New-York based mortgage lender Better.com CEO Vishal Garg on Wednesday fired about 9% of his company's workforce on a Zoom call, according to a CNN report. The over 900 employees on the call apparently had no forewarning that they would be terminated just before the holidays.
In the two and half minute call, which was recorded and is now doing the rounds online, Garg said, “I come to you with not great news. The market has changed, as you know, and we have to move with it in order to survive so that hopefully, we can continue to thrive and deliver on our mission. This isn’t news that you’re going to want to hear. But ultimately it was my decision. And I wanted you to hear from me. It’s been a really, really challenging decision to make. This is the second time in my career I’m doing this and I do not do not want to do this. The last time I did it, I cried. This time, I hope to be stronger. We are laying off about 15% of the company for a number of reasons — the market, efficiency and performances and productivity.”
An employee could be heard crying and saying, “This is not real..Oh my god! I can’t believe this…” in the recording.
In the call, Garg said the company was laying off 15% of its workforce, but the company later clarified the layoffs amount to 9% of its workforce. He told the employees that they could expect an email from HR detailing benefits and severance.
Fortune subsequently reported that Garg had publicly accused the hundreds of affected staffers of “stealing” from their colleagues and customers by being unproductive. The accusations came out in a series of messages Garg posted on anonymous professional network Blind days after the layoff. According to him, the firing decisions had been made by reviewing individual employee productivity data.
Among those fired were the diversity, equity and inclusion recruiting team.
The company’s chief financial officer (CFO) Kevin Ryan later told CNN in a statement that the “gut wrenching” decision was taken to keep a focused workforce into a “radically evolving” homeownership market. Based on industry reports from this year, the mortgage industry is overstaffed due to lenders overcompensating for the surge in demand last year - which has not followed through into 2021.