Amazon is looking to trim headcount through a voluntary buyout program
The Amazon headquarters sits virtually empty on March 10, 2020 in downtown Seattle, Washington. In response to the coronavirus outbreak, Amazon recommended all employees in its Seattle office to work from home, leaving much of downtown nearly void of people.
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Amazon is offering voluntary buyouts to some employees inside the company, as it looks for ways to trim its headcount beyond the massive layoffs already underway.
“Voluntary severance” offers were sent out Tuesday and Wednesday to some divisions, including human resources and employee services, according to internal company documents viewed by CNBC.
In exchange for leaving the company, Amazon will provide employees with a “lump-sum” severance payment equal to three months of pay, plus one week of salary for every six months of tenure at the company, the documents said. Employees will also be given a weekly stipend for 12 weeks, which can be used to offset COBRA premiums, and their insurance will continue through the end of December.
Employees have until Nov. 29 to resign, and they have until Dec. 5 to withdraw their application if they change their mind, the documents said. Amazon will inform employees next month that their resignation has been accepted, and their last day of employment will be Dec. 23.
The volunteer severance program is a “first step” to realign businesses within Amazon, the documents said, indicating that the divisions could undergo layoffs in the near future.
Amazon is encouraging employees to sign up for buyouts as CEO Andy Jassy steps up efforts to rein in costs across the company.
This week, Amazon commenced what’s expected to be the largest workforce cuts in its 28-year history as it stares down a worsening economy and reckons with a workforce that ballooned during the pandemic.
Amazon’s hardware chief Dave Limp said Wednesday the company began laying off employees in its devices and hardware unit. So far, employees in Amazon’s Alexa and Luna cloud gaming divisions appear to have been significantly impacted by the job cuts.
Amazon is expected to eliminate as many as 10,000 jobs, though the total number remains fluid because the decisions are being made business by business, according to a person familiar with the matter.
The rolling layoff announcements, which are still ongoing, have left some employees inside Amazon frustrated because the company has yet to send out a companywide notice addressing the job cuts, a person familiar with the matter previously told CNBC.