- Marcelo Claure, chairman of WeWork, said in a statement to Business Insider employees that 13 employees were dismissed for abusing their supplier selection and management processes.
- Claure draws a clear line between how WeWork works in the past and its future under SoftBank and emphasizes that it builds “a strong culture of compliance”.
- He also said that layoffs will be terminated in the next few weeks.
- More stories about WeWork can be found here.
WeWork chairman Marcelo Claure told employees in a statement sent Thursday night that the company had fired 13 people after investigating abuse of policies.
In the memo, Claure said employees from two regions – Latin America and the United States, Canada and Israel that unites the company – were fired for abusing “supplier selection and management processes”.
Read the full memo from Business Insider here.
“When we hear about a problem, you have the assurance that we will investigate it and act on our knowledge,” he wrote. “We corrected these mistakes immediately after hearing the complaint and investigating the incidents, and we know that only when you can express concerns, as our colleagues have recently done, can we build a strong compliance culture.”
Claure also said that layoffs would be over in a few weeks. The office company expects to reduce its workforce by up to 25% as it focuses on profitability. On Thursday, the WeWork boot camp Flatiron School dismissed dozens of employees, Business Insider reported.
A representative of WeWork declined to comment.
“Respect at the core”
WeWork has had issues with employees and suppliers in the past, at least one of which has led to legal action.
On Thursday, Business Insider announced that the company’s IT needs to undergo a major overhaul. At the beginning of WeWork, IT was led by a 16-year-old who had dropped out of high school to join the company. WeWork later sued him for allegations of fraudulent misrepresentation and other allegations in a case where the parties eventually agreed to be released.
In the Thursday statement, Claure appeared to distance the company from its culture, under co-founder Adam Neumann, who was ousted at the end of September.
“We are a culture that believes in making the impossible possible,” he wrote. “I want this culture to continue, but always with integrity and respect – respect for the law, our politics, and most of all, each other.”
Under Neumann, WeWork has grown from an idea to 528 locations and 12,000 employees within nine years. The company also struggled with governance issues and a network of conflicts of interest filed in mid-August to go public. Checking these issues by investors and the media and Neumann’s responsibility eventually led WeWork’s board to oust Neumann, appoint two co-CEOs and involve Claure.
Now the new leadership is anxious to streamline its business and reduce non-core business.
The company announced last month that its WeGrow primary school will close its doors by the end of the school year. Other companies under the banner of The We Company, such as the WeLive living space, have canceled planned projects in response to the turmoil.
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