Another round of layoffs has begun in the technology industry. Fintech company Block, co-founder of Twitter Jack Dorsey, announced new employee terminations. Block provides services such as Cash App and Afterpay. Several months ago, the company had already cut its global workforce by 40%.
The exact number of employees whose positions will be eliminated in this new reduction is not yet known, but it is expected to affect several teams. Employees affected in the US will receive a one-time assistance payment of $5,000, in addition to salary and severance pay.
According to a Business Insider report, information about the new phase of reductions was communicated to employees via internal email. The report states that the company is reducing the number of positions, changing some responsibilities, and making adjustments to the reporting system.
There are concerns that teams such as Customer Operations, Risk Operations, and Learning and Content Operations may be affected. Nevertheless, the actual number of employees involved in the reduction has not yet been disclosed.
It is reported that the main impact of the cuts falls on Cash App, the application that provides financial services to Block's customers. It is also mentioned that some employees of Square, which serves merchants, may be affected.
Block's headquarters are located in Oakland, California, USA. The company also has offices outside America in Canada, the UK, and Australia. The report does not specify which regions will be most affected by the cuts.
Jack Dorsey founded Square in 2009, and in December 2021, the company changed its name to Block. In the same year, in November, Dorsey stepped down as CEO of Twitter, which is now called X. The following year, he also resigned from Twitter's board of directors.
Block offers severance packages to employees affected by the reduction. This package will vary depending on the employee's region of residence. According to the report, employees in the US will receive at least 60 days of salary and at least seven weeks of base pay as severance pay.
Additionally, every employee who worked at Block will receive an extra week of pay for each year of service. Those who sign a separation agreement will receive an additional 30 days of unpaid leave, increasing the total period until severance payment to 90 days. American employees will also receive a one-time assistance payment of $5,000 to support them during the changes. The package also includes three months of Cobra Premium health insurance for affected employees and their registered dependents. Information on severance packages for employees in other regions is not yet clear.
Recently, Canva provided a similar support package after laying off 1,271 employees, which included a free MacBook and LinkedIn Premium.
Several months ago, Block laid off 4,000 people from its staff of 10,000. At that time, Jack Dorsey claimed that the company was not in distress. He attributed these changes to the business transforming through smart technological tools and small, low-level teams.
Later, Block projected that these changes would allow it to save between $800 and $900 million in net annual income. Other companies such as Amazon, Oracle, Meta, Microsoft, Snap, Atlassian, and Coinbase have also announced layoffs. These companies cited cost savings, restructuring, slowing business growth, and the transition to artificial intelligence as reasons.
According to the platform layoffs.fyy, which monitors layoffs, more than 142,000 tech jobs were eliminated in 346 companies this year. The exact number of new layoffs at Block and their impact on various regions has not yet been determined, while a package including salary, severance pay, one-time assistance, and health insurance has been established for US employees.
