Layoffs at Airbnb: executing workforce reductions with brand and culture integrity
Updated: May 12
When your company’s brand and culture align, the two inform and guide each other. In the case of Airbnb, people and belonging are the cornerstones of the company. Everything they do stems from these foundational principles. It guides how they operate, it informs their marketing, their product, and their employee experience, including how they go about something we all dread — layoffs.
Airbnb recently announced its plans to reduce its workforce by roughly 25% — that’s nearly 1900 people who will be leaving Airbnb as of Monday, May 11, 2020. Airbnb is not the only company that’s been forced to make a similar decision; however, what stands out about Airbnb is the way they are going about it.
Airbnb’s values informed their approach to layoffs
For Airbnb, company values aren’t just words or a poster on a wall: they are true guidelines that shape the way they operate. Since their high-profile rebrand in March 2017, it’s been all about belonging. They take belonging seriously — and it shows in their culture, and in the way they operate their business.
What is belonging? How do you demonstrate belonging when you are about to layoff 25% of your people? In his book The Culture Code, Daniel Coyle breaks down the three basic qualities of belonging cues as:
The energy invested in the exchange
Signaling that the relationship will sustain in the future
Using this framework, let’s take a closer look at how belonging shows up in Airbnb’s way of going about reducing their workforce.
The energy invested in the exchange
In his message, Airbnb’s CEO & Co-founder Brian Chesky goes into a lot of details to describe exactly how the process of making reductions would be carried out, including details on aspects like severance, equity, timeline, expectations.
It’s apparent that the leadership team invested a lot of time and energy to intentionally align themselves on their approach first, and they made clear of this by sharing their process with the world:
- Map all reductions to our future business strategy and the capabilities we will need. - Do as much as we can for those who are impacted. - Be unwavering in our commitment to diversity. - Optimize for 1:1 communication for those impacted. - Wait to communicate any decisions until all details are landed — transparency of only partial information can make matters worse.
Moreover, Brian Chesky goes on to describe even the smallest details, such the email subject individuals will be receiving as a way to manage employee expectations and emotions that naturally come with this type of news.
The leaders at Airbnb decided to include you and me in this process (yes me the author, and you the reader) because they know that we are likely users of their platform and that we belong in the Airbnb community. Airbnb’s decision to publicly declare their approach allowed everyone who is impacted to understand exactly how and why the decisions were made. They value us as individuals.
And when it comes to how they value their employees, the letter makes it apparent that the organization has its people at heart. Here are two examples of how it shows:
1. They allowed their people to say goodbye
Airbnb understands that allowing people to stay for a little longer allows everyone to process the changes:
The final working day for departing employees based in the US and Canada will be Monday, May 11. We felt Monday would give people time to begin taking next steps and say goodbye — we understand and respect how important this is.
What speaks volumes is that Airbnb is intentional about the trust that they put in their people — a lot of companies who terminate employees choose to walk them out with security as soon as they’re terminated — regardless of the reasons.
2. They created a support system
Rallying employees to help those departing isn’t just a humane to do — it’s also the right thing to do for business performance. Those who stay often exhibit survivor guilt, leading to a reduction in performance. For example, in one of his studies, Mark Murphy discovered that 74% of employees who kept their job amidst a corporate layoff say their own productivity has declined since the layoff. Moreover, 69% say the quality of their company’s product or service has declined since the layoffs.
In the case of Airbnb layoffs, they created a multi-layered support system that engages both former and current employees through a multitude of alumni talent programs, like Employee Offered Alumni Support (a program to assist departing teammates to find their next role), Alumni Placement Team (recruitment team to be converted to help place departing employees into new roles) and Alumni Talent Directory.
Signalling that the relationship will sustain in the future
The leadership team went above and beyond to signal that their relationship with the people they are laying off is not over. One example is removing a one-year cliff condition on equity sharing, allowing those hired within a year to leave as shareholders. Another example is how they will be continuing to support the alumni by enabling them to keep their family’s healthcare coverage for 12 months after the term of their employment.
A brand is more than just a logo
Many people think that a company’s brand is its visual identity: colors, logo, swag, marketing, etc. In reality, a company’s brand is broader than this, it shows up in everything that they do. Investing in your brand is investing in the foundation of your company, the one that will inspire your culture and guide you through every decision you will make.
In the case of Airbnb, having people and belonging at the core of the company’s brand guided it to carry out tough decisions without losing brand integrity.