The redundancies equate to 13% of Meta’s headcount
Meta has laid off more than 11,000 employees thereby reducing its headcount by around 13 percent, in the most dramatic cull in its history. The social media giant is battling falling revenues and rising competition. Chief Executive Mark Zuckerberg emailed employees on Wednesday morning informing them of the redundancies.
He said: “I want to take accountability for these decisions and for how we got here. I know this is tough for everyone, and I’m especially sorry to those impacted.” Zuckerberg said revenue growth experienced during the pandemic had not been sustained, ad performance was down, and ecommerce had declined, all in an environment of economic downturn.
He added: “[These factors] caused our revenue to be much lower than I’d expected. I got this wrong, and I take responsibility for that.”
Michael McCartney, Employment Partner at Fladgate commented: “Meta’s announcement that it plans to make significant job cuts in response to the current macro-economic environment comes very soon after similar cuts were imposed by Elon Musk following his purchase of Twitter, demonstrating that there is a real impact on advertising revenues in the social media sphere. It would be surprising if either company adopted the approach P&O Ferries deployed recently when it sacked 800 seafarer without prior warning. This is because UK employment law requires an employer to consult with elected representatives (or Trade Unions if there are any recognised) for a minimum period of 30 days, where it envisages 20 or more redundancies and, for at least 45 days, if that number exceeds 100 redundancies. The company is also required to send a notice called an HR1 form to the UK government and if it fails to do this, its directors run the risk of criminal liabilities.
Social media firms (even more so than a travel company) are bound to be conscious of the negative publicity for any failure to comply with employment laws even if the financial penalty (which amounts to 13 weeks’ pay per employee) alone is not enough of a disincentive.”
Florence Brocklesby, Founder of Employment Law Specialists Bellevue Law also commented: “Redundancies are, sadly, a fact of life, and delivering difficult news is never easy. But how a restructuring is conducted is hugely important, not only for those leaving the business, but also for those who remain and the company’s wider reputation. Good processes combined with humanity are key to navigating a challenging time safely and with dignity.
“Twitter’s handling of its current restructuring has shone a light on how redundancies in the tech sector should – and should not – be handled. Just a few days ago Twitter announced plans to let go of 50% of its staff, with swathes of employees finding themselves suddenly locked out of company systems. Meta needs to avoid making those same mistakes today.”