Better.com, the embattled online-mortgage lending company that fired around 900 employees over a Zoom call in December 2021, on Tuesday (March 8) announced that it is laying off over 3,000 more employees.
The company said it's taking the difficult step of streamlining its operations and reducing workforce in both the United States and India in a substantial way"
In a letter posted on company website on Tuesday, Better.com's interim president Kevin Ryan said the layoffs were prompted by a "dramatic drop in origination volume due to rising interest rates".
"Unfortunately, that means we must take the difficult step of streamlining our operations further and reducing our workforce in both the US and India in a substantial way," Ryan said.
"This decision is driven heavily by the headwinds affecting the residential real estate market," Kevin Ryan added.
The "affected employees will be eligible for a minimum of 60 working days, and as much as 80 working days, of cash severance payments", news agency Reuters quoted Better.com's interim chief.
They will also be eligible for extended medical benefits, severance and a "suite of services" to help them find a new job, CNN reported on Wednesday (March 9).
Meanwhile, the online-mortgage lending company, Better.com, also made headlines in December 2021 when a video showed its CEO Vishal Garg firing 900 employees from his company over a Zoom call.
Garg held a video call in which he laid off 9% of Better's workforce. "If you're on this call, you are part of the unlucky group that is being laid off," Garg said. "Your employment here is terminated, effective immediately."
Garg briefly stepped aside from his position, but returned to it in January.
Better.com was once valued as high as $6.9 billion. The company ranked No. 1 on LinkedIn's Top Startups list in 2020 and 2021. The Softbank-backed mortgage lender has been trying to go public, although those plans have been postponed due to the fallout from Garg's handling of the December layoffs, according to Bloomberg.
As the video went viral, Vishal Garg apologised for his manner of handling layoffs at the mortgage company. Later, he decided to take time off from the company while it conducts a "leadership and cultural assessment".
"Potentially" avoiding another public relations disaster like the one that followed CEO Vishal Garg's decision to conduct a mass firing over Zoom, Better.com said that affected employees will be notified personally over the phone, CNN reported.
However, some workers were unintentionally notified of their firing after seeing a severance payment in Better's internal payroll system or in their bank accounts prior to the official announcement, several reports said.