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Comment by 11thEarlOfMar | Hacker News Reader

1,200 of 33,000 employees amounts to 3.6% of the work force. This level of action, 1 in 25 employees, gives managers an opportunity to release employees that looked good in the interview but did not meet expectations. Whether Tesla conducted this in a proper manner is open to debate and perhaps details will emerge if/when any former employees pursue Tesla in court. But any company needs to address the inevitable hiring mistakes and I don't see evidence that Tesla is doing any more than that.

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> I don't see evidence that Tesla is doing any more than that

If the lack of promised performance reviews is accurate, that's the obvious issue - it implies a labor force decision disguised as a performance decision. This is a pretty common move in e.g. game development, so it certainly isn't unthinkable.

The point about total workforce size is well taken, though; this still seems like it could be as simple as "times are tough so we're cutting more stringently than we might otherwise".

Then the WARN act applies

Would you say 3,6 % is that stringent though? I remember GE under Welch fired 10 % of the lowest performers every year, that seemed kind of stringent. But Tesla is fast-hiring and acquiring, so seem to have a larger need to fix hiring-errors than GE. At the end of 2015 they had only 14,000 employees! In light of that, 3,6 % seems completely reasonable to me. Low, even.

Concerning the performance review: would expect that after acquisition, SolarCity would adjust to Tesla's performance standards. So even if they were based on prior performance reviews, still seems like a reasonable action and level to me.

As much as I try to squint, I'm having troubles seeing the smoking gun here.

> Welch has said his first rule of firing an employee as a manager is to avoid any element of surprise. Your workplace ought to be built on constructive criticism and feedback.

> Expectations should be so clear that anyone in the aforementioned bottom tenth of your firm knows they'll be there before the ranking and yanking starts. "Anybody who is fired and surprised? That's the bosses' fault," Welch said on Bloomberg TV in 2015.

Contrast the GE description to what happened here with Tesla: absolute blindsiding where the employees were not given any performance feedback before getting axed.

https://www.thestreet.com/story/14315785/1/how-to-fire-peopl...

When MS fired people for performance every year people hated them for it, and their culture was considered notoriously awful.

They had stack rankings. Fire one guy per department even if everyone is ok.

Any signs this is what tesla did? Lowest 2% is fine. Lowest 2% per team is not fine, means you need a scape goat for each team.

I thought the concensus now was that Welch's leadership under GE was not good.

There's been a lot of rants about the utility of stack ranking and this sort of "fire the worst performers because everyone else is better" attitude. Namely wrong incentives.

You have John Carmack and a clone of John Carmack working on your game engine. You have stack ranking. Which one should you let go during review season? Should you hire some extra people to protect your good people?

That worked at GE largely because they were getting rid of the gold watch retirement crowd. That worked in the past as companies had people who worked there all life, and most of the time late in career they would come to work, do nothing all day and go home.

Jack Welch was simply doing long pending layoffs.

That worked at GE largely because they were getting rid of the gold watch retirement crowd

You mean, getting rid of people who had been promised deferred compensation, before having to make good on it? That was the deal with old-skool companies, remain loyal for 30 years then ease your way into retirement. GE got the loyalty then shafted those guys.

The economic set ups across the world changed. You can't fault companies for doing what was needed.

In India many old people got shafted both the ways being asked to take voluntary retirements and being subjected to high inflation rates at the same time.

You can't fault companies for doing what was needed.

Well, you can, or no obligation means anything anymore. Why should a company even pay you your wages if things are a little tight this month, by that logic?

Salary is an obligation in return for your services. The company doesn't owe a person a job for passing time at office.

Its just people woke up to the fact that socialism wasn't a feasible model anymore.

OK, a company decides it won't pay your pension anymore then - identical scenario.

Its not an identical scenario. Companies don't pay pensions in most countries. These largely get paid through Pension funds, which by and large investment money in Government backed securities.

These are debt obligations at the level of a country. On 'your' investments.

This is totally different than saying a person should be given a job, even if they don't work.

Companies don't pay pensions in most countries

Ummm airlines and automakers in the US do, or did. Lots of companies/countries are the same.

That isn't what happened though. You are just assuming they might have fired the bottom. If they did, that might be reasonable.

I'm not able to provide evidence, so my assertion that their firings were a lot of bullshit isn't going to carry much weight. I'm ok with that. But likewise, you might want to consider waiting for evidence that they did in fact cut underperformers, because I don't think you will see that either.

Although I agree with you, you are also making an assumption that certain managers are not hiring mistakes as well. Managers can be just as bad as employees. Especially in a big company, bad managers can hide behind smoke screens by shifting the blame on employees.

Do we know there aren't any managers leaving? Where I work when they do this sort of thing only the very top layers of management are secure.

I think the assumption there was more that, for the purposes of that sentence, all employees are workers. Managers are just employees that are assigned to manage people.

Indeed. Calling 3.6% a "mass firing" to me looks like pushing a narrative.

https://en.wikipedia.org/wiki/Layoff

> "Mass layoff" is defined by the United States Department of Labor as 50 or more workers laid off from the same company around the same time.

That's a pretty inaccurate way set point a term.

In SolarCity case, that means 0.15% of their workforce.

Its what the law calls it and with my Industrial Relations / HR hat on firing > 50 at one time is redundancy / layoffs.

firing an entire team of 10 or so for malfeasance I could buy - btw collective punishment of employees is allowed under common law

By that definition, they could lay off only 0.15% of their workforce and still qualify. Likewise, bigger companies are probably in a perpetual state of "mass layoff."

Context is important, though. The term can be simultaneously technically correct in the context of US Department of Labor terminology and misleading to a general audience. I think that is happening here.

If the layoff is part of one event, then why shouldn't it qualify?

Your "bigger company" example is just an example of scale, there's just lots of individual events.

Instead, here is SolarCity firing 1,200 employees on the same day and saying that it's all just coincidence on their individual performances, not a unified decision.

> If the layoff is part of one event, then why shouldn't it qualify?

It does qualify. My argument is that the statement out of context is misleading.

> Your "bigger company" example is just an example of scale, there's just lots of individual events.

Yes. It's an example of how using the term "mass firing" to describe "any 50 employees of a company being terminated around the same time" as the headline has done is misleading.

> Instead, here is SolarCity firing 1,200 employees on the same day and saying that it's all just coincidence on their individual performances, not a unified decision.

No, former employees estimate Tesla is firing a total of 1,200 employees, some of which are SolarCity employees. And there was no statement it was a coincidence or not part of a coordinated effort (of course it was). That's not mutually exclusive with legitimately culling your low performers.

Is there a difference in this case between "laid off" and "fired"?

"Fired" generally means terminated for cause, though not exclusively so. "Laid off" implies a general workforce reduction, and maybe some severance payment, job placement help, etc.

Either way you're out of a job, so in that sense there's not much difference.

Depending on the country/state laid off and fired be very different legally.

Laid off generally comes with a severance package that is consistent across the laid-off employees. The reason for the employee termination is (at least outwardly) the companies fault due to the company not having a use for that subset of employees - department closure, cashflow, product cancellation etc. In the UK a company must announce it is going to go through a lay-off some weeks before actually terminating employment contracts.

Firing someone puts the 'blame' on the employee. Generally the company has to document the reason for firing the employee. Even in places with 'at will' employment law a company will want documentation in place in order to defend against wrongful termination or discrimination claims.

Companies will often offer some cash sweetener to a fired employee in return for them signing a termination contract that makes future legal claims more difficult (or costly).

Might be a narrative. One reason would be to push the stock price down. Currently down to 330 from 360 a month ago. Could be a good time to buy if you're long.

> 1,200 of 33,000 employees amounts to 3.6% of the work force. This level of action, 1 in 25 employees, gives managers an opportunity to release employees that looked good in the interview but did not meet expectations.

That level of "firing" is rather suspect for an "new" company that is supposed to be growing.

> But any company needs to address the inevitable hiring mistakes and I don't see evidence that Tesla is doing any more than that.

If you are making that level of mistake where you have to conduct mass layoffs, then it doesn't bode well for tesla.

It's so easy to hire bad apples. I've been through three rounds of layoffs at two separate companies: each time most of the people who were let go were poor performers, they either were bad salespeople or bad coders. The other ones were just lazy, working only 9-5, and taking frequent time off for silly reasons like "my rabbit is sick." As long as you're cutting less than 10% of staff you're cutting fat, not muscle (though you might hit a small amount of muscle by accident).

> The other ones were just lazy, working only 9-5

I completely understand the latter issue about taking off randomly for wild reasons, but why is working agreed-upon hours a bad thing?

Because the code-slaves should work harder and give at least 80hrs a week!

No, but seriously, if a job is asking more than 9 to 5, they're asking you to put out sub-standard work while stealing your time needlessly.

So many people here forget 12 hours pay for an 8 hour day was a rallying cry for organized labor at one point, and that all these terrible labor practices that seem common at smaller tech firms (and Tesla) are very bad and create bugs, sickly workers and hurt everyone involved. Not that management is smart enough to realize that!

If you're an exempt employee (you're exempt if you're not an hourly employee or making over ~$23,000 USD in the USA), means that you're not qualified for overtime. When other team members are putting in over time, but a few people aren't they're effectively freeloading on the people putting in more effort.

If there's more work to do than what the current employee set can do in 40 hrs/wk, then the team didn't hire enough employees. I realize that rare is the team that is fully staffed, but the employee shouldn't be obliged to make up the delta because management didn't hire appropriately.

So , the company tries to extract free labor but the person who doesn’t let them get away with it is the person you blame???

I don't see how it's free labor. I'm not sure if you're European or American, but in the U.S. most professional jobs don't have set hours, it's more you work until the task is satisfactorly completed within defined time constraints.

I'm American but I have luxury of working as a consultant - I get paid for every hour. I've worked for lots of companies and without exception, I've really like working for the company and when there was an occasional push, worked some extra hours. That said, I'd take some comp time later.

"in the U.S. most professional jobs don't have set hours, it's more you work until the task is satisfactorly completed within defined time constraints."

Then the company won't mind if I leave early when I have my work done right? Oh, you mean this relationship with the company is only supposed to go one way - to the company's benefit?

[Twirling my mustache] Wouldn't it be great if we could convince an employee (that we are exploiting) that the reason he has to work late is because another employee didn't donate labor to the company (and not that the deadlines are unrealistic)?

I think employers and employees sometimes forget that this is a value for value, business relationship. Think of what's implied in the common phrase "I gave him a job." An employer doesn't "give" someone a paycheck anymore than an employee gives the employer his labor - it a value for value trade.

No, the company is the freeloader in this case. I don't know where you get this whole idea of no set hours. Salaries are based on the expectation of 40 hours a week. If a company is asking for more than that on a regular basis, that company has some significant issues that need to be addressed. Workers who are not willing to be taken advantage of should not have to suffer consequences for their employers mismanagement.

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