Being fired on a Zoom call before Christmas

“If you are on this call, you are part of the unfortunate group that will be fired. Your employment here ended effective immediately.”

With these words Vishal Garg, CEO and founder of Better.com, announced just before the Christmas holidays the dismissal of about 9% of the company’s employees during a webinar on Zoom.

Of the 900 laid offs, the entire diversity, equity and inclusion recruiting team has been disrupted and completely dismembered.

The reasons behind such abrupt decision would be related to poor performance and low productivity of the workforce, as well as the need to adapt to changes in the market in order to continue to survive and prosper in the online mortgage sector.

“Having to conduct layoffs is heartbreaking, especially at this time of year”, said the CFO of the company, Kevin Ryan. “However, a strong balance sheet and a small and concentrated workforce together allowed us to play the attack by entering a radically evolving market of the property houses”.

After the firing, Fortune magazine claimed that Mr. Garg was also the author of an anonymous blog post accusing his company’s fired staff of “stealing” from colleagues and customers by being unproductive and working only two hours a day.

What results from the video call, lasted no more than three minutes and widely criticized on social media, is an obvious problem in the management of people. This, in fact, is not the first time that the CEO of the US company shows such a serious lack of capacity; last year, Forbes received an email from Garg to employees saying: “You are TOO DAMN SLOW. You are a bunch of DUMB DOLPHINS and … DUMB DOLPHINS get caught in nets and eaten by sharks. SO STOP IT. STOP IT. STOP IT RIGHT NOW. YOU ARE EMBARRASSING ME.”

Previously, he had also threatened to set fire to a former business partner and engaged in hostile exchanges with investors, calling one “slurry” and asking him to divest from the company.

Rachel Suff, senior policy advisor for employee relations at the Chartered Institute of Personnel and Development, notes: “Sometimes organizations have to cut jobs, it’s a harsh reality. But how they go about it and the humanity they approach it with can have a fundamental impact on how people deal with that shocking news.”

When such many employees have to be fired, a period of consultation with the workers is needed to prepare them for the news and to understand the reasons behind the choice; it is necessary for the employer to explain that was the last possible alternative: it is about allowing people to leave and restart with the dignity and respect for their person intact.

Ann Francke, chief executive of the Chartered Management Institute, told the BBC: “Bad managers will severely fire people. But the callous way it was conducted was just amplified by this kind of virtual and rather insensitive style. What we know in the pandemic is that empathy is important “.

After the media coverage of what happened, many company executives resigned and Vishal Garg himself took a period of vacation with immediate effect, apologizing for not having shown “the right amount of respect and appreciation” that the situation and the people affected required.

In addition, the US company’s board of directors said they hired an external company to carry out an evaluation and provide recommendations to help them to “build a sustainable and positive long-term culture at Better”.

However, it should be stressed that culture comes from the integrity and character of the person at the top and the most important thing you do as a leader is not to set a strategy or communicate the vision: it is to guide people. Of course, a CEO with thousands of employees can’t drive every employee directly, but he sets the tone with his words and actions.

All of this comes when the company was preparing to go public through a SPAC merger and, at the beginning of this month and after changing the terms of the agreement, it received an early infusion of $ 750 million from the deal with SoftBank and Aurora Acquisition Corp.

Bloomberg notes that the day after the announcement of the new SPAC terms, Garg fired the 900 workers; and, on the one hand, it seems understandable that the CEO of a company preparing to go public takes measures to support the company’s budget and cut unnecessary expenses, including redundancy of unproductive employees but, as has been reiterated, it is not on this aspect that we need to focus our attention.

It will be curious to observe how and if this episode, which highlighted Better.com’s toxic culture in personnel management, will have an impact on its future listing and on a business exclusively aimed at people who are now thinking: “If they deal with their employees in this way, how do they treat their customers? “