Grow your employer brand with layoffs

Rich benefits are not just compassionate — they can strengthen your employer brand

Source: CEO layoff memos analyzed here

With another wave of layoffs under way this month, it’s interesting to read the CEO memos and learn what companies are offering laid off employees.

But first, a lesson from Airbnb.

Airbnb’s 2020 layoffs

Two years ago, Airbnb pulled off a remarkable feat.

In connection with the travel bans at the beginning of the pandemic, the company had to lay off 1,900 employees, about 25% of its staff — this was no doubt crushingly hard for everyone impacted.

And yet, Airbnb’s employee brand seemed unscathed from the cost-cutting, and just two years later they were experiencing record-breaking job applications.

What happened?

Yes, Brian Chesky put on a master class in communication. And the Live and Work Anywhere program rolled out in 2022 contributed to spiking job applications. But also notice the outstanding layoff benefits:

• 14 weeks minimum severance

• 12 months healthcare coverage, including mental health

• Accelerated RSU vesting and eliminated cliff

• Outplacement support

• Keep your laptop

It’s hard to attract and retain the best talent in the world.

Even during belt-tightening, companies like Airbnb leverage great benefits to preserve, or even strengthen, their employer brand.

Layoff benefits trends in 2022

So I thought it would be interesting to see what tech companies are offering severed employees.

I searched for publicly disclosed CEO memos and started tracking them here.

Here’s what I found from Airbnb, Coinbase, Wayfair, Snap, Twilio, Opendoor, Stripe, Shopify, and Lyft:

Severance pay

Severance pay ranges from 10-16 weeks, with nearly every company offering more to longer-tenured employees. Snap offered 16 weeks but didn’t mention more pay for tenured employees, making Shopify the richest benefit overall.

Healthcare

Every CEO memo discussed healthcare coverage (except Twilio), but the range of benefits was wide, from 3 months at Opendoor to 6 months at Lyft and Stripe (Airbnb’s 2020 benefits were even richer at 12 months).

Some companies offered a cash equivalent for premiums, and others continued coverage and offered COBRA in the US.

Mental health

Three companies — Airbnb, Coinbase, and Lyft — called out specifically continuation of mental health benefits. This seems like a very relevant benefit for the challenges laid off employees face, and is probably easy to offer.

PTO payout

Only Stripe called out that they would pay out unused accrued PTO.

Most California-based tech companies use an unlimited PTO accrual approach and may not include this benefit. Many countries have statutory requirements for vacation payouts, and highly-distributed companies might decide to include this benefit for everyone.

Accelerated vesting

Maybe the most interesting trend is accelerated RSU vesting.

Several companies offered this with varying levels of richness. Airbnb and Lyft offered through the end of the month (~3 weeks). Twilio accelerated the next vest, whenever it is. And Stripe accelerated vesting through the last day on payroll (14 weeks).

Additionally, some memos noted they would waive cliff vests for newer tenured employees.

Immigration support

Two companies, Twilio and Stripe, specified that they would provide support to employees on visas. While other companies likely offered this too, I think it’s a smart thing to note explicitly — layoffs put immigrants in a very difficult position.

Outplacement support

Everyone offered this. The trend here is the commitment to create opt-in talent boards to help connect laid off staff to new job opportunities.

Hardware

Nobody said you can keep your laptop like Airbnb did in 2020! I can imagine there are very practical security challenges to put this benefit into practice.

Shopify called out that they need to recover their hardware, but offered an allowance for employees to buy new laptops. And they can keep home office furniture.

I’ll keep an eye out for more CEO memos as layoffs continue, and add what I learn here. Hopefully we won’t see too many more big layoffs this year.

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