Companies Are Not Families
The Wall Street Journal ran an article this month with the headline: "The Bosses Are Back in Charge Again." But the opposite is true — workers now have more power than ever. Consider these facts. Last month the number of open jobs rose to 11 million, up 5.5% from the previous month. The unemployment rate fell to 3.4%, the lowest in 53 years. There are now 1.9 jobs available per unemployed worker. It’s hard to argue that hiring managers have the upper hand.
But what about all of those layoffs we keep hearing about? Could it be that today’s carelessly laid off workers are making more noise than those who were handed pink slips in the past? Instead of sitting in their houses angry and depressed, both they and their employed colleagues and friends are taking to social media to let the world know that they feel they have been mistreated and misled.
“Now employees have a vehicle and a voice,” said Heather McGowan, a future of work strategist and co-author with Chris Shipley of the forthcoming book, "The Empathy Advantage."
Companies that regularly earned top marks as providers of employer experience are now known for letting go of top performers via email — and often without as much as an opportunity to have a conversation with their boss. Not a good practice, according to Sarah J. Rodehorst, CEO of Onwards HR, an end-to-end separations platform that ensures consistent, fair and supportive employee exits. "People have been shocked, jolted, they didn’t see this coming. They feel disrespected, at least their manager could talk to them," said Rodehorst.
Reputations which took time to build are shattered. Those who remain may be quietly quitting because they now know that working hard and earning high marks won’t save their job.
Real Families Don't Downsize When Times Get Tough
For years CEOs at companies like Salesforce preached that their employees, partners and customers were family. Salesforce CEO Marc Benioff still talks about “Ohana,” which in Hawaiian means family. In a tweet on June 24, 2022 he wrote “I believe CEOs have a responsibility to take care of their employees — no matter what. Salesforce moves employees when they feel threatened or experience discrimination. To our Ohana — we always make sure you have the best benefits & care, & we will always have your back. Always.”
On January 4, 2023, Benioff sang a different tune. The company sent out more than 7,000 emails to select members of Ohana telling them that they were laid off, even though many had performed well in their jobs. Employees and onlookers may have been more forgiving if the company was suffering financially, but Salesforce has plenty of cash. Or, members of the Ohana might have been willing to take temporary pay cuts the way EMC’s did in 2009. After all, don’t families talk about problems and arrive at solutions by working together?
A comment on a New York Times article about Salesforce read, “If you are interviewing with a company and they describe themselves as a family, run away. They are starting their relationship with you on the basis of a lie. Families don’t downsize members when things get tough. That’s the nice thing about families. Companies are not families; they are profit centers first and a place for you to make your living second. If they are clear about that from the beginning, you’ve got a better chance that there is a rational management team who might be able to weather a storm without destroying too many lives with layoffs.”
Recessions don't last but trust and relationships take a long time to build. This is what companies laying off employees failed to understand. We need better leaders. Period. #layoffs #BigTech #HBR #Google #Facebook #Twilio #Twitter #Salesforce
— Francis Foo (@francisfooqh) February 16, 2023
But laying off good workers was not the only questionable move Benioff made; we’ll get to that one later.
Related Article: The Problem With Employee Experience Today
No Longer an Employer of Choice
Google may not have done much better trying to preserve its hard-earned employer brand than Salesforce. The company’s founding motto “do no evil” seems gone. Among its current values is caring for families. Yet the mothership, Alphabet, laid off 12,000 workers by email. At the time the layoffs the company held enough cash in its piggy bank to pay the workers it kicked out for 27 years, according to Cory Doctorow.
Three weeks ago, @Google lays off 12k people for a 5% stock bump.
— Families of Google Layoffs (@Google_Layoffs) February 8, 2023
High performers were let go, so employee morale sinks. Then no one fact-checks a critical advertisement. Stock down 8%.
Will @sundarpichai take responsibility? https://t.co/Ky3m6gb8HS
“It’s hard for me to believe after 20 years at #Google, I unexpectedly find out about my last day via an email. What a slap in the face. I wish I could have said goodbye to everyone face-to-face," ex-Googler Jeremy Joslin tweeted. The tweet has received 42,900 likes and almost 4,000 retweets thus far. That represents the number of people who have read about how Google treats a worker who has been through thick and thin with the company over the last two decades. That’s also the number of workers who may have been dying to work at the company and will now think twice, if they consider the job at all. How’s that for employee branding?
Google may have made its problem bigger when it came out that it had also axed its open-source standouts. On January 30 Matt Asay of MongoDB wrote in an article for InfoWorld, “Google blew it with open source layoffs. The decision to cut people who built the foundation that supports Google’s open source and cloud successes seems incredibly shortsighted.”
In the article Asay continued, “It’s so baffling that the company has laid off some of its best and brightest in open source. People like its longtime open source chief Chris DiBona. Or Jeremy Allison, Cat Allman, and Dave Lester … As an interested onlooker who wants Google Cloud to be successful, I think this is an incredibly naive move. I don’t understand it. At all.”
Google and Alphabet CEO Sundar Pichai has a lot to explain to the well-connected open-source community that Google Cloud needs to succeed. Otherwise, they may not be as eager to contribute to associated open source projects.
Learning Opportunities
From a broader perspective it’s hard to reconcile what Google claims to be with its actions. One Googler who works as a security engineer told Business Insider, "That wasn't the culture that we worked in, at least before that point. How Google (just) behaved was not Google."
Another Googler, told Insider, "Google felt like my home. It was a family ... You could feel it when you walked through the door." He added that he felt taken advantage of and that Google was now “just another company.”
The bad behavior around layoffs isn't only the domain of Google and Salesforce either. Meta CEO Mark Zuckerberg, who recently laid off 11,000 workers and made a pledge to austerity, went to the World Economic Forum (WEF) in Davos, Switzerland in January to talk about the metaverse. Meta lost $9.44 billion at its Reality Labs metaverse unit from January to September last year and it is expected to grow that number in 2023. Microsoft, for its part, hosted a party for around 50 executives at the WEF conference featuring Sting as the entertainment. It laid off 10,000 workers the next day. Salesforce brought in Chrissie Hynde of the Pretenders at its Davos event.
All of these CEOs and others who laid off workers offered would-be comforting phrases like “I take responsibility for that,” “I take responsibility for those decisions, as well as the difficult decision to do this layoff,” “John and I are fully responsible,” “I want to say upfront that I take full responsibility,” What do those words even mean?
Alone, they don’t lead to trust, said McGowan.
Some think it would be good if the CEOs who claimed they were responsible gave up their salaries, bonuses and stock grants for a year and used the money to retain as many workers as possible and train them in technologies of the future so that they are ready when the time comes.
And while executives like Alphabet’s Sundar Pichai, Apple’s Tim Cook, Intel’s Pat Geisinger, Morgan Stanley’s James Gorman took pay cuts, Salesforce’s Benioff went to French Polynesia for a 10-day digital detox.
“What kind of idiot goes to French Polynesia right after he lays off thousands of workers,” said one source.
There’s an easy answer. Someone who doesn’t want to face his Ohana.
That’s a bit harsh, but one thing is certain. “There’s a better way to say goodbye,” said Rodehorst.
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About the Author
Virginia Backaitis is seasoned journalist who has covered the workplace since 2008 and technology since 2002. She has written for publications such as The New York Post, Seeking Alpha, The Herald Sun, CMSWire, NewsBreak, RealClear Markets, RealClear Education, Digitizing Polaris, and Reworked among others.
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