From earnings call - As part of this commitment, the Company is taking steps to streamline the organization, which is expected to result in pre-tax restructuring charges of approximately $400 million to $450 million that will largely be recognized in the third quarter of fiscal year 2024, primarily associated with employee severance costs. Revised guidance will be provided on the conference call.**
What does this translate to roughly? 2000 employees?
Maybe 3,000 laid off from WHQ?… Guess based on 2020.
This is the new norm, 3 year waves.
Where can we find the referenced severance policy - is it available somewhere on the HR site? Also, do we know if the policy changed once we got rid of "VALUES bands" and now this pay grade thing (still don't understand it)
@1zbs+1qbJokWi
This is really helpful. I've been worried I would get like 2 weeks of severance and cut.
@1udh+1qbJokWi Since you're too lazy to research it yourself AND decided being rude was your best action plan, from a previous thread:
Severance depends on your seniority and band level. Look at chart below which is from a severance policy that has been in place for several years. You will also get a PTO payout which is a separate check but no sabbatical payout so make sure you take your sabbatical. Cobra - up to 3 months covered. You can file for unemployment immediately after your last day.
E and above
1 yr (seniority): 8 weeks pay
1 - 2 years: 12 weeks pay
2 - 4 years: 16 weeks pay
4 - 7 years: 20 weeks pay
7 - 10 years: 24 weeks pay
10 years - 15 years: 32 weeks pay
15 years - 20 years: 40 weeks pay
20+ years: 48 weeks pay
L & U
1 yr (seniority): 6 weeks pay
1 - 2 years: 8 weeks pay
2 - 4 years: 12 weeks pay
4 - 7 years: 16 weeks pay
7 - 10 years: 20 weeks pay
10 - 15 years: 24 weeks pay
15 - 20 years: 32 weeks pay
20+ years: 40 weeks pay
V & A
1 yr (seniority): 4 weeks pay
1 - 2 years: 6 weeks pay
2 - 4 years: 8 weeks pay
4 - 7 years: 12 weeks pay
7 - 10 years: 16 weeks pay
10 - 15 years: 20 weeks pay
15 - 20 years: 24 weeks pay
20+ years: 32 weeks pay
Saying folks have been given 2-4 months doesn’t tell us anything. What amount per year of service etc is more helpful. Duh
@1pcy+1qbJokWi. Folks let go over the past 6 weeks have been getting between 2 and 4 months severance.
@1pcy+1qbJokWi
1 year? there's no way. I would love for even just 3 months. I've only been here 3 years though.
Where is the WARN notice?
If the past is any reference 12 months severance whether E,S,VP. I would imagine tenure plays into it somewhere so maybe less for those who are newer. (3mo/6mo) The veterans I knew got the same…12 months (whether they were 15yrs in or 25yrs in) They might go a completely different direction this time. Who knows. This is the phase where speculation will start driving everyone over the edge.
Only thousands, no big deal. Wrong….
Merry Christmas
1500
Whoever said 11,000 is out to lunch. There is about 25k corporate population. Doing that significant of a cut would absolutely hinder any potential of getting out of this rut.
My assumption, around 1,000 globally which would include Director and some senior directors which will big that severance package up higher.
@vxk+1qbJokWi I'll be happy to be wrong. Just hate to see the negative impact corporate greed has on peoples lives. The less people affected the better.
One can't use average salary and 2 month severance to figure out the # of employees impacted. JD specifically mentioned reduction of management layer. VP's make a lot of money and severance usually end up being a lot more than 2 months based on years of services. One VP with 20 years of tenure could have severance cost that's 20+ times that of an individual contributor.
@yxd+1qbJokWi Hahaha. Any leadership roles make WAAAAAAAY more than that! This is laughable.
In 2020, for $250 mil, Nike let go of 700 people. So, probably in the 1100-1400 range this time. Not 14,000.
@zof+1qbJokWi My estimate is based on 2 months severance + 1 week/year of employment. On average it will be 3 months for each person. Average pay is 12k/month. So 36k. So based on 400-450 million, it will be somewhere in 11k to 14k range.
Around 1000 people if I guess. Layoffs su-ks on those who are impacted, but Nike is indeed too bulky, however I doubt they will trim the real redundancy: layers of directors, senior directors, and useless vps, the ones that cost the most and do minimal.
@zof+1qbJokWi It's not about saving $400 mil. It's spending that much on severance.
Approx. $100K for each individual, which translates to 4000 employees
Approx. $40K for each individual translates to 10,000 employees
https://www.oregonlive.com/business/2023/12/nike-seeks-2-billion-in-cost-savings-over-3-years-confirms-significant-layoffs.html
Put it in perspective: 2020 was $250M ish. https://footwearnews.com/business/executive-moves/nike-senior-leadership-team-employee-layoffs-1203027975/
Assume 5% of the total global workforce, possibly including retail staff.
@lpl+1qbJokWi You're saying up to 14,000 of 83,000 employees will be let go? Sounds a bit ridiculous to save $400 - $450 mil.
A recent round of layoffs let under 50 people go and was stated to have saved the org $30 million. (This figure was not just salary but the expenses of a company keeping benefits and support services for employees. Plus they eliminated some projects, which saved $$.)
It's super challenging to reverse engineer the number because severance is highly variable based on employee pay level and tenure. The only thing we can know for sure is that it looks like it will be thousands of employees and it will be soon. Going to be a stressful 45 days and probably the next 6 months since I assume this will be a rolling layoff that will go on for quite a while.
11 to 14k employees will be affected by this layoff.