Wayfair opens first permanent brick-and-mortar location in Kentucky.
BOSTON – Niraj Shah, co-founder and CEO of e-commerce retailer Wayfair, said he bears “responsibility” for the 870 employees who were told last week they were losing their jobs.
In an open letter dated Aug. 19 to Wayfair employees, Shah wrote, “I take responsibility for the impact this decision will have on the nearly 900 Wayfairians who will be told today they are no longer a part of building our company’s future. The individuals being impacted have not only made tremendous contributions to the company as colleagues but have enriched us all as our partners and friends.”
Last week, the online home furnishings retailer announced plans to slash its global workforce by 870 employees, or 5% of its global workforce and 10% of its corporate team. In its 2022 proxy statement, the company said it employed 19,402 in its global workforce at the end of Dec. 31, 2021.
In his message published on the Wayfair’s corporate website, Shah outlined the cost-cutting changes the company was embarking upon: thinning management layers; aligning work with strategic priorities; and, adjusting work areas that have grown quicker than the company’s revenue will support.
The letter also gave insight into how the company shared the news with affected employees. Employees in Europe and Asia were told first, and then North American employees, presumably after reading Shah’s letter, received an email telling them whether their role was impacted or not.
Impacted employees were then invited to meet with team leaders to answer questions. Employees staying with the company were told they would hear from directors or vice presidents about team meetings. Shah also referenced an “all company” meeting set for Aug. 31.
In addition, he went into severance packages for employees.
“We are offering severance based on geography, tenure and level, including payout of the 2022 Q1 corporate bonus for those eligible,” he wrote. “For example, in the U.S. we are offering a minimum of 10 weeks pay, as well as continued vesting of existing equity through October. We will also be providing other benefits and resources, including access to Employee Assistance Program resources and outplacement services, and impacted employees will receive individualized follow-up with more detail.”