Elon Musk and Jason Calacanis’s messages reveal how return-to-office mandates can be utilized to get staff to give up

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 trade 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 grow to be frequent within the post-pandemic period, as firms tighten their belts and look to chop jobs with out paying staff severance.

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

In September, Twilio, for instance, provided 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 firms are hoping to slash prices as they downsize their companies. And in line with Calacanis, they’re utilizing return-to-office mandates to take action.

That’s not precisely shocking, on condition that some 64% of People would take into account discovering a brand new job in the event that they had been required to return to the workplace full-time, in line with an April survey by the ADP Analysis Institute.

The Musk-Calacanis direct messages

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

The angel investor, an early shareholder in tech firms Uber and Robinhood, tried to drum up financing to assist Musk with the acquisition, provided recommendation, and even lobbied to grow to be Twitter’s CEO.

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

Calacanis went on to argue that Twitter may meet the requirements of its Massive Tech friends, no less than when it comes to income per worker, if it dramatically minimize 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 had been to chop 5,000 of Twitter’s 8,000 staff, he may enhance Twitter’s income per worker to a “extra trade normal” $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 eliminate a few of Twitter’s employees with out having to pay the standard exit packages. Twitter’s earlier CEO, Jack Dorsey, carried out a “eternally” remote-work coverage in 2020 that permits Twitter staff to work wherever they’re most efficient.

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

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

“Possibly we don’t discuss Twitter on Twitter,” Calacanis wrote.

“Was simply pondering that haha,” Musk replied, including that “nothing mentioned there thus far is something totally 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 residence hurts firm tradition, and requested for his staff to return to the workplace, with combined success.

And Wealthy Handler, the CEO of the funding financial institution Jefferies, advised Fortune that workplace interactions will help a person progress of their profession. “In case you are within the workplace, you get pulled into lots of attention-grabbing ‘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” concept 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 concerning the latest return-to-office mandates at Apple, Calacanis mentioned:

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

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