Better not do this.
How to not do layoffs.
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Happy Thursday!
It's been three weeks without articles. Life got in the way, but it feels good to be back on track. My goal is still to write something every week, and not doing that has thrown me off track. I usually start each workday by writing for 30-45 minutes to clear my head and prepare for the day.
So, once again, it's good to be back.
Today it's about better.com and their (epic) failures and what we can learn from them (or hopefully already know, tbh).
In December, just before the holidays, Vishal Garg, CEO of digital mortgage lender better.com, hosted a Zoom call with 900 employees.
His message? That the employees who participated in the call "are part of the unfortunate group that is being laid off."
He explained the details and said HR would contact those affected.
He also pointed out that it was hard for him and that he cried the last time he did this, but he hoped he was stronger this time.
Videos of the conference call have been circulating on the Internet ever since, so there's a good chance you have already seen it. And it generated an insane amount of press, which also led to an apology from Vishal Garg.
"I failed to give due respect and appreciation to the individuals involved and their contributions to Better.”
So you hope he learned something, right?
Better faces another round of layoffs three months later, reportedly affecting more than 3,000 employees.
Given what happened last time, you assume everything is going by the book, right?
If you guessed "no" in the above question, you guessed right.
Multiple sources report that employees learned that they were being laid off through their paycheck, which leaked the night before they were told the news.
The lessons learned here may be self-evident, but let us summarise them anyway because it's probably good to outline them since this is obviously still happening in the world of work and will likely continue to happen.
How to not do it.
For heaven's sake, don’t do layoffs out of the blue on a Zoom call where you simply say that "those of you on this call are dismissed" and leave it at that.
Don’t get me wrong here; sometimes you have to lay people off. Whether it's because of a change in the business environment or someone not meeting expectations, I have no objection to companies having to terminate people's employment.
But when you do, do it the right way.
And what is the right way? There's no magic formula for this, of course, but a prime example that also has to do with business impact comes from Airbnb.
Airbnb co-founder and CEO Brian Chesky sent the following memo to Airbnb employees to say that they were struggling because of the COVID-19 pandemic and therefore had to lay off employees.
When you’ve asked me about layoffs, I’ve said that nothing is off the table. Today, I must confirm that we are reducing the size of the Airbnb workforce. For a company like us whose mission is centered around belonging, this is incredibly difficult to confront, and it will be even harder for those who have to leave Airbnb. I am going to share as many details as I can on how I arrived at this decision, what we are doing for those leaving, and what will happen next.
Take the time to read the whole letter; it is worth it.
Why has this not caused an outcry as it has with better.com?
First and foremost, in the case of Airbnb, from the note, we can tell that this is not the first time they talk about layoffs. It seems that people are already mentally prepared for something like this to come.
In the case of better.com, it seems to come out of the blue.
Airbnb's explanation is transparent and explains why Airbnb is letting people go. They show their reasoning behind and the process leading up to the decision.
Better.com lists several reasons why people are being let go. It’s everything from the pandemic to employee performance. This is confusing, and as far as we know, no further explanation is given to the affected employees.
Better.com goes on to say, "You will receive an email with the details," and that's about it. Airbnb points out that everyone should have a 1:1 conversation with their supervisor about their departure, as far as legally possible.
This is perhaps one of the things that stands out to me the most. Even though 1:1s takes a lot of time, it’s simply the right thing to do.
Remember the scale of the layoffs, 900 from better.com and 1900 from Airbnb. The latter still emphasized having 1:1s. Because, as said, it’s the right thing to do.
An interesting fact is that the Airbnb firing happened a year and a half *before* the better.com debacle. Better.com could have (should have?) taken inspiration from Airbnb, but did they? No.
Was this the last time someone fired people in a town-hall video-meeting format?
I am sure it was not.
As we move our offices online, this will likely be the future we work in. But that does not mean we should be sloppy and do mass layoffs on a Zoom call.
Quite the opposite.
If we have to make redundancies in our remote teams, it's even more important to do so deliberately and thoughtfully. And Airbnb can serve as a good inspiration for how to make layoffs in a big way, but still in a mindful and compassionate manner.
And yes, it's always one thing to judge these cases from the sidelines.
There are always nuances to the case, and Airbnb may not have done everything flawlessly, either, and they have had to deal with the backlash, but not to the extent that better.com has. (Which makes perfect sense in my opinion...).