Published: Tue, November 19, 2019
Markets | By Otis Pena

WeWork Planning to Layoff Thousands of Employees

WeWork Planning to Layoff Thousands of Employees

WeWork received a $US10 billion bailout from Japanese investment firm SoftBank, which took control of the company in October after it failed to go public.

WeWork is preparing to cut at least 4,000 people from its workforce as it tries to stabilize itself after the company's breakneck growth racked up heavy losses and led it to the brink of collapse, two people with knowledge of the matter said.

In the statement published on Sunday, it said that the start-up might lay off almost 2000-2500 employees in the main office space renting business. The source added that around 1,000 maintenance workers will be transferred to an outside contractor and 1,000 employees from noncore businesses will exit the embattled real estate startup. Together, these employees would represent around a third of the 12,500 people WeWork employed at the end of June.

As many as 6,000 employees could be laid off, a source told the Times.

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As part of his separation agreement with the company, Neumann has the right to name both a director and a non-voting observer to WeWork's board while it remains private, Fast Company's Katrina Brooker reported on Monday . However, after investors became nervous about the company's mounting losses, the IPO was shelved and WeWork's CEO Adam Neumann announced his departure from the company.

WeWork rents out workplace areas to start out-ups, freelancers, and enterprises by investing in actual property in a number of the most expensive markets all over the world. Additionally, should the company attempt to go public again, the underwriters of the move could block Neumann from naming additional directors, according to the article.

Online posts by surviving WeWorkers revealed their fears more of them will eventually lose benefits or be forced to work different schedules.

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