Shopify has announced to sell most of its logistics business to the supply-chain technology company Flexport resulting in a 20 per cent workforce reduction. The decision is believed to impact over 2000 employees in the company.
In a note to employees and shareholders, Tobi Lütke, CEO, Shopify, mentioned that the company will now be smaller as Flexport will soon acquire their logistics business. As a result, some employees would be leaving Shopify that day. He also acknowledged that this was a difficult decision and that he understood the devastating effect it would have on some people.
Employees who are affected by the layoff will receive a severance package that includes at least 16 weeks of pay, as well as an additional week for every year they worked at Shopify. The note also stated that they will also continue to receive medical benefits and have access to employee assistance programs and outplacement services during this time. In addition, impacted employees will be allowed to keep the furniture provided by the company.
The company has asked the impacted employees to return the work laptops as that’s necessary legally, but it will help them buy a new one. Additionally, all the affected employees will continue to have free access to the advanced Shopify plan to help them take their entrepreneurial path in future.
Last year, Shopify announced layoffs in the month of July. The company had fired 10 per cent of its staff, impacting around 1,000 employees across different verticals.
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