let events take their course. A proactive leader is constantly scanning the activities of their followers and deciding what style is needed at any given moment. It follows that there will be times when "hands-off" is the most appropriate approach. Contrary to Alyn's assertion, sometimes it is appropriate to let events come to a crisis point as a way of learning. For example, in military training exercises, it is common to let events unfold to the breaking point as a way of training soldiers to push their limits or as a way of learning new ways to fight. Put in this context, laissez-faire as a leadership style makes a lot of sense.
Having said that, it is never appropriate to be so "hands-off" that someone is hurt or the business/organization is irreparably damaged.