Shopify employees were once known for their loyalty and reverence for the company, but that was before people started getting fired.
What happened: Shopify is facing a class action lawsuit that alleges the company dialled back on hefty severance sums offered to laid-off employees. Shopify says the offers were miscalculated, but ex-employees are asking for a $130 million apology, per the Canadian Press.
It’s estimated that ~2,300 people were affected by Shopify’s cuts last month, or ~20% of the workforce. The company previously reduced its headcount by 10% last year,
The class action’s plaintiff says his severance offer was cut in half, from $88,000 to $44,000. He claims he was told he’d have to settle for $36,000 if he didn't accept it. He says other employees were offered between $10,000 and $60,000 less than they had initially accepted.
- “I review severance packages every day and have 21 years of doing this and I have never seen any employer ever do anything like that,” one lawyer told the CP.
Why it matters: It’s a sign of how times have changed in tech, and workers—once promised the moon in exchange for being a part of the next big thing—now find themselves in a much more adversarial relationship with their employers.
Zoom out: That said, the severance sums offered across the tech sector have been well above what the law guarantees. Ex-employees from Shopify, Microsoft, Meta, Amazon, and Salesforce were promised between 2-4 months, with more added for years of service.—SB