Elon Musk and Jason Calacanis messaged about how return-to-office mandates may very well be used as a ‘gents’s layoff’ to get employees to voluntarily give up

Elon Musk’s Twitter acquisition saga could also be exhausting, but it surely has revealed how some enterprise leaders are considering privately about return-to-office mandates.

In messages launched as a part of his courtroom battle with the social media firm, Musk and Jason Calacanis, a self-described “serial entrepreneur [and] angel investor,” mentioned an ulterior motive for return-to-work mandates.

Calacanis mentioned in an change with Musk in April {that a} return-to-office mandate at Twitter—a reversal from the corporate’s present remote-work coverage—may result in 20% of Twitter’s employees voluntarily quitting. He described it as a brand new sort of “gents’s layoff” that has change into widespread within the post-pandemic period, as corporations tighten their belts and look to chop jobs with out paying staff severance.

Many main companies, and notably tech corporations, provide profitable exit packages for employees who’ve been laid off.

In September, Twilio, for instance, supplied the roughly 800 staff it had laid off 12 weeks of severance pay, plus a further week of pay for yearly labored on the firm.

However now, with rates of interest rising and recession fears mounting, many corporations are hoping to slash prices as they downsize their companies. And in keeping with Calacanis, they’re utilizing return-to-office mandates to take action.

That’s not precisely shocking, on condition that some 64% of Individuals would think about discovering a brand new job in the event that they have been required to return to the workplace full-time, in keeping with an April survey by the ADP Analysis Institute.

The Musk-Calacanis direct messages

Calacanis was fast to succeed in out to Musk after the information of his $44 billion Twitter acquisition provide first broke.

The angel investor, an early shareholder in tech corporations Uber and Robinhood, tried to drum up financing to assist Musk with the acquisition, supplied recommendation, and even lobbied to change into Twitter’s CEO.

“Board member, advisor, no matter…you have got my sword,” Calacanis wrote. “Put me within the sport coach! Twitter CEO is my dream job.”

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Calacanis went on to argue that Twitter may meet the requirements of its Huge Tech friends, at the least when it comes to income per worker, if it dramatically lower employees.

In a “again of the envelope” calculation, he mentioned Twitter’s income per worker was simply $625,000 in 2021, in comparison with $1.9 million per worker for Google and $2.37 million per worker for Apple—but when Musk have been to chop 5,000 of Twitter’s 8,000 employees, he may enhance Twitter’s income per worker to a “extra trade customary” $1.66 million.

“Insane potential for enchancment,” Musk responded after emphasizing Calacanis’s textual content.

Then Calacanis proposed utilizing a return-to-office mandate to do away with a few of Twitter’s employees with out having to pay the everyday exit packages. Twitter’s earlier CEO, Jack Dorsey, applied a “endlessly” remote-work coverage in 2020 that permits Twitter staff to work wherever they’re most efficient.

“2 day every week workplace requirement = 20% voluntary departures,” Calacanis wrote. “Day zero…sharpen your blades boys.”

The 2 then determined possibly it wasn’t one of the best thought to debate slashing Twitter’s employees utilizing Twitter direct messages.

“Perhaps we do not discuss Twitter on Twitter,” Calacanis wrote.

“Was simply considering that haha,” Musk replied, including that “nothing mentioned there thus far is something completely different from what I mentioned publicly.”

Regardless of the case, many CEOs have argued that staff ought to return to the workplace after the pandemic as a result of they are saying it improves productiveness and workforce constructing. JPMorgan CEO Jamie Dimon has repeatedly argued that working from house hurts firm tradition, and requested for his staff to return to the workplace, with blended success.

And Wealthy Handler, the CEO of the funding financial institution Jefferies, advised Fortune that workplace interactions may help a person progress of their profession. “In case you are within the workplace, you get pulled into loads of fascinating ‘real-time’ conditions as a result of bodily presence issues,” he mentioned.

Apple CEO Tim Cook dinner additionally mentioned the significance of in-person collaboration in March after saying his plans to implement a hybrid work schedule.

On Friday, Calacanis elaborated on his “gents’s layoff” thought in an episode of the All-In Podcast, with tech investor Chamath Palihapitiya, enterprise capitalist David Sacks, and fellow entrepreneur David Friedberg.

In a dialogue in regards to the latest return-to-office mandates at Apple, Calacanis mentioned:

“As I’ve talked about on earlier episodes, they’ve kinda finished a gents’s layoff. Just like Meta, I believe Apple mentioned you need to be again within the workplace three days every week; a bunch of individuals give up, so that you don’t need to pay them enormous packages once they give up that manner.”

This story was initially featured on Fortune.com

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