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WeWork reader for mass redundancies



On Monday, WeWork's manager, Marcelo Claure, confirmed that layoffs are imminent in an email to employees obtained by CNN Business. In the email, Claure said that all hands scheduled for Tuesday would be moved to Friday "out of respect for the people who will be separated this week."

The spectrum of sweeping layoffs has hung over the company for much of the nearly two months since it failed to pull off an IPO. Employees have been repeatedly told that cuts are coming to the embattled coworking startup, but details have been scarce.
The unfolding saga highlights the risk of working for a high-flying tech startup. While some employees once saw their paper wealth soar when the WeWork valuation rose as high as $ 47 billion in the private market, WeWork valuation has since fallen to a fraction of that. WeWork allegedly delayed layoffs of employees because it could not afford to pay severance pay until they accepted a massive rescue from SoftBank ( SFTBF ) .
In the email, Claure did not specify how many would be laid off, only that "the necessary eliminations of the job" would "start in earnest this week in the United States." Several reports in recent weeks have said that WeWork could cut 4,000 jobs, if not more, with The New York Times reporting that many of these positions are part of its most important business.

WeWork declined to comment on this story.

Given the scale of the business ̵

1; which branched into cohabiting buildings, a gym and a school – the influencers could include a wide mix of professionals, such as engineers, architects, interior architects and cleaning staff. Around 1,000 cleaners and building maintenance staff have already been told that their jobs will be outsourced, according to a new grassroots coalition of WeWork employees advocating for them.

Until the resignation, management has tried to alleviate concerns about the cuts by promising to prioritize treating those laid off with "dignity and respect," Claure said in a separate email for the entire company more than a week ago, which was also obtained by CNN Business. He emphasized that WeWork's business is secure.

Claure is intended to present an updated five-year plan for the company's board of directors on Tuesday, according to this separate email. The company plans to share the same document with employees, which will include financial restructuring, on Friday.
The company has previously said that it will focus on the core collaboration business going forward, and wants to sell many of the startups it has acquired over the years, as well as run its own business games, including the school. Meetup, one of the startups acquired by WeWork, began cutting employees earlier this month, according to several reports.

According to two sources, recurring calendar invitations involving human resources and lawyers using the word "Huxley" are believed to be a code name for the layoffs. The meetings began on October 28.

WeWork has framed its decision to quit jobs as an attempt to "size up" operations and create a way forward after almost crumbling. At the end of October, SoftBank took over majority ownership in WeWork as part of an agreement to pump $ 5 billion into the company following the disastrous IPO attempt. The new package valued WeWork at $ 8 billion.

But the impending layoffs have become a lightning rod issue due to Neumann's golden parachute included in the SoftBank rescue. Despite numerous criticisms of increasing losses and poor corporate governance under his watch, Neumann was given the opportunity to sell up to $ 970 million in stock back to SoftBank, a $ 500 million loan to repay a credit limit and a $ fee. 185 million to consult Softbank. Claure said that the payment was necessary to take control of Neumann's business.

A former WeWork executive told CNN Business earlier that was "disgusting" that Neumann could take so much money off the table while workers' fate was in the balance. Neumann proclaimed the importance of "community," a word that appeared 150 times in the company's IPO papers.
  WeWork & # 39; s disgraced CEO gets a massive payout. Workers are now awaiting their own destiny

There is also clear frustration over the terms of severance – or lack of – for certain employees. A newly formed group, called the WeWorkers Coalition, speaks on behalf of cleaners and building maintenance workers in the US and Canada who were told that their work would be outsourced from December 9, according to tweets from the coalition .

The cleaning staff and building maintenance staff have been given less than comfortable conditions, the group said on Twitter. Last week, many of these workers were offered the opportunity to work with real estate services company JLL, one of the outsourcing partners, which they must sign by Monday, otherwise they will be involuntarily terminated at WeWork without severance pay, the group said.

Employees will lose their employer contribution of 401,000 because they are laid off before the end of the year, among other concerns, the group said. Those who choose not to accept the offer should, according to the group, be given severance pay as others laid down.

"The WeWorkers Coalition believes that the company does not follow its promise to treat employees with & # 39; dignity and respect & # 39; during this transition process. Our hardworking colleagues deserve better than this," the group in said in a tweet .


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