Snapchat parent Snap laying off 20% of staff as revenue growth slows

Layoffs continue to batter the North American tech sector. Santa Monica-based Snap Inc., the parent company of Snapchat, confirmed that it is cutting 20 per cent of its workforce as part of a company-wide restructuring.

According to reports, the social media giant’s hardware division as well as its team working to help developers build mini apps and games inside Snapchat and Zenly, the social mapping app that the company bought in 2017, will be affected by the cuts.

In a letter to staff on August 31, 2022, CEO Evan Spiegel said Snap is restructuring around three pillars: community growth, revenue growth, and augmented reality.

“Unfortunately, given our current lower rate of revenue growth, it has become clear that we must reduce our cost structure to avoid incurring significant ongoing losses,” Spiegel said. “While we have built substantial capital reserves, and have made extensive efforts to avoid reductions in the size of our team by reducing spend in other areas, we must now face the consequences of our lower revenue growth and adapt to the market environment.”

The reduction will impact approximately 1,300 workers. The company did not disclose if any employees in Canada are affected.

Snap is the latest in a growing list of North American tech companies to significantly trim its headcount. Shopify, Hootsuite, Article, Unbounce, Clearco, Q4, and Wealthsimple, have axed a substantial number of jobs as they continue to monitor market conditions.

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Termination agreements for Snap employees

In Canada, non-unionized employees and senior executives at Snap are owed full severance pay when they lose their jobs due to downsizing or corporate restructuring.

Severance can be as much as 24 months’ pay, depending on a number of factors.

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WATCH: Employment lawyer Lior Samfiru explains why you are still owed severance if you have been downsized on an episode of the Employment Law Show.

Before you accept any severance offer, have an experienced employment lawyer at Samfiru Tumarkin LLP review it and your employment contract. We can tell you if what you have been provided is fair and how to get proper severance if it falls short of what you are actually owed.

If you don’t receive the full amount (which happens often), you have been wrongfully dismissed and are entitled to compensation.