Peloton employees hit back after layoffs

Peloton is grappling with the fallout from its move to fire 2,800 corporate employees (or 20% of its staff). The fitness brand boomed in the pandemic, but demand for its products have dwindled with the reopening of offices and gyms.

Its CEO John Foley has now stepped down, and former Spotify CFO Barry McCarthy has taken the helm. Shares rose nearly 6% after McCarthy’s appointment was announced, according to Investopedia.

However, on a virtual all-hands call where Foley introduced McCarthy to staff, current and ex-staff took to the chat to criticize the company for the layoffs.

According to CNBC, one worker wrote: “I’m selling all my Peloton apparel to pay my bills!!!”

But when asked if laid-off employees had gained access to the chat, McCarthy responded: “No comment”.

Challenges ahead for Peloton

It is clear that McCarthy is going to face significant challenges around employee morale in the coming months.

In an internal memo to employees published by CNBC, he discussed his plans for Peloton’s comeback story.

He said: “And now that the reset button has been pushed, the challenge ahead of us is this … do we squander the opportunity in front of us or do we engineer the great comeback story of the post-COVID-19 era?.

This may explain why one employee posted during the All Hands: “This is awfully tone-deaf.”

It seems that Peloton employees have not been placated by the company’s offer of cash compensation, equity, and a free year of Peloton membership and health insurance.

Peloton’s next move will be crucial. The ‘Great Resignation’ is real, they don’t want to alienate their existing employees and risk losing even more talent at a time when the business needs good people to help it survive.