Business

Don’t Call It A Layoff: Big Tech Is Reportedly Using A Trick To Force Employees Out

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Meta and Google have asked hundreds of employees to re-apply for jobs in their companies, using restructuring efforts as a way to quietly release employees without announcing mass layoffs, The Wall Street Journal reported.

Affected employees are typically informed that, due to reorganization efforts meant to cut costs, they will be granted a limited period to re-apply for a job in the company, with managers telling the WSJ that the method allows the company to make cuts quietly. At Facebook in particular, sources within the company are expecting much of a planned 10% cost cut to come from reduced staffing.

A Meta spokesperson referred the Daily Caller News Foundation to comments made by CEO Mark Zuckerberg nearly two months ago, where Zuckerberg said the company needed to be “more disciplined,” and announced the company would “steadily reduce headcount over the next year.” The spokesperson did not answer a question asking to confirm the WSJ’s reporting that restructuring was being used to cut employees without announcing layoffs.

“If Facebook does mass layoffs it’ll be cheaper to get a mortgage” — I mean, that’s just a win for America.

— Conor Sen (@conorsen) September 22, 2022

Both Meta and Google grew significantly in the past twelve months, with Meta having 32% more employees at the end of June 2022 than in June 2021, while in the same period Google parent Alphabet had 20.8% more employees, the WSJ reported. Meta has made the elimination of poorly performing engineers core to the company’s strategy going forward, encouraging managers to work with underperforming employees before firing them.

Meta’s shares have fallen 56.6% in 2022, while Google shares have fallen 27.3%, the WSJ reported.

In contrast to Meta and Google, some other tech firms have announced significant cuts in recent months. In August, both social media giant Snap and retail investing app Robinhood announced they would cut 20% and 23% of their staff, respectively.

Reallocating employees can have benefits by retaining employees who know a company’s system and already have significant working relationships, Allison Rutledge-Parisi, senior vice president of people at professional employee services company Justworks, told the WSJ. However, competition for limited slots can also lead to lowered productivity and morale, according to Dave Fisch, CEO of recruitment site Ladders, speaking to the WSJ.

“There’s going to be a lot of chatter, there could be a lot of animosity and finger pointing that naturally starts to arise,” Fisch said to the WSJ.

Google did not respond to the Daily Caller News Foundation’s request for comment.