Airbnb just laid off 25% of its employees, but it's also paying their health insurance costs for a year, on top of three months' salary

Airbnb just laid off 25% of its employees, but it's also paying their health insurance costs for a year, on top of three months' salary
Mike Cohen/Getty Images for The New York Times

Airbnb announced Tuesday that it's laying off nearly 1,900 employees globally — roughly 25% of the company's workforce — as its business continues to suffer from fallout caused by the coronavirus pandemic.

"While we know Airbnb's business will fully recover, the changes it will undergo are not temporary or short-lived. Because of this, we need to make more fundamental changes to Airbnb by reducing the size of our workforce around a more focused business strategy," CEO Brian Chesky said in an email to employees.

Chesky said that new business strategy guided Airbnb in making cuts, and said that the company will remain committed to diversity, communicating transparently (and one-on-one, when possible), and helping out those let go. That help is substantial, and includes severance pay, healthcare, and assistance finding new work.
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According to the email, outgoing employees will receive 14 weeks of base pay plus an additional week for each year they've been with the company (those outside the US will receive 14 weeks plus tenure increases, depending on local laws). Airbnb is also allowing all employees hired within the past year to become shareholders, dropping a previous one-year tenure requirement before they could receive equity in the company.

Additionally, Airbnb will cover a year of health insurance for US employees through COBRA, a form of coverage provided by companies to former employees, as well as four months of mental health support. Non-US employees will received health coverage through 2020, due to legal restrictions

"In the midst of a global health crisis of unknown duration, we want to limit the burden of healthcare costs," Chesky said.
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Still, former employees will ultimately be looking for new jobs, so Airbnb is taking several steps to make that process easier as well. Those include: setting up an opt-in, public-facing website to showcase their resumes and work samples, reallocating remaining members of its hiring team toward an "alumni placement team," and allowing laid off employees to keep company-issued laptops.

As coronavirus-related layoffs ripple across the economy, Airbnb's approach is uniquely generous. In April, when Airbnb furloughed new hires until late 2021, Business Insider reported that the company would be giving them 10% of their offered annual salary upfront — even if they eventually turn down the job. However, Airbnb also laid off most of its contractor workforce last month as well, and it's not clear which, if any, of those benefits extend to those workers.
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Airbnb had reportedly seen its losses swell to $674 million last year even before the crisis, and business has only plummeted further since. Chesky announced Tuesday that Airbnb's revenue this year will likely be half of the $4.8 billion it earned in 2019. Airbnb raised $2 billion in debt and equity in April as it tries to buy some runway to ride things out, but some outside investors already slashed their valuations of Airbnb.

Read the original article on Business Insider
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