The Layoff That Made People Want to Get Fired | Fortune Daily

0:00What if the most important hiring decision that a company makes is how it lays people off? That's counterintuitive, I know. But when Canva recently announced a restructuring affecting over 1 ,200 employees, the reaction was actually applause. Those who were laid off were offered these really incredible severance packages that included at least six months pay, a year of healthcare, $10 ,000 grants to start a new project, and the ability to keep their company laptops to apply for new jobs. a small thing but it actually makes a huge difference. One person online even asked how do you apply to get fired by Canva?

0:42There's a thought. Seven in ten job seekers now use AI to research employers and many of the sources that those chatbots cite are Glassdoor and Indeed reviews, not company career pages. I was really taken aback when I saw the comprehensive packages that Canva was offering to its laid off employees. You don't see a lot of companies doing that in this day and age. And it made me wonder, is it because it's an Australian company? Is it because it's managed by a woman? Is it because it's managed by a millennial woman? Or is it none of the above? It's a millennial woman in Australia. It's all of those things.

1:18I get into all of that with Fortune Editorial Director Kristen Stoller and whether Canva will now become best practice for companies doing rounds of layoffs. From New York, I'm Ellie Austin, and this is Fortune Daily.

1:38Kristen, welcome back. Great to see you again. I mentioned in the introduction that today's not very optimistic topic of discussion, but a very important one is layoffs. And the reason for that is obviously we seem to be in this continually endless cycle of layoffs in the corporate world these days. But very recently, Canva announced, the Australian company Canva, which is known for helping you make your beautiful Instagram slideshows and carousels and many other things, announced it was restructuring 22 % of its workforce. That was actually last week. And I said in the introduction, it received so many accolades for the way in which it approached these layoffs.

2:19Talk to me about what struck you about how they did it and the severance packages that they offered? Yeah, I think, you know, from what I have seen, it is probably the best or the gold standard of what you should do in a layoff. They have, you know, every employee gets healthcare for a year. They get six months severance. They get their laptop. They get to keep the company laptop. So they have something to search for jobs on. And I think the most striking was that you get$10 ,000. You can apply for a grant for$10 ,000. If you have an idea or want to be an entrepreneur and start your own business or want to take something forward.

2:55And no one has done these things. And I think the conversation we're seeing is a lot of people saying like, wow, great for Canva. This is amazing. However, I also think a lot of what I'm seeing is people are like, we are applauding a company for laying people off and for doing the bare minimum of empathy and understanding. So there's a big debate on both sides of this. And so I mentioned in the introduction, this restructuring at Canva is going to affect about 1 ,200 jobs. Not all of those people are going to be laid off. They're going to be offered new roles or moved to new geographies. But put the Canva example next to Microsoft, which 10 days earlier had offered buyouts to 60 ,000 people, which is about 27 % of its workforce.

3:38That's pretty significant. The US minimum at Microsoft for severance is eight weeks compared to Canva's minimum of 26 weeks. What does that tell us? Yeah, I think for me, it says a lot about where these companies are based, right? Canva is an Australian company. Microsoft is U.S. The U.S. does not offer any severance packages required by federal law. So you can be laid off in the U.S. and not get anything. Whereas in Australia, there is a minimum, and I think it depends on your years of service, but you at least have some protections there that you have to give severance. And I think it's a lot about just how we see corporate culture in America versus in other parts of the world.

4:16I know we've talked about in your hometown, the protections for workers are great. Well, and when I came to the US, I couldn't believe that we're doing this thing called working at will, where either you or your employer can decide tomorrow that it's no longer working and you're out the door. Yep. And no severance. No severance. Yeah. So I think it's a lot about the geography and where they're based. And And it's why you're seeing a lot of unions rising here in the U.S., because they want things like severance protection. And how successful are those unions being in campaigning for those protections?

4:45I think, you know, and just looking at it from a media lens, I think it's been really instrumental in people getting severance. I know here in New York, in the landscape we're in, we're seeing severance go from two weeks to maybe even up to four, which doesn't sound that great. But still, you're getting more than what you would have had if you not had these protections. We mentioned, obviously, the geography component of the Canva story, but also Canva is run by Melanie Perkins, who is a millennial woman. She founded the company when she was in her 20s. Is it simplistic to say that women tend to be more empathetic leaders?

5:20They tend to think in a more human way as leaders. Am I wrong or am I right? I think you're totally right. And this may just be our bias as young millennial women, but I feel like if I was in Melanie's shoes and I'm seeing all these companies like Microsoft, like Meta, like Oracle, like all of them laying people off, getting all this blowback. And if you're an empathetic, smart leader, you're seeing it and thinking, OK, how can I do the opposite? Because I think she's very tuned in, very tuned in on culture. And I think being a woman leader certainly helps. AI has been used as a scapegoat in a lot of these layoffs.

5:53Is that actually the truth of what's going on? Are all of these jobs being eradicated by AI or changed by AI? Or is it that layoffs used to be sort of a last-ditch resort, and now they are seen as a tool in a company's toolkit for increasing profit margins, cleaning up the books at the end of the year? I think it's exactly that. And there's a term for it. It's AI washing. And a lot of companies, especially late last year, started doing these layoffs and started blaming AI. And I think it was just a really convenient excuse to be like, we need to clear the books. It's the end of the year. We're not going to make the budget.

6:30And you know what? AI is supposed to replace all these jobs. That's the narrative. Let's go with that. And I actually don't think it's true because a lot of research has come out saying that AI is actually not replacing jobs. It's just augmenting. And a lot of really smart leaders are saying that too. So maybe it's the case for a couple companies, but I don't think that should be the widespread narrative. It's a convenient excuse for others. There's a structural difference in these packages that we're talking about. I mentioned that Microsoft technically isn't laying its people off. It was offering buyouts.

7:04Does a buyout change the narrative and change the story that an employee tells afterwards? They've essentially been given the option to leave the company and receive a good package in exchange. But the same thing is happening at the company. It's a story of kind of reducing the workforce. So how does buyout versus layoff land? That's a good question, because I think it's like buyout makes culture a little better, maybe we could say. Like, you know, my mom took a buyout, and it was right for her because she had two kids, and it was a really exciting thing for her. However, I don't think it eases the fact that like, if you're an employee and you're like, my company has to offer a buyout, we're not in a good place.

7:48And I think, you know, we've talked about this a lot, like one in three employees have said they want to quit, a recent workday study found. And a lot of that is about uncertainty. They're like, what is my company doing? What is the plan? I don't see it. I think buyouts and layoffs all contribute to that. There's some data showing that it takes a very long time for company's culture to recover after a round of layoffs. When you speak to HR leaders for your newsletter, for the Workplace Innovation Summit, what do you hear about the best practices after a round of layoffs? Say they had to happen for whatever reason.

8:20How do you take good care of the people who are left? I think it is exactly what Melanie and Canva are doing. I think it's you want to be super empathetic. You want to help them transition as best as you can. So that's giving them access to health care, giving them really good severance packages, helping them find another job, helping them network. And if these grants are on the table, great. I think doing all that is perfect. I think companies really need to think about it because this is the last impression you're leaving an employee with. And these employees can then go out and say whatever they want about your company.

8:56So do you want it to be a favorable one or do you want it to be negative? Yeah, there's the human element of just, you know, as leaders, you should want to treat your employees well. But then there's also that layoffs are now bizarrely a kind of marketing tool for the company on whether or not it lives the values that it claims to embody. Exactly. Yeah. So you recently spoke to a Glassdoor analyst, and he made a very similar point. He said that offboarding, to use that very corporate jargon term, matters because departing employees really shape the narrative of your company. Is that how HR and companies are thinking internally right now?

9:31Or is that maybe a bit ahead of the curve? I think where HR leaders are really scared right now is they know that AI is being used. When you and I would look for a job, we could type in, like, tell me, Claude, about what this company culture at X company is like. And that's how most job seekers are getting information. So it will scrape Glassdoor, scrape Indeed, other sites, and give you a summary of what former employees and current employees are saying. Exactly. So I think HR leaders know that's happening, really are terrified of it. But I don't think where HR leads are kind of working to fill that gap is they're not saying, okay, well, how can we change the narrative?

10:09And for years, it's kind of been like they have this beautiful corporate page. It's like, apply here. Here's what it's like to look at this company, work at this company, and here's the benefits you'll get. And no one cares. AI doesn't care. AI won't scrape that. What it cares about is the reviews on Indeed, on Glassdoor, on Reddit, on all of those. And that's where they can't control the narrative as much. So in a way, the corporate world is becoming slightly more democratic because of these platforms and these technological tools. Most companies, sadly, cannot afford six months of severance, cannot emulate the Canva model.

10:44For a company that is going to have to do a round of layoffs and has limited resources, what do you think actually matters most when letting people go? I think it's really the empathetic human part. It's explaining very clearly, here's why we have to do this and expressing remorse, expressing sympathy, expressing some form of we wish it didn't have to come to this. However, here is the financial reality. So I think transparency always helps. It's hard because I really think before a company does this, they need to think about how they can best leave their people. and it's you know i know that they might not have the financial ability but it's i really think you have to make that a priority when you're doing a layoff i mean you and i have both worked in media for a long time and i think we've seen many many rounds of layoffs and once there is a round of layoffs the next question in town halls is always are there going to be more layoffs when are they coming everyone is obviously feeling very insecure about their own jobs and i think you know often corporations aren't in the position to offer the reassurance that people want yes so it's it's sort of providing the best treatment that you can in the interim and showing people that even if you are let go, we're going to treat you decently.

11:54Absolutely. And also telling the employees who are still there, here's our plan, here's how we're going to make it better, and here are our morals and values and beliefs, and here's how they all align. So for anyone who finds themselves in the unfortunate position of being laid off, we don't wish that for anyone, what should you be asking for as you're walking out the door that you might not have thought about? I think the obvious one is getting recommendations. The other - Recommendations from your former - Exactly. From your former employee for anyone. The other thing I would say is I would ask anyone and everyone inside your company, your boss, the CEO, who can they introduce you to to make the next move?

12:36Who can they line you up with? Do they have any friends who are hiring? And really ask that. And if they are decent employers, they should be wanting to help you do that. And then, of course, obviously think about your severance and your benefits and how long the company might help you maintain them for. A hundred percent. And I would say fight and fight aggressively and fight for what you deserve. Kristen, thank you so much. Sadly, a very ubiquitous topic, but you've given us some really important food for thought. Thank you, Ellie. Staying in the unpredictable world of emerging employee trends, it's time to forget quiet quitting and time to say hello to loud working because employees are making sure that everybody hears about their wins, whether that's on Slack or on social media.

13:22And a UK survey suggests it's actually helping some get ahead while quite understandably driving other colleagues out the door. Fortune's resident expert on trends and shifts in the workplace, Oriana Rosa Royal, is here to explain it all. Millennials are self-promoting themselves. It's called loudworking and their colleagues are getting so annoyed they're quitting. Think of that colleague that posts every win on LinkedIn and pings the whole team on Slack the second the task is done. New research from the financial platform Tide found that the average UK worker spends 131 hours a year self-promoting themselves.

14:02That's 17 working days or 2.8 hours a week. And the loudest of all are young workers. In fact, 70 % of 25 to 34 year olds are loud working. They're spending five hours every week making their work visible. And perhaps unsurprisingly, loud working does actually work. According to the research, 77 % of loudworkers have had at least one career opportunity thanks for making their work more visible. This can include new customers, new clients, promotions and even pay rises. Not everyone's cheering. In fact, one in four workers have considered quitting their jobs because of a loudworking culture and one in 10 have already walked out.

14:46Workers in IT, finance and telecoms are most likely to have had enough of loud working and men are more likely to quit over this than women. George Schmidt, the CEO for UK and Europe for Tide, told me that there's a difference between being performative and just backing yourself up and ultimately many workers just want to work at a company that rewards the people doing the hard work, not just the people singing out the loudest about it. That's it for Fortune Daily. I'm Ellie Austin here in New York. what's the most human thing that your human resources team has done lately? Let us know in the comments.

15:23In the meantime, I'm off to loudly work in the Fortune newsroom. We'll see you tomorrow.

15:36We did it. How the hell did we just mud all through that one? That was an improv. Well done.