Better.com to lay off more employees—this time not on Zoom
Premium
2 min read . Updated: 09 Mar 2022, 06:33 PM IST Online mortgage lender’s decision comes after CEO was criticized for firing 900 employees over a video call last year
Online mortgage lender Better.com said Tuesday it is laying off more of its workforce, months after the company’s chief executive drew criticism for firing 900 employees over a Zoom call.
The New York-based company plans to let go of 35% of its workforce, which is just over 3,000 employees, according to people familiar with the matter.
“We must take the difficult step of streamlining our operations further and reducing our workforce in both the U.S. and India in a substantial way," Kevin Ryan, chief financial officer and interim president of Better.com, wrote in a letter sent to employees and posted to its website Tuesday.
The layoffs come as a result of headwinds affecting the residential real-estate market, Mr. Ryan said.
Mortgage lenders like Better.com benefited from a wave of home buying and refinancing during the Covid-19 pandemic as interest rates hit historic lows. But volume in certain key segments is getting harder to come by. Interest rates on mortgages are expected to rise this year, and refinancings are expected to plummet across the industry.
Mr. Ryan said in the letter Tuesday that affected Better.com employees would be contacted in the coming days by a member of the company’s leadership team. The company, which is backed by SoftBank Group Corp., will offer a minimum of 60 days severance pay as well as extended medical insurance coverage for U.S. employees, Mr. Ryan said.
“We are doing everything possible to personally reach all employees whose jobs will be eliminated to discuss this with them first," Mr. Ryan said.
Better.com said a small number of employees discovered they were being laid off before being notified by the company. Severance payments appeared either in the employees’ payroll system or their financial institutions, the company said.
“This was certainly not the form of notification that we intended and stemmed from an effort to ensure that impacted employees received severance payments as quickly as possible," the company said.
Vishal Garg, founder and chief executive of Better.com, came under fire in December after a video of him laying off 900 workers on a Zoom call drew criticism online. In the video, Mr. Garg described the difficult decision to fire hundreds of employees due to market changes, calling participants on the Zoom call “part of the unlucky group that is being laid off."
The founder apologized for how he handled the layoffs and took time off between December and January.
“I own the decision to do the layoffs, but in communicating it I blundered the execution," Mr. Garg wrote in a letter posted on Better.com’s website in December. “In doing so, I embarrassed you."
MINT PREMIUM See All
He returned to his job in mid-January. The online lender’s board of directors at the time said Mr. Garg had worked with an executive coach during his break.
Never miss a story! Stay connected and informed with Mint. Download our App Now!!