As Carvana announced on Tuesday, May 10, it was laying off 2,500 of its employees, hundreds of them were informed they were suddenly out of a job over a 5-minute Zoom call.
Carvana, the used car retailer known for its vending machine-like mechanisms found across the United States, said in court filings the layoffs were necessary to “better align staffing and expense levels with sales volumes.”
The company informed shareholders during its quarterly meeting in April that it suffered a $506 million net loss during the first quarter of 2022.
“The first quarter was a challenging quarter for Carvana,” executives said in a letter to shareholders. “While we continued to increase market share rapidly and continued laying the operational, technical, and cultural foundations to buy and sell millions of cars, several external and internal factors impacted our financial results.”
However, employees were informed of the layoffs on Tuesday — the same day Carvana announced it officially bought vehicle auction business ADESA for $2.2 billion.
Zoom layoffs called ‘absolutely unprofessional’
Employees who were a part of the layoffs expressed their frustration and disbelief with Carvana on social media Tuesday. Many said the Zoom call was pre-recorded, but Carvana officials told Protocol the call was live.
“I was part of the 2,500 workers of #Carvana that was laid off. No warning,” one person said on Twitter. “They put us in a Zoom meeting, told us we were let go, ended the Zoom meeting, blocked us from all access to any of our Carvana information. How they did us today was disgusting and highly unorganized.”
At the end of 2021, Carvana had about 21,000 employees, AZ Central reported, meaning about 12% of its workers were affected by the layoffs.
In its statement to Protocol, Carvana said “less than half” of its layoffs were done over Zoom. The rest of the workers were told in person, Carvana said.
But the employees who found out over Zoom they were being laid off recalled the “upsetting” way it was done.
“This company Zoom meeting I was a part of for #carvana was absolutely unprofessional in nature, needless to say upsetting!” one Twitter user said.
One employee, who said she was on maternity leave, learned of the layoffs in a company email. At the time of the email, none of the workers knew specifically who was affected, which she said caused “mass hysteria at 7:30 a.m.” She later learned she was a part of the layoffs.
Another worker shared the contents of the email, and in a 25-post Twitter thread, detailed the mass layoffs and how employees were informed. Employees on the Zoom call were unable to speak or present themselves during the 5-minute long meeting.
“I thought I was with a company that cared about its employees,” the worker said. “Unfortunately, 2,500 of us learned today that big companies will always care about profits over people. They will never care about the families they hurt or screw over, as long as they get to make billions.”
What has Carvana said?
The 2,500 employees who were laid off are eligible to receive “four weeks of pay plus an additional week for every year they have been with Carvana,” the company said in its court filings. They will also be eligible to receive health care coverage extensions.
Carvana’s executive team will forgo its pay for the remainder of the year to help cover the former employees’ severance pay. The company did not state how many of the affected employees work in Arizona, where Carvana’s headquarters are.
“We believe these decisions, while extremely difficult, will result in Carvana restoring a better balance between its sales volumes and staffing levels and facilitate Carvana returning to efficient growth on its mission to change the way people buy and sell cars,” Carvana said.
Carvana also commented on the layoffs in a statement to ABC 15, but did not directly mention the way some were done over Zoom.
“Saying goodbye to any team member is not a decision we take lightly and we aim to be transparent, thoughtful and supportive throughout this process, including providing meaningful assistance, resources and support to impacted team members,” a company spokesperson told ABC 15.
Hundreds join company’s pre-holiday Zoom call — to be told they’ve lost their jobs
