> Human resources and insurance software startup Zenefits
> has announced that 250 employees are being made redundant,
> representing 17 percent of the company’s workforce.
Before "being made redundant' became empty buzzspeak, it had a very specific meaning: When things are restructured in such a way that two people end up doing the same job, one becomes redundant. For example, if you have an in-house recruiting team, and you become aqui-hired by BigCo, they may decide that all recruiting will be handled by their existing team, and your recruiting team becomes redundant.
Notice that the job to be done is still there, it's just that the company has more people doing it than necessary.
But in this case, the company is laying off a lot of its sales force and recruiting team while mumbling further content-free buzzwords about refocusing its strategy. Meaning, they aren't growing any more, so they won't be selling as much or recruiting as much.
The job to be done is no longer there. Therefore, those aren't redundancies, those are layoffs, pure and simple.
The distinction is important, because "redundancies" can arise as you grow (e.g. acquiring), but "layoffs" imply that the engine is sputtering. Eliminating redundancies is a matter of optimization. Laying people off is a matter of scaling back your ambitions.
The company is obviously trying to spin this, and VentureBeat is regurgitating their press release word-for-word without any editorial oversight whatsoever.
I think "made redundant" has been the British term for laid off for quite a while; though this is, IME, far less common in American usage. I think the distinction you are positing between them could be a good one to make, but I don't think its one that has ever been consistently applied in general usage of the terms in reference to business.
> In this case, the company is laying off a lot of its sales force and recruiting team while mumbling further content-free buzzwords about refocusing its strategy. Meaning, they aren't growing any more, so they won't be selling as much or recruiting as much.
Given that affected parts of the company are those most directly implicated in the regulatory violations that have produced the immediate problems, I wonder if there isn't another level of spin here, and whether this isn't more a set of firings to purge the problem units than a layoff.
Yep. It's a general pattern: any term for "termination of employment" goes through the euphemism treadmill much, much faster than any other word or than we expect it to.
It used to feel like there was a distinction between being laid off (can't afford you anymore, have to scale down) vs being fired (you messed up and they don't want you anymore at any positive price). But gradually I heard "laid off" get used to mean any firing for any reason.
And it makes sense: anyone is going to want to make their termination reason sound better for them, while retaining plausible deniability -- "well, the word is ambiguous anyway". Plus, it's a sensitive topic where people don't want to reveal details of the reasons about third parties. So, expect any term for any termination reason get applied to broader and broader cases, to the point of absurdity.
"He was made redundant after groping the secretary."
"He was retired after they lost their major customer." But he's 35! "So?"
"She was downsized after using illegal accounting practices for the 15th time."
"The junior partner was let go after appearing drunk at a client presentation." (Note:"let go" can be a meaningful distinction in a case where leaving might have major penalties for the leaving employee but the managing partners waive those penalties.)
Not necessarily. It probably means they just overhired, which is a problem at a lot of companies.
They could just plan to get more out of a lower staffing level, this was fairly common in the "re-engineering" triggered layoffs of the early 90s.
My bet is we will see more layoffs like this because managers have erred on the side of overhiring. Now teams are overbuilt and there's no way they need as many employees as they have to achieve their goals.
So they lay them off. We'll be seeing more of this. Management will start erring on the side of cutting staff.
The one constant here is that management is always in error, it's just the direction that has implications for employees.
It doesn't appear (from this article, at least) that the company ever used that word. As far as I can tell it is an editorialization by author of the article.
Not necessarily. If MS decides to build Windows 12 from the ground up they may have a separate team work on Windows 11. After that project is done most of the Windows 11 team would be redundant. Edit: They even did something like this with NT 4.0, ME, and XP.
Similarly, if a catalog transitions to a website once that's done the legacy catalog team could simply be redundant.
> The job to be done is no longer there. Therefore, those aren't redundancies, those are layoffs, pure and simple.
I would presume that there are still sales and recruiting jobs at Zenefits. Maybe "the jobs were made redundant" isn't quite as accurate as "Zenefits realized that the jobs were already redundant."
I don't know if I am alone in this but I have had job offers where the deciding factor on yes/no from my perspective was whether the company uses Zenefits.
Everyone I have spoken to on the subject has at least one horror story, and this was prior to the recent revelations. Add that to the general behavor of the company and the employees. Although the CEO "took the fall" for it, it simply cannot be the case that everyone else is blameless - the culture there is rotten to the core. Andreesen Horowitz, and Lars Dalgaard in particular should shoulder much of the blame for encouraging business practices which are shady at best and downright illegal in all probability.
For the more biz-minded commenters out there: does laying off sales + recruiting signal a specific scenario (other than the obvious recent legal woes)? Rather than laying off engineers?
Zenefits is a classic enterprise sale, meaning you staff the sales team at: # of reps X average quota = expected sales.
The recent problems will hit their sales hard, and leadership knows it. With the growth they've had, there's a chunk of their sales team that's not fully ramped (meaning not producing revenue). Laying off reps + recruiting says they think they can't grow as fast as they previously could.
Not laying off engineers is probably more about how hard it is to hire engineers today, and knowing that when they get past these problems, it'll be easier to re-hire reps than re-hire engineers.
Some possibilities are:
1. They have been trying to automate their sales infrastructure so less staffing needs.
2. Business is down but they feel confident to work on the product development.
This is too bad, I feel sorry for the company in a way. This was a company I kept up with because it was fun seeing their growth.
I didn't see the negative side of the culture until after Conrad stepped down and all hell broke loose.
How does a company, especially a nascent one like Zeenfits, survive in a space when they've suffered this type of hit? An industry all about trust and conservatism and a company playing fast and loose with the rules? Can it work out?
They could survive. My guess is they'll basically focus on retaining as many current customers as possible, get through any investigations about their practices, and hope that once those are finished people will mostly have forgotten about what happened and be willing to give them a chance if their product is on par with others out there.
It irritates me that engineers never get laid off.
This means companies still view their engineering workforces as "scarce" and hard to get, because they aren't paying market wages. Why is it only sales that gets the ax?
The license requirement cheating (in one jurisdiction) and outright selling without a license (in other jurisdictions) were problems occurring in Sales (which may implicate some problems in Recruiting, as well.)
I don't recall any of their problems being traced to engineering. So, while these are for PR purposes styled as redundancies, I think its at least worth considering that it may be more of a purge of the problem parts of the company.
Here is what may be the reasons:
- Because sales team is more easily replaceable than core engineering team.
- There is less any redundancy in engineering team when compared to sales.
- Zenefits is reducing their sales operation.
Why do you assume they aren't getting paid market wages? Your statement, in a way, is contradictory. Engineers are perceived as scarce, but they aren't paid market wages.
Sales has probably gone through the pipeline of customers and engineering is probably still working on building out everything that was promised to customers?
[+] [-] braythwayt|10 years ago|reply
Notice that the job to be done is still there, it's just that the company has more people doing it than necessary.
But in this case, the company is laying off a lot of its sales force and recruiting team while mumbling further content-free buzzwords about refocusing its strategy. Meaning, they aren't growing any more, so they won't be selling as much or recruiting as much.
The job to be done is no longer there. Therefore, those aren't redundancies, those are layoffs, pure and simple.
The distinction is important, because "redundancies" can arise as you grow (e.g. acquiring), but "layoffs" imply that the engine is sputtering. Eliminating redundancies is a matter of optimization. Laying people off is a matter of scaling back your ambitions.
The company is obviously trying to spin this, and VentureBeat is regurgitating their press release word-for-word without any editorial oversight whatsoever.
[+] [-] dragonwriter|10 years ago|reply
> In this case, the company is laying off a lot of its sales force and recruiting team while mumbling further content-free buzzwords about refocusing its strategy. Meaning, they aren't growing any more, so they won't be selling as much or recruiting as much.
Given that affected parts of the company are those most directly implicated in the regulatory violations that have produced the immediate problems, I wonder if there isn't another level of spin here, and whether this isn't more a set of firings to purge the problem units than a layoff.
[+] [-] SilasX|10 years ago|reply
It used to feel like there was a distinction between being laid off (can't afford you anymore, have to scale down) vs being fired (you messed up and they don't want you anymore at any positive price). But gradually I heard "laid off" get used to mean any firing for any reason.
And it makes sense: anyone is going to want to make their termination reason sound better for them, while retaining plausible deniability -- "well, the word is ambiguous anyway". Plus, it's a sensitive topic where people don't want to reveal details of the reasons about third parties. So, expect any term for any termination reason get applied to broader and broader cases, to the point of absurdity.
"He was made redundant after groping the secretary."
"He was retired after they lost their major customer." But he's 35! "So?"
"She was downsized after using illegal accounting practices for the 15th time."
"The junior partner was let go after appearing drunk at a client presentation." (Note:"let go" can be a meaningful distinction in a case where leaving might have major penalties for the leaving employee but the managing partners waive those penalties.)
[+] [-] tryitnow|10 years ago|reply
They could just plan to get more out of a lower staffing level, this was fairly common in the "re-engineering" triggered layoffs of the early 90s.
My bet is we will see more layoffs like this because managers have erred on the side of overhiring. Now teams are overbuilt and there's no way they need as many employees as they have to achieve their goals.
So they lay them off. We'll be seeing more of this. Management will start erring on the side of cutting staff.
The one constant here is that management is always in error, it's just the direction that has implications for employees.
[+] [-] jsprogrammer|10 years ago|reply
[+] [-] Retric|10 years ago|reply
Similarly, if a catalog transitions to a website once that's done the legacy catalog team could simply be redundant.
[+] [-] baddox|10 years ago|reply
I would presume that there are still sales and recruiting jobs at Zenefits. Maybe "the jobs were made redundant" isn't quite as accurate as "Zenefits realized that the jobs were already redundant."
[+] [-] tarr11|10 years ago|reply
Gusto is pushing to switch for benefits management, but it's a bunch of work.
I feel a little gross about staying with zenefits after hearing about their company, but it's mostly free and seems to work.
They are also offering some other services like 401k, shift management and stock options planning.
I'm sure at some point I'll consolidate on one of these platforms, but right now they don't seem stable.
[+] [-] taway_20160226|10 years ago|reply
Everyone I have spoken to on the subject has at least one horror story, and this was prior to the recent revelations. Add that to the general behavor of the company and the employees. Although the CEO "took the fall" for it, it simply cannot be the case that everyone else is blameless - the culture there is rotten to the core. Andreesen Horowitz, and Lars Dalgaard in particular should shoulder much of the blame for encouraging business practices which are shady at best and downright illegal in all probability.
[+] [-] kylestlb|10 years ago|reply
For the more biz-minded commenters out there: does laying off sales + recruiting signal a specific scenario (other than the obvious recent legal woes)? Rather than laying off engineers?
[+] [-] trjordan|10 years ago|reply
The recent problems will hit their sales hard, and leadership knows it. With the growth they've had, there's a chunk of their sales team that's not fully ramped (meaning not producing revenue). Laying off reps + recruiting says they think they can't grow as fast as they previously could.
Not laying off engineers is probably more about how hard it is to hire engineers today, and knowing that when they get past these problems, it'll be easier to re-hire reps than re-hire engineers.
[+] [-] pkaye|10 years ago|reply
[+] [-] justinzollars|10 years ago|reply
[+] [-] stygiansonic|10 years ago|reply
[+] [-] w1ntermute|10 years ago|reply
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[+] [-] erichurkman|10 years ago|reply
[+] [-] jeffehobbs|10 years ago|reply
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[+] [-] Scalability|10 years ago|reply
[+] [-] eldavido|10 years ago|reply
This means companies still view their engineering workforces as "scarce" and hard to get, because they aren't paying market wages. Why is it only sales that gets the ax?
[+] [-] dragonwriter|10 years ago|reply
I don't recall any of their problems being traced to engineering. So, while these are for PR purposes styled as redundancies, I think its at least worth considering that it may be more of a purge of the problem parts of the company.
[+] [-] asadlionpk|10 years ago|reply
[+] [-] mwnz|10 years ago|reply
[+] [-] jsprogrammer|10 years ago|reply
[+] [-] aliston|10 years ago|reply