Better.com sacks 3000 more in India, US

SoftBank-backed online mortgage start-up Better.com has announced another round of layoffs in the US and India as it looks to reduce workforce amid tepid real estate sales due to rising interest rates. In a dramatic virtual meeting in December last year, it had fired 900 employees.

While the company did not disclose the number of job cuts, several reports peg it at over 3,000. That's nearly half of its overall staff strength of 8,000. It is unclear as to how many employees have been laid of in India.

A emailed query sent to Better.com did not elicit a response at the time of publishing.

The home lending company made headlines when its co-founder and CEO Vishal Garg fired hundreds of employees over a Zoom call just weeks before Christmas in 2021.

The US-based company, which is backed by financial services giants including Citi, American Express and Goldman Sachs, seems to be doing things differently this time.

"We are doing everything possible to personally reach all employees whose jobs will be eliminated to discuss this with them first. Anyone most directly affected by this announcement should receive a call over the coming days from a member of the Better leadership team," Kevin Ryan, chief financial officer and interim president of the firm, says in an email to employees.

"We must take the difficult step of streamlining our operations further and reducing our workforce in both the U.S. and India in a substantial way. We have huge opportunities ahead to grow and to serve, but we must adjust to volatility in the interest rate environment and refinancing market to get there successfully," he added.

The decision to lay off staff is "driven heavily by the headwinds affecting the residential real estate market and is in no way a reflection on the personal performance of any departing team members", the company said. "While it does not make this any easier other companies across the mortgage industry (both old and new) have had to make similar decisions over the last 2 months."

The company said it will provide severance payments to all those who will be laid off. "Affected employees will be eligible for a minimum of 60 working days – and as much as 80 working days – of cash severance payments. We have made sure that this financial support for departing employees is at or beyond what is required by law," it said.

To help ensure continuity of medical benefits, Better said it will extend health insurance coverage in the U.S. for affected employees through the month of March and will then provide three months of continued coverage for which the company will pay the premiums. There was no mention of medical benefits for its employees based in India.

The company has partnered with career transition firm Randstad RiseSmart to help the departing employees find their next jobs.

The start-up said it doesn't expect to enforce existing non-compete provisions for the departing employees. It will, however, shut off their access to internal systems and emails.