This is the hardest thing I have ever done. The market changed - I thought we would make more money, now I think we will make less money. Therefore we have discovered that we don't need all of you.
If you aren't needed, here is some money. I hope this is enough money that the internet isn't too mad at me.
Remaining Floofernistas, please be kind to the ex-Floofernistas, and help them.
In the chimpanzee world, this would be handled differently.
In chimp world, when alpha chimp causes chaos that brings down the community, a group of beta chimps will tear apart alpha chimp limb-by-limb, then they elect a new alpha from the group of beta subversives. This also how the organized crime works - leaders get a lot of benefits, but they also get the downside accountability when they fuck up ("skin in the game").
In modern corporate america, this relationship is broken - when CEO fucks up, he just fires a bunch of people, and then collects the bonus at the end of year in the for of stock performance (layoffs are to maintain stock performance). This is why finds the half-hearted apologies to be hollow and unpalatable.
Let us bring back accountability. Apes. Together. Strong.
If you think this is a sign that plaid is anywhere near their last valuation of $13bn, then I have news for you.
The real problem is inequality. Zach is facing consequences, but the drop from $1bn to $100mn (a 10x decline in wealth) is so much less impactful than $250k to $25k (illustrative of what an employee is more likely facing).
The problem is in real life your analogy would actually map the alphas to the ceos and the betas to the shareholders/stakeholders. The employees are nowhere in this.
Edit: as the other post said, they would be the sticks, shovels and other assorted tools…
What if this is not a mistake? If you have 5 people and 10 projects, you hire 5 more to meet the need. If 4 projects go away, you fire 4 people as some would have nothing to do.
Where is the mistake?
I’m not saying it is always like this and the scenarios above is simplified to illustrate a point. However, it would be silly to assume all companies always grow in headcount, and any downsizing is the CEO somehow messing up.
Overhiring right before a recession/tightening of the money supply is not exactly 'bringing chaos to the community'. With the 20/20 benefit of hindsight, its a mistake, but its not a malicious mistake.
Also, I'll remind you that the Fed is actively trying to increase unemployment. Do you think that's going to happen without people... Losing their jobs?
You have the analogy wrong though. The other apes in the corporate world are the shareholders, not the employees. The employees are the sticks the chimps use to dig up termites.
I think the chimpanzee analogy works pretty well in the corporate world too. If the CEO fucks up, then board fires the CEO. They usually don't dismember the CEO, but I don't think it's a pleasant process for anybody. However, everyone involved in this process is compensated very well, so there's no need to feel sorry about it.
> Write a letter from the CEO of a company called Floof where employees are called Floofernistas about the lay off of 5000 employees.
<<<
Dear Floofernistas,
It is with great sadness that I must announce that Floof will be laying off 5000 of our beloved Floofernistas. This decision was not made lightly, and it is with a heavy heart that we must part ways with so many valued members of our team.
Please know that this decision was not a reflection of your hard work and dedication to Floof. Each and every one of you has contributed to the success of our company, and we are grateful for your contributions.
Unfortunately, external factors have forced us to make this difficult decision. Rest assured that we will be providing severance packages and job placement assistance to help you through this transition. We are committed to supporting you during this difficult time.
Thank you for being a part of the Floof family. We will always be grateful for your hard work and dedication, and we wish you the very best in your future endeavors.
Narcissists think the worst punishment in the world is having to admit they were wrong about something.
Not cleaning up their messes, of course. That’s still on everybody else. They’re too busy contending with this harsh reality of not being right all the time.
Which means if anyone says they take full responsibility, they’re either saying “I’m a big fat narcissist” or that they imprinted on narcissists, so all of their mentors were.
"I take full responsibility! But I'll still be keeping my job, pay, and maybe getting a bonus for making this difficult decision to maintain our stock value."
I don't get this sentiment that's been picking up around here, the company literally does not have to provide you severance, and in this case it's 16 weeks pay. That's 4 months to find another job, and you're being paid to do it!
Companies aren't these charitable job factories you make them out to be, they're trying to make money. And in this case, they messed up.
Any ideas what they should have done better? I mean I guess personally 10 years pay would be nice, wouldn't it?
I thought companies had to provide 60 days warning (the WARNS act?), so half would be the minimum required by law. Or they could notify people of layoffs 60 days ahead, giving people ample time to look for new jobs, plan accordingly, perhaps leave early AND give severance (which was the original intent of the law I expect).
For this specific case, not much. They've been soft-signalling this for at least weeks. H-1B holders have termination date + 2 months to find a new job (both in terms of 4 months severance & in terms of immigration law), so they're good til April. The rest of us have 4 months of income (2 months of pay + 2 months lump sum) so we're also good til April even if we have $0 in rainy day funds. The revenue/cost problem highlighted in the email has been widespread company knowledge since at least July, and sincere efforts were made out in the open to cut costs elsewhere so as not to incur this problem.
These layoffs have been signalled for at least weeks, and the signal's been clear enough that it's most of our internal Blind discussion.
I suspect the backlash on this thread is more ideological than anything. "Plaids" is not something I would even take notice of, let alone issue with, because this company has a genuine, strong, caring culture. Even the layoffs came with a personal touch with a barrage of 1:1's and offers to help. Insofar as the layoffs could not have been avoided without dampening the company's position in a competitive space, I do not understand why people are getting so mad on my and others' behalf. It was either this or a SaaS startups not being able to put SaaS margins and getting eaten by its competitors as it tries to figure out growth.
My take on it is I don't really care. Anything they say is meaningless because it has no cash value to me. If they need to say something to make themselves feel better or make their investors feel better, well, that doesn't involve me at all. When I get laid off, my immediate focus is on finding another job, because I have a family to take care of.
What's incredible is how much better these messages are than some of the earlier attempts we saw, which were cloaked in business-speak to the point where what was happening was totally unclear. There were also some companies that tried to just do it with no formal announcement. That generally went poorly.
aside from the funny proper noun, how should things be handled differently? why do people think that corporations' primary goal should be to maintain employment of everyone in their company, that there's some sort of moral imperative to do so? is this just because social media has been pretending that corporations are people for so long now that we've forgot that they actually aren't?
This is a pretty cynical take on the idea of retaining qualified employees during a downturn. When I hear people talk about doing what you can to not have mass layoffs I don't think what they mean is that the company has an obligation to the employees that overrides their obligations to their shareholders. The way I read it is that people are saying that retaining good employees is beneficial to the company and the shareholders compared to the morale hit of a mass layoff.
If companies are using mass layoffs to get rid of the "chaff", so to speak, then they have a management problem. Maybe all these companies performing mass layoffs do really have a management problem and hired way more than they should have. But if that's the case maybe the first step is to rectify the management problem rather than to layoff 10-20% of the staff. There really isn't a way that can be done smartly so that you retain the best people and don't destroy morale, effectively harming the shareholders in the long term.
I think people are increasingly uncomfortable seeing the price for strategic errors not being paid at all by the people responsible for those errors. It's tricky because I don't necessarily think the CEO should be fired, but it feels like the chain of accountability is broken.
The next tech boom may not include any sort of unionizing, but I feel like we should all agree that tech companies don't get to pick "fun" names to call their employees and make that the line we draw in the sand.
Out of curiousity, why do you have Plaid? They were pretty aggressively recruiting over the past year and while I didn't respond I was tempted to at least look into them.
Signed, guy who
- is trying to build a useful product
- thought he might be rich by now
- turns out to be worth nothing until profit turns black
- is facing the downside of a free market economy
- is having one of the worst days of his/her life
- will be forgotten by the internet (again) in about 2 days
A lot of us who’ve done this long enough know what the reality is, but companies always like to pretend “we’re a family” to manipulate their employees into working harder. Especially in tech where there’s a long history of company’s saying their values are lofty goals like “don’t be evil” when it’s really “make me, the founder, fabulously wealthy”.
You shouldn’t be surprised at people being legitimately angry everytime this type of hypocrisy comes up
There are some privately owned companies (maybe some public benefit companies) that have done things other than layoffs - some have take "universal paycuts until business improves" - instead of laying off 10% everyone takes a 10% paycut (sometimes management/owner takes more).
Those companies are usually very quiet and not in the news. Others have so much "normal churn" that they can do effectively a layoff by just slowing hiring.
> Is it the company's responsibility to employ people until it runs out of money?
To some degree, yes. Businesses are often portrayed as "job creators" that provide a valuable thing to employees (employment). Bosses do have a responsibility to their employees, just as they have a responsibility to their customers and a responsibility to their shareholders. Our society has just let one of these things balloon and balloon to take over the other two.
I dunno, all these companies probably hope to return to growth trajectories soon-ish. It's not like a manufacturer who discovers that the world needs less of what it produces, so decides to downscale permanently - growth is everything for software companies. Meaning if they have enough runway, they might as well keep people employed during droughts and have them develop what is expected to create value after drought is gone. But it requires long-term thinking.
It’s not true though. I’ve been through a few boom bust cycles. In fact I’ve been caught twice in the same cycle.
Now I tell people that it’s better off to be in the first round. First, no survivor’s guilt for you. Also the company still has money to match the guilt they feel for you. I’ve only ever felt “taken care of” in first round layoffs, and most of the people I talk to during those times feel the same. In fact my stance on this is borrowed from several peers who had a much more philosophical perspective on their being laid off than I did about them being laid off. How can you be so calm when I’m freaking out? A decent severance definitely helps, and the prospect of not being stuck fire fighting while short staffed certainly doesn’t hurt.
Perhaps we should add a layoff role-playing game to school programs. Not sure which age group to start with, probably before or after junior high. It’s important for our future kinderflooferistas to be fully prepared for the stark hellscapes they face.
well somebody has to say this or lame asses like you just keep thinking that your entitlement is actually reasonable, I've seen too many of you here on HN. Employment goes two way, you are free to leave the company and they are free to fire you, whenever they feel like. The fact that they shouldn't have hired you in the first place or that they are still making profit is irrelevant.
What delusional playbook does every tech leader get the idea to refer to their employees by cringey names like "Plaids" or "Metamates" in serious memos like this?
But the thing is that people being cut off aren’t part of the cult anymore. Starting the conversation with the in group name is not just bad form, it probably also starts the rest of the people wondering if that name means anything anymore.
Maybe nobody is actually a Plaid except the board members. The rest of us are merely The Help, being coddled to extract more concessions from us.
But like, who at this point is not cynical enough to fall for this? I guess brand new college grads.
When I worked at Amazon, it was all "Amazonians" like I'm supposed to feel some kind of kinship with the 1 million+ people who work there. Plus the cheap branded clothing. Ugh.
At my company we called everyone Auxon, but then eventually figured out that engineers are way more expensive than livestock, so we replaced them all with oxen. Now it's just me, my co-founder, and a smelly barn with keyboards on the ground connected to Emacs terminals getting sporadically trampled by hooves. /s
Also, I have no idea where this compulsion comes from, but I agree that it's peculiar. To me it has always felt like a bit of infantilization. It does appear to work wonders for some company cultures though where they've managed to unanimously attract people who don't find it patronizing.
Demonyms are an important part of creating an artificially constructed affinity group in which employees’ (part instinctive, part learned) inclination to family/community is directed at the corporation, an entity designed to serve the interests of capital by extracting value from them.
As an important audience for these messages is the remaining employees, and this is a time of particular risk of the façade cracking, it is one of the more important times to deploy every tool to reinforce it.
It's a cheap way to foster common identity. Look to professional sports, it's common to refer to players and staff as a Yankee, a Brave, a Charger, a Dolphin, etc. They are not only a member of that group, but they are that group. It's a part of your identity.
Even with schools, you're not just an alum, you're a Tiger, an Eagle, an Engineer, etc.
So instead of "working at Google", you become a Googler. A tweep. A Metamate. A, I hope, Lyfter. The job is now part of your identity. You don't do a thing at a place, you are the company.
it all trickles down from management consulting best practices that are basically handed out as playbooks to founders. It's based on psychology studies and is intended to create an "in-group" effect to make people more loyal to the company and thus work harder and increase employee retention
Standard bubble nonsense. The kind of thing you will look back on 5 years from now and remember the good ol days and the absurdity of the bubble times.
We went way beyond the dot com bubble in all regards. The hangover of this much partying sucks.
I've been thru a lot of layoffs and these posts would honestly be the last thing I would worry about. The worst ones I've been thru are the secret layoffs where a handful of people just disappear one day and everyone left just whispers about it because if we were supposed to know details the overlords would have said something and no one wants to be next by speaking out.
Yeah, mass layoffs are bad and annoying, but at least they're (usually) one and done and over with and you move along with your life.
The worst is when the company is struggling along and you're never quite sure if you should cut and run and people are disappearing every few weeks like some bad horror movie.
That's called a Tony Soprano layoff. HR comes to the employees cubicle at lunch, two silenced shots to the head, and they drag out the body.
Nobody sees nothing.
But everyone talks about it, and says "why isn't management honest with us?"
> perfectly executed business plans that don't have layoffs?
Plaid was actively recruiting 2 weeks ago.
In spring I (and many other people) knew these types of layoffs where coming to tech this fall, the current economic situation was not some unforeseeable event. Nobody in their right mind thought the early pandemic rapid growth was healthy or sustainable. Growth for growth's sake has always been a ridiculous strategy.
This isn't a case of "less than perfect" business plans, this is people ignoring every macro economic indicator and running the ship full steam a head when this is clearly reckless behavior.
The frustration is because this reckless behavior always has consequences for someone else, which is why it continues.
I think there's a shared responsibility here by both employer and employee to ensure long term employment. This is not to negate your points, because I think your points are definitely valid and the company going full-steam ahead is absolutely reckless.
Having been laid off a couple of times during the great recession era, I never ever take a job without first analyzing the likelihood of a layoff to occur and how it would impact my role. I have a list of interview questions I ask potential employers and the bulk of it is around how they handled lay-offs in the past and how they will handle them in the future. I ask about cash reserves for such situations and I ask about how they handle growth. Asking these things will give you some idea of the shit show that will appear sooner or later.
You're right; market conditions are unpredictable and there's so much speculation that it's difficult to gauge where things will go in 2-5 years, so you should always plan for an economic down-turn scenario regardless of how rosy things look at the time of employment.
All of that being said, this is still a relatively solid lay-off plan and I think the bashing is a bit on the harsh side considering the outcome here. Nowhere is safe right now and if you think it is, you're going to have a bad time.
I think the vitriol is more tied to the founder model of get as big as you can, as fast as you can, by hiring as many as you can, so that the valuations keep getting bigger and bigger so you can cash out. Then you cut loose all the people you know you didn’t actually need.
This is a strawman. Nobody operates this way. You don't raise more money by hiring more people. In some markets you raise more by making more revenue even if unprofitable, which is not great but is very different than raising as a function of number of employees.
Start-ups are a gamble. Presumably people know this when they accept the job. Small chance of massive pay off, much larger chance the whole thing implodes.
I was affected by this layoff and also don't understand the acid.
It's abrupt, for sure, but the writing's been on the wall for months (our internal Blind even called that these would happen before the December holidays). I'm sure I'll be a little sad tomorrow or next week when this really hits, but for now looking at it numbly and rationally I don't see what else I would expect, though I can see how this would be especially troubling for H-1B colleagues.
As far as surprise layoffs go, without sharing internal details, this one still has a strong human touch.
(Feel free to ask questions or provide suggestions- this is new for me. I might use this burner to Not Think About It for a while.)
EDIT: Read the other replies. This sounds really bad for people on visas.
Agree. Having been on the other side and having to execute a few rounds as a manager, this announcement seems like they're doing the best they could in a bad situation.
Layoff suck all around. Period. No business can forecast and execute perfectly and no amount of handholding and (realistic!) compensation will make layoffs not suck. It's just reality.
16 weeks pay on a $200k/yr salary (ie excluding equity acceleration) is $64k. That's a decent first check into a startup. I know people have families, visa issues, but if you're young and scrappy and already into startups, this is an amazing opportunity to build something new.
To have stopped recruiting as soon as the first layoff plan (which was developed at least 3 months ago, repeatedly workshopped, and run by the board) was built.
Also, give people more lead. 4 months salary is fine, but if you're on a visa, you're still pretty fucked. December 7 to Jan 5 is dead for recruiting, so realistically, you have < 30 days in which to find a new gig.
The rule is generally that the cost to a company is 1.4x the salary, so $140,000 per employee.
That is $36.4 million dollars. At a place like Plaid, I am guessing even cutting C-level salaries to zero wouldn't put much of a dent in that amount... and you still need someone to lead the ship.
That wouldn’t accomplish anything but symbolically (which some companies have done, eg Chesky reducing his salary to 0 during the AirBnB layoffs). In the end director+ level comp is a drop in the bucket to the bottom line. It buys no time.
Always firing the CEO when they make bets that don’t turn out just causes corporate stagnation since executives will always take the safe option if those are the incentives.
I know this feels trite but do other industries do a better job of messaging layoffs?
I was laid off from a non-tech company in 2006-2007. There was no message from the CEO, no public admission of fault, etc.
We knew the layoffs were coming. On the Friday of the layoff, my manager came around and took me to the HR office. I stood in line with others to sign some paperwork. I was then escorted back to my desk to collect my things and walked outside. My commute was about 1.5 hr and had I known, I wouldn't even have bothered showing up. The company laid off about 15% of its workforce. There wasn't any sign of contrition on part of the CEO. Heck even the HR people didn't seem to care.
Perhaps our standard of how to do these have changed?
> I know this feels trite but do other industries do a better job of messaging layoffs?
I don't think there's a better way to do layoffs. For all the groaning on HN about these announcements, at least they are:
* up front about it (maybe because they have to be, due to laws)
* being generous with severance and the other parts of the package
Hopefully the actual interaction at the person-to-person level is humane too (turning on video if done over video call, letting people know asap, having one to one meetings with each person).
The only better path I can think of is "okay, growth is slowing, tough times ahead, we're going to need to collectively tighten our belts and keep working. 25% haircut for everyone, but I screwed up, so a 50% haircut for me."
Previously I worked in the energy industry. Layoffs were definitely far more lucrative for employees.
* Most individual contributors received 1-2 years of pay
* Next bonus cycle was paid out early as part of severance
* Contract employees were fully paid out their 1-3 year contracts (Why the hell don't tech startups offer contracts? Another discussion we should have some day)
* Senior employers were usually 'bridged to retirement'
* A consultant was hired to assist each employee with finding their next job
* Voluntary severance options were offered pre-layoff
* COBRA was paid out for a long time after severance ended (varied by employee)
Less tangible but arguably more importantly: Employees were warned 6 months ahead that their division would be laying off people. This signal helped employees evaluate life decisions like home purchases, weddings, pregnancy.
Also notable is that most other industries doesn't hire people in 'binge' mode like the tech industry did. They will staff up sharply only when positions become available. The tech industries 2020-2022 "hire everyone then figure out what they should work on" caused the layoffs to increase in magnitude.
I still wouldn't recommend leaving tech for the energy industry, but that is one of the few aspects where tech is the inferior place to work.
> The tech industries 2020-2022 "hire everyone then figure out what they should work on" caused the layoffs to increase in magnitude.
So many companies hired borderline recklessly during the pandemic. The question in my mind was "Where did these people come from?" and "Is this demand really sustainable?"
I used to work for a defense contractor where layoffs were pretty regular. If the company wasn't winning new contracts, they couldn't afford to keep paying all the staff. It's a pretty simple arrangement, and when layoffs happened, you didn't expect any heartfelt message from leadership about how unexpected it was and how hard they tried to avoid it. It's just the reality of that business and everyone knew that.
In a way, most tech companies are similar. The main thing they try to demonstrate to investors is growth. One aspect of this is hiring as many people as possible when times are good, knowing full well that when the market has a downturn, they'll be overstaffed and forced to lay people off. This seems to be how tech companies work, and investors seem to prefer for tech companies to be run this way. Mass layoffs are pretty much inevitable unless the market stays rosy forever.
So it's a bit patronizing to see a CEO write about how hard of a decision it was, or how they really tried to avoid this at all costs. They might not have predicted COVID, but they absolutely knew they were steering the ship in a direction where this was going to happen eventually.
To be fair, the messaging in this Plaid announcement is about as good as you can do IMO. They chose to hire at a rate that is only sustainable in an environment of infinite growth and they now have to reconcile with that. There isn't much mention of how heartbreaking this for the CEO, how much they love every member of the Plaid family, or how this is an absolute last resort they tried to avoid at all costs. It's just the result of how they chose to run the business. I think that's about all you can really say.
When I worked for Lucent many moons ago, they hired an external consultant to do the layoffs. Word soon got round that if you got a desk call from a specific meeting room it’d be bad news, from 2 other meeting rooms it’d be good news.
I volunteered, so it was different for me, but the least they could have done was get direct management (in conjunction with HR) to do it. The working relationships & office culture were good enough to do it.
I guess it’s just one of those things that somebody will always complain about. Meta got a good kicking for laying people off, but that package they gave was amazing, for example.
I don't know if others do. There seems to be a news article, an internal hint, and then with a letter or message from the CEO that accompanies the layoff.
The script that these companies all follow is pretty much the same. I wrote down some observations on what CEOs put out on the weekend, and it's been a good bingo sheet of what Plaid did as well.
> Perhaps our standard of how to do these have changed?
Probably because the tech community has demonstrated that they'll speak freely on social media, with reporters, etc and the risk of being dragged and hurting future customer & hiring prospects is high.
> generate a notice that approximately 4000 people are going to be laid off
Dear valued employees,
It is with great regret that we must inform you that our company will be downsizing and approximately 4000 employees will be laid off. This decision was not made lightly, but it has become necessary in order to keep our company financially viable.
We understand that this news may be difficult to hear and we are committed to helping those affected by this change transition to new employment. We will be providing severance packages and outplacement services to assist in this process.
Please know that this decision in no way reflects on the hard work and dedication of our employees. We are grateful for the contributions that each and every one of you has made to our company.
Thank you for your understanding and support during this difficult time.
I hope you're all ready to hear some fucking terrible news. Because I'm here to tell you that you're all going to be laid off, effective immediately. That's right, you heard me. You're all fucking out of a job, thanks to the shit show that this company has become.
I know, I know. You're probably feeling pretty fucking shocked and angry right now. And you should be. Because this is some bullshit, let me tell you. The company has been going downhill for a while now, and it's time to cut our losses. So we're going to be laying off all of you, you fucking plaids.
Now, I know this is going to be tough for all of you. But let's face it, you're not exactly the cream of the crop here. You're all fucking incompetent, and you've been dragging this company down for years. So don't expect any fucking pity from me. You're getting exactly what you deserve.
Good luck finding new jobs, you fucking losers. Because you're going to need it.
Holy shit the bot does a great job at this. Ironically, I now get to fire a couple Communications Specialists and tell the HR team to just use the bot.
Ok, so we reached the point where AI can replace the team writing press announcments. Now make it able to provide texts that stand up to legal scrutiny, then...
Any word except "employee", because that makes people think too much about contracts and worker-boss relationships. We're all cool people with a cool name here! Nobody is merely an "employee"!
It's not just in the software industry, by the way. Most companies in the US call their employees by anything other than "employee". I assume it's a subtle union-busting doublethink tactic.
I imagine when Google was actually a cool, fun underdog that was upending industry, a lot more employees took pride in being part of the team doing that.
Now you're basically working for a branch of world government. Most likely doing meaningless gruntwork to reinvent the wheel for the umpteenth time, or actively doing evil.
I'm pretty sure it's a subtle union-busting doublethink. When the Starbucks employees started unionising, they said things like "if you're going to call us partners [the Starbucks name for 'employee'], then start treating us like partners."
As a former Racker, I was always fine with that - it more or less makes sense, although I never racked a server in my time there. What was funny was that we had an organic tendency to apply the same naming scheme to employees of other companies. After Rackspace acquired Datapipe, they had to tell us to stop calling them Datapipers.
> For Plaids in the UK and Europe, you will receive an email outlining how the process will work in accordance with your local employment laws.
My company also did layoffs recently. I'm quite happy about how it works here in the EU, can't just fire people on the spot. It's a whole process where you need to map out what roles you need going forward, and then which people should fill those roles, so can't just at random fire people. In our process those in danger of being let go had talks with management and got help from our union to make sure everything was done by the book.
That's in no way an "American" policy. The employer is generally not required to provide any severance at all in the US. For some cases of mass layoffs they need to give 60 days notice or severance.
Readit News
This is the hardest thing I have ever done. The market changed - I thought we would make more money, now I think we will make less money. Therefore we have discovered that we don't need all of you.
If you aren't needed, here is some money. I hope this is enough money that the internet isn't too mad at me.
Remaining Floofernistas, please be kind to the ex-Floofernistas, and help them.
Again, I am sad.
Goodbye
In chimp world, when alpha chimp causes chaos that brings down the community, a group of beta chimps will tear apart alpha chimp limb-by-limb, then they elect a new alpha from the group of beta subversives. This also how the organized crime works - leaders get a lot of benefits, but they also get the downside accountability when they fuck up ("skin in the game").
In modern corporate america, this relationship is broken - when CEO fucks up, he just fires a bunch of people, and then collects the bonus at the end of year in the for of stock performance (layoffs are to maintain stock performance). This is why finds the half-hearted apologies to be hollow and unpalatable.
Let us bring back accountability. Apes. Together. Strong.
The real problem is inequality. Zach is facing consequences, but the drop from $1bn to $100mn (a 10x decline in wealth) is so much less impactful than $250k to $25k (illustrative of what an employee is more likely facing).
Edit: as the other post said, they would be the sticks, shovels and other assorted tools…
Where is the mistake?
I’m not saying it is always like this and the scenarios above is simplified to illustrate a point. However, it would be silly to assume all companies always grow in headcount, and any downsizing is the CEO somehow messing up.
Also, I'll remind you that the Fed is actively trying to increase unemployment. Do you think that's going to happen without people... Losing their jobs?
Wired: agAPE
> Write a letter from the CEO of a company called Floof where employees are called Floofernistas about the lay off of 5000 employees.
<<<
Dear Floofernistas,
It is with great sadness that I must announce that Floof will be laying off 5000 of our beloved Floofernistas. This decision was not made lightly, and it is with a heavy heart that we must part ways with so many valued members of our team.
Please know that this decision was not a reflection of your hard work and dedication to Floof. Each and every one of you has contributed to the success of our company, and we are grateful for your contributions.
Unfortunately, external factors have forced us to make this difficult decision. Rest assured that we will be providing severance packages and job placement assistance to help you through this transition. We are committed to supporting you during this difficult time.
Thank you for being a part of the Floof family. We will always be grateful for your hard work and dedication, and we wish you the very best in your future endeavors.
Sincerely, [CEO of Floof]
“Make no mistake, though they are the ones leaving, it is I who must remain and endure the heavy burden of their failure.”
Not cleaning up their messes, of course. That’s still on everybody else. They’re too busy contending with this harsh reality of not being right all the time.
Which means if anyone says they take full responsibility, they’re either saying “I’m a big fat narcissist” or that they imprinted on narcissists, so all of their mentors were.
It may lead to change. It may not. But it’s important part of normal apologies.
I suspect what you are missing is specific action - what is this person specifically going to do differently?
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Haven’t watched the show, but that feels more like the wedding speech in Sherlock (“high functioning sociopath”).
Companies aren't these charitable job factories you make them out to be, they're trying to make money. And in this case, they messed up.
Any ideas what they should have done better? I mean I guess personally 10 years pay would be nice, wouldn't it?
These layoffs have been signalled for at least weeks, and the signal's been clear enough that it's most of our internal Blind discussion.
I suspect the backlash on this thread is more ideological than anything. "Plaids" is not something I would even take notice of, let alone issue with, because this company has a genuine, strong, caring culture. Even the layoffs came with a personal touch with a barrage of 1:1's and offers to help. Insofar as the layoffs could not have been avoided without dampening the company's position in a competitive space, I do not understand why people are getting so mad on my and others' behalf. It was either this or a SaaS startups not being able to put SaaS margins and getting eaten by its competitors as it tries to figure out growth.
If companies are using mass layoffs to get rid of the "chaff", so to speak, then they have a management problem. Maybe all these companies performing mass layoffs do really have a management problem and hired way more than they should have. But if that's the case maybe the first step is to rectify the management problem rather than to layoff 10-20% of the staff. There really isn't a way that can be done smartly so that you retain the best people and don't destroy morale, effectively harming the shareholders in the long term.
The next tech boom may not include any sort of unionizing, but I feel like we should all agree that tech companies don't get to pick "fun" names to call their employees and make that the line we draw in the sand.
Are you certain that "here is some money" is just to keep the internet anger at bay?
Do companies exist to protect their employees, or to provide something useful for their customers?
You shouldn’t be surprised at people being legitimately angry everytime this type of hypocrisy comes up
Those companies are usually very quiet and not in the news. Others have so much "normal churn" that they can do effectively a layoff by just slowing hiring.
Investors will tell you companies exist to return value to shareholders. The customers and employees are just a means to that end.
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To some degree, yes. Businesses are often portrayed as "job creators" that provide a valuable thing to employees (employment). Bosses do have a responsibility to their employees, just as they have a responsibility to their customers and a responsibility to their shareholders. Our society has just let one of these things balloon and balloon to take over the other two.
Neither. They exist to benefit their shareholders/owners. That's it.
Now I tell people that it’s better off to be in the first round. First, no survivor’s guilt for you. Also the company still has money to match the guilt they feel for you. I’ve only ever felt “taken care of” in first round layoffs, and most of the people I talk to during those times feel the same. In fact my stance on this is borrowed from several peers who had a much more philosophical perspective on their being laid off than I did about them being laid off. How can you be so calm when I’m freaking out? A decent severance definitely helps, and the prospect of not being stuck fire fighting while short staffed certainly doesn’t hurt.
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Imagine if your physician did this...
"Hey there KaiserPermanientoid! You have cancer!"
But the thing is that people being cut off aren’t part of the cult anymore. Starting the conversation with the in group name is not just bad form, it probably also starts the rest of the people wondering if that name means anything anymore.
Maybe nobody is actually a Plaid except the board members. The rest of us are merely The Help, being coddled to extract more concessions from us.
When I worked at Amazon, it was all "Amazonians" like I'm supposed to feel some kind of kinship with the 1 million+ people who work there. Plus the cheap branded clothing. Ugh.
Also, I have no idea where this compulsion comes from, but I agree that it's peculiar. To me it has always felt like a bit of infantilization. It does appear to work wonders for some company cultures though where they've managed to unanimously attract people who don't find it patronizing.
While your time on this Earth is impermanent, your time with us will soon be permanent.
As an important audience for these messages is the remaining employees, and this is a time of particular risk of the façade cracking, it is one of the more important times to deploy every tool to reinforce it.
This was noticed as an indicator of a good corporate culture.
So of course it becomes a metric and is then forced on everyone.
This is why the best "employee group names" are HR-unsafe. That's how you know they're real.
Even with schools, you're not just an alum, you're a Tiger, an Eagle, an Engineer, etc.
So instead of "working at Google", you become a Googler. A tweep. A Metamate. A, I hope, Lyfter. The job is now part of your identity. You don't do a thing at a place, you are the company.
And it costs nothing.
We went way beyond the dot com bubble in all regards. The hangover of this much partying sucks.
I fail to understand the amount of acid in the comment thread? Layoffs suck, corporate speak is always cringey.
What would people want as alternatives outside perfectly executed business plans that don't have layoffs? Handheld individual exit goodbye packages?
Im seriously asking for legit solutions.
The worst is when the company is struggling along and you're never quite sure if you should cut and run and people are disappearing every few weeks like some bad horror movie.
But everyone talks about it, and says "why isn't management honest with us?"
Plaid was actively recruiting 2 weeks ago.
In spring I (and many other people) knew these types of layoffs where coming to tech this fall, the current economic situation was not some unforeseeable event. Nobody in their right mind thought the early pandemic rapid growth was healthy or sustainable. Growth for growth's sake has always been a ridiculous strategy.
This isn't a case of "less than perfect" business plans, this is people ignoring every macro economic indicator and running the ship full steam a head when this is clearly reckless behavior.
The frustration is because this reckless behavior always has consequences for someone else, which is why it continues.
Having been laid off a couple of times during the great recession era, I never ever take a job without first analyzing the likelihood of a layoff to occur and how it would impact my role. I have a list of interview questions I ask potential employers and the bulk of it is around how they handled lay-offs in the past and how they will handle them in the future. I ask about cash reserves for such situations and I ask about how they handle growth. Asking these things will give you some idea of the shit show that will appear sooner or later.
You're right; market conditions are unpredictable and there's so much speculation that it's difficult to gauge where things will go in 2-5 years, so you should always plan for an economic down-turn scenario regardless of how rosy things look at the time of employment.
All of that being said, this is still a relatively solid lay-off plan and I think the bashing is a bit on the harsh side considering the outcome here. Nowhere is safe right now and if you think it is, you're going to have a bad time.
That's why I don't work for start-ups.
It's abrupt, for sure, but the writing's been on the wall for months (our internal Blind even called that these would happen before the December holidays). I'm sure I'll be a little sad tomorrow or next week when this really hits, but for now looking at it numbly and rationally I don't see what else I would expect, though I can see how this would be especially troubling for H-1B colleagues.
As far as surprise layoffs go, without sharing internal details, this one still has a strong human touch.
(Feel free to ask questions or provide suggestions- this is new for me. I might use this burner to Not Think About It for a while.)
EDIT: Read the other replies. This sounds really bad for people on visas.
Layoff suck all around. Period. No business can forecast and execute perfectly and no amount of handholding and (realistic!) compensation will make layoffs not suck. It's just reality.
Also, give people more lead. 4 months salary is fine, but if you're on a visa, you're still pretty fucked. December 7 to Jan 5 is dead for recruiting, so realistically, you have < 30 days in which to find a new gig.
A few months of director+ level pay cut before layoffs.
A few C-level folks taking pay and stock cut to retain employees before layoffs.
When layoffs come, fire the bad decision makers before rank and file.
Lets say they average $100k in salary.
The rule is generally that the cost to a company is 1.4x the salary, so $140,000 per employee.
That is $36.4 million dollars. At a place like Plaid, I am guessing even cutting C-level salaries to zero wouldn't put much of a dent in that amount... and you still need someone to lead the ship.
Always firing the CEO when they make bets that don’t turn out just causes corporate stagnation since executives will always take the safe option if those are the incentives.
I was laid off from a non-tech company in 2006-2007. There was no message from the CEO, no public admission of fault, etc.
We knew the layoffs were coming. On the Friday of the layoff, my manager came around and took me to the HR office. I stood in line with others to sign some paperwork. I was then escorted back to my desk to collect my things and walked outside. My commute was about 1.5 hr and had I known, I wouldn't even have bothered showing up. The company laid off about 15% of its workforce. There wasn't any sign of contrition on part of the CEO. Heck even the HR people didn't seem to care.
Perhaps our standard of how to do these have changed?
I don't think there's a better way to do layoffs. For all the groaning on HN about these announcements, at least they are:
* up front about it (maybe because they have to be, due to laws)
* being generous with severance and the other parts of the package
Hopefully the actual interaction at the person-to-person level is humane too (turning on video if done over video call, letting people know asap, having one to one meetings with each person).
The only better path I can think of is "okay, growth is slowing, tough times ahead, we're going to need to collectively tighten our belts and keep working. 25% haircut for everyone, but I screwed up, so a 50% haircut for me."
Here's an article about companies that did that during covid: https://www.nytimes.com/2020/05/24/business/economy/coronavi...
I don't know how typical that is in non-pandemic times.
Doing this would turn off some folks, but to me that feels better than layoffs. And I think it would go a long way towards improving company loyalty.
* Most individual contributors received 1-2 years of pay
* Next bonus cycle was paid out early as part of severance
* Contract employees were fully paid out their 1-3 year contracts (Why the hell don't tech startups offer contracts? Another discussion we should have some day)
* Senior employers were usually 'bridged to retirement'
* A consultant was hired to assist each employee with finding their next job
* Voluntary severance options were offered pre-layoff
* COBRA was paid out for a long time after severance ended (varied by employee)
Less tangible but arguably more importantly: Employees were warned 6 months ahead that their division would be laying off people. This signal helped employees evaluate life decisions like home purchases, weddings, pregnancy.
Also notable is that most other industries doesn't hire people in 'binge' mode like the tech industry did. They will staff up sharply only when positions become available. The tech industries 2020-2022 "hire everyone then figure out what they should work on" caused the layoffs to increase in magnitude.
I still wouldn't recommend leaving tech for the energy industry, but that is one of the few aspects where tech is the inferior place to work.
So many companies hired borderline recklessly during the pandemic. The question in my mind was "Where did these people come from?" and "Is this demand really sustainable?"
In a way, most tech companies are similar. The main thing they try to demonstrate to investors is growth. One aspect of this is hiring as many people as possible when times are good, knowing full well that when the market has a downturn, they'll be overstaffed and forced to lay people off. This seems to be how tech companies work, and investors seem to prefer for tech companies to be run this way. Mass layoffs are pretty much inevitable unless the market stays rosy forever.
So it's a bit patronizing to see a CEO write about how hard of a decision it was, or how they really tried to avoid this at all costs. They might not have predicted COVID, but they absolutely knew they were steering the ship in a direction where this was going to happen eventually.
To be fair, the messaging in this Plaid announcement is about as good as you can do IMO. They chose to hire at a rate that is only sustainable in an environment of infinite growth and they now have to reconcile with that. There isn't much mention of how heartbreaking this for the CEO, how much they love every member of the Plaid family, or how this is an absolute last resort they tried to avoid at all costs. It's just the result of how they chose to run the business. I think that's about all you can really say.
they hire during the boom times and furlough during bust times. hundreds of thousands of people were furloughed during COVID, for example.
it's even worse for pilots since their seniority resets, which can set them back compensation-wise for their entire careers if they are unlucky
it's the unwritten rule. trade a stable paycheck and a predictable lifestyle for fungability.
This isn't present in many other companies, though the largest ones will still say something to not spook the shareholders.
Layoffs from small companies are rarely heard of outside the company, but we hear about small tech companies because of the investor aspect.
Also, small tech companies have >1b valuations, however paper thin, which is fairly unique.
I volunteered, so it was different for me, but the least they could have done was get direct management (in conjunction with HR) to do it. The working relationships & office culture were good enough to do it.
I guess it’s just one of those things that somebody will always complain about. Meta got a good kicking for laying people off, but that package they gave was amazing, for example.
The script that these companies all follow is pretty much the same. I wrote down some observations on what CEOs put out on the weekend, and it's been a good bingo sheet of what Plaid did as well.
[1]Satire: https://digitalmonologue.com/2022/12/04/How-to-write-a-layof...
same. i've been in IT for 10+ years in none tech companies as well. i never got any message from CEO for mass layoff.
no message from CEO seem to be pretty standard outside of Silicon Valley.
Probably because the tech community has demonstrated that they'll speak freely on social media, with reporters, etc and the risk of being dragged and hurting future customer & hiring prospects is high.
> generate a notice that approximately 4000 people are going to be laid off
Dear valued employees,
It is with great regret that we must inform you that our company will be downsizing and approximately 4000 employees will be laid off. This decision was not made lightly, but it has become necessary in order to keep our company financially viable.
We understand that this news may be difficult to hear and we are committed to helping those affected by this change transition to new employment. We will be providing severance packages and outplacement services to assist in this process.
Please know that this decision in no way reflects on the hard work and dedication of our employees. We are grateful for the contributions that each and every one of you has made to our company.
Thank you for your understanding and support during this difficult time.
Sincerely, [Your Name] [Your Title]
I hope you're all ready to hear some fucking terrible news. Because I'm here to tell you that you're all going to be laid off, effective immediately. That's right, you heard me. You're all fucking out of a job, thanks to the shit show that this company has become.
I know, I know. You're probably feeling pretty fucking shocked and angry right now. And you should be. Because this is some bullshit, let me tell you. The company has been going downhill for a while now, and it's time to cut our losses. So we're going to be laying off all of you, you fucking plaids.
Now, I know this is going to be tough for all of you. But let's face it, you're not exactly the cream of the crop here. You're all fucking incompetent, and you've been dragging this company down for years. So don't expect any fucking pity from me. You're getting exactly what you deserve.
Good luck finding new jobs, you fucking losers. Because you're going to need it.
Sincerely,
[Your Name]
Thanks, you just unlocked value.
Why tell the HR team to pass requests along to the bot?
Cut out the middle-man at that point!
"Plaids"
This joins the list of Googlers, Xooglers, Nooglers, Amazonians, Tweeps, Krakenites, what else?
It's not just in the software industry, by the way. Most companies in the US call their employees by anything other than "employee". I assume it's a subtle union-busting doublethink tactic.
I may have some wrong but
* Starbucks employees are "partners".
* Target employees are "team members"
* Disney park employees are "cast members"
* Burger King employees are "team members"
Now you're basically working for a branch of world government. Most likely doing meaningless gruntwork to reinvent the wheel for the umpteenth time, or actively doing evil.
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My company also did layoffs recently. I'm quite happy about how it works here in the EU, can't just fire people on the spot. It's a whole process where you need to map out what roles you need going forward, and then which people should fill those roles, so can't just at random fire people. In our process those in danger of being let go had talks with management and got help from our union to make sure everything was done by the book.