Advertisers Flee As Twitter Lays Off Nearly Half Of Its Workforce

The news that a reported 3,700 TwitterTWTR
employees were let go via email, was no surprise. However, it does call into question how badly advertising revenue will be hit as ad agencies try and figure out what the new Twitter will look like sans almost half of their employees.

Employees likely didn’t sleep well after getting an email on Thursday night telling them they would be notified what their future employment status was by 9:00 a.m. PST on Friday by email with the header “Your Role At Twitter.” It would be sent to their personal accounts if they are being let go, or to their work accounts if they would be staying, they were notified in an unsigned email.

The company shut all offices on Friday “to help ensure the safety of each employee as well as Twitter systems and customer data.” Some employees who had been sleeping in their offices due to heavy time demands from Musk were shocked as they were escorted out of the building.

Many employees got early warnings as their access to work platforms was shut off at about 8:00 p.m. and their email accounts were turned off at 11:00 p.m. “It’s a break-up by text,” a person affected by the layoffs said.

“My entire team is gone,” one person impacted by the layoffs in New York told a reporter. They worked on a team of more than 30. Another employee estimated that 90% of their team was gone.

Most of the management of the ad sales team, including Chief Marketing Officer Leslie Berland, VP of Global Client Solutions Jean-Phillipe Maheu and Chief Customer Officer Sarah Personette, had already been let go by Chief Twit Elon Musk, who has been trying to placate advertisers by doing in-person and video meetings.

Three of the worst hit teams were product and engineering for advertising, Redbird (the infrastructure team that runs data centers), and corporate communications.

Musk’s strategy to butter up advertisers has clearly not worked. General MillsGIS
Inc., snack food manufacturer Mondalez International Inc., PfizerPFE
Inc. and Volkswagen AG’s Audi are joining a growing list of companies “pausing” campaigns on Twitter, according to The Wall Street Journal.

One ad agency executive told The Journal that about 20 of its clients are no longer advertising on Twitter, and that’s just one agency. Musk himself gave a clue as to how bad things are when he tweeted that the company has had a massive drop in ad revenue since he acquired it a week ago. He said it was “due to activist groups pressuring advertisers, even though nothing has changed with content moderation and we did everything we could to appease the activists.” He added, “Extremely messed up! They’re trying to destroy free speech in America.”

What he failed to consider is the fact that, like stock market investors, the thing that advertisers like the least is uncertainty. If they don’t know exactly where and when their ad is being placed, and more importantly, what the demographic will be, they will simply stop their campaigns.

Another issue is the mood of the remaining employees given Musk has no hesitancy in quickly letting people go if they don’t carry out his vision. Many employees being laid off under the plan which has been dubbed “Project Tundra,” are being given only 60 days of severance pay. Twitter Chief Accounting Officer Robert Kaiden left the company after the list of layoffs was solidified, one of the last remaining Twitter execs to leave the company.

Musk may in fact be losing even more employees than those he has laid off. Morale is likely to plummet with the massive layoffs paired with the fact that everyone working at home is being required to return to the office. Axios reports that employees are being given as little as 60 days to relocate to a Twitter office.

This is a complete reversal of company policy that employees can work remotely on a permanent basis, and many took this opportunity to move somewhere cheaper and are unlikely to sell their homes and try and relocate to a much more expensive location such as San Francisco.

Surprisingly, Twitter did not take down a flurry of tweets from prominent California Attorney Lisa Bloom (@LisaBloom) late Thursday night including:

· Hey Twitter employees getting laid off tomorrow! IMPORTANT INFO from a CA employment attorney (me): CA’s “WARN” law requires Twitter to give you 60 days notice of a massive layoffs. A layoff of 50+ employees within a 30 day period qualifies. I know you didn’t get that notice;

· This WARN law applies to all California employers of 75+ employees, which obviously includes Twitter with its thousands of employees. Purpose of the law is to give laid off employee’s time to figure out how to handle this disruption. And Elon completely ignores it;

· Twitter will be liable for all of these (civil penalties, lost compensation, lost medical and other benefits) & attorney’s fees for 60 days it failed to give workers notice. This flagrant violation of worker’s rights is outrageous. Who’s in for a class action? LET’S DO THIS;

· Also, CA’s strong antidiscrimination laws apply to Twitter’s big layoff tomorrow. Are people of color, women and/or older workers disproportionately chosen for example? This was done so hastily, so slapdash, so that the world’s richest man gen get even richer faster;

· Employees laid off in violation of the WARN Act receive back pay at the employee’s final rate or a 3 year average of compensation, whichever is higher. Twitter would also be liable for workers’ medical expenses that would have been covered under an employee benefit plan;

· Twitter employees, DO NOT SIGNIGN
ANYTHING when you’re laid off. Consult with an attorney first. Buried in the fine print may be a waiver of your rights under CA and Federal law. Those employers like Twitter who violate the WARN Act face civil penalties of $500/day for each violation. With thousands of employees this could be significant, though maybe not to Elon; and

· We’ll see how long Twitter lets my posts stay up. If they take them down tonight, before the layoffs, that means they were on notice of the law I cite and chose to punish me rather than follow it. That’s consciousness of guilt and I’d use it as the basis for punitive damages.

A class action lawsuit was indeed filed against Twitter for not giving enough notice to employees prior to the layoffs by Shannon Liss-Riordan, who unsuccessfully sued Tesla in June of 2022 when the company cut about 10% of their workforce.

However, Musk apparently has already thought this through by keeping people on the payroll who are laid off. The New York Times received an email from a worker who was notified that her job had been “impacted” but that they would stay employed through a separation date in February.

“During this time, you will be on a Non-Working Notice period and your access to Twitter systems will be deactivated,” read the email, which was signed “Twitter.”