'You deserved better' | Virgin Orbit exec slams bankrupt firm's leaders in farewell to staff

Virgin Orbit exec slams bankrupt firm's leaders in farewell to staff

One of Virgin Orbit’s outgoing executives has hit out at the firm’s leadership, saying employees “deserved better” after the company declared bankruptcy...

In a farewell email to employees, Chief Operating Officer Tony Gingiss apologised to workers while criticising the firm’s senior figures for apparently not addressing the workforce at the critical moment.

The satellite launch company, founded by billionaire Richard Branson, went bust after struggling to secure long-term funding following a failed launch in January.

It also announced the lay off of roughly 85% of its 750 employees. Among those departing the business was COO Tony Gingiss who, in his goodbye message - acquired by CNBC -  told employees they “deserved better than this!"

“I want to say something to you, that you have not heard from the person who should be saying it, so I will” wrote Gingiss, in an apparent swipe at Chief Executive Dan Hart.

"You simply did not have the leadership or opportunity to demonstrate to the world what you can fully do and how this product could be an enduring force in the market”, Gingiss wrote, adding: "I'm sorry that I was not able to convince our leader and board to take a different path to give us more time to figure things out.”

Outlining some of the issues he was remorseful for, Gingiss said:

  • I’m sorry that I was not able to help us avoid this outcome

  • I’m sorry we didn’t act sooner and avoid surprising you and so many of our supporters and customers with this abrupt finale

  • I’m sorry that we didn’t prioritize our people and financial resources better

  • I’m sorry that you have to bear the burden of being out of a job, one that I know many of you loved and that fed you both literally and figuratively

  • And for me, I’m sorry that I was not able to convince our leader and board to take a different path to give us more time to figure things out

  • I’m sorry and I apologize, plain and simple … you deserved better!

“We ended up where we are despite my best efforts to affect our path forward.”

More employees pay the price for firms’ grand plans

So, Gingiss admitted Virgin Orbit’s finances and decision making should have been handled better.

Sound familiar? Well, recent headlines have been filled with layoffs, hiring freezes and job offers being pulled as a result of leadership decisions that didn't pay off.

Spotify’s CEO Daniel Ek recently admitted the company had been “too ambitious” with its mid-pandemic aggressive expansion, and that consequently the firm would be cutting more than 600 jobs to rein costs in.

Ek said he took “full accountability” for the decisions that resulted in lay offs being necessary.

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Thousands of layoffs have also been made this year at tech giants including Amazon, (18,000 cuts announced) Microsoft (10,000) and Meta, (11,000) which is downsizing after a pandemic-led hiring spree left them flabby in a weak economy.

In an email to all staff explaining the redundancies, Satya Nadella, Microsoft’s CEO, revealed a situation like that being revealed at Spotify.

“As we saw customers accelerate their digital spend during the pandemic, we’re now seeing them optimize their digital spend to do more with less,” said Nadella.

Amazon also admitted that its sweeping layoffs were the result of hiring too many employees during the pandemic, which naturally saw a boom period in online shopping.

Keep employees informed

One of Gingiss’s biggest gripes was with the lack of transparency from Virgin Orbit’s leadership to the workforce. In the current economic climate coupled with the cost-of-living crisis, it’s hard not to expect history to repeat itself, so staying honest with your staff about company issues is the best way to avoid litigation further down the line.

Kevin Poulter, Employment Partner at national law firm Freeths, recently spoke to HR Grapevine about the staff cuts being witnessed across the tech sector. He believes such massive cuts should be a warning for employees and investors and business owners, besides the prospect of litigation.

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“If employees sense trouble ahead, they will be more likely to take up other opportunities they might otherwise of passed up,” explains Poulter.

“As shareholders become more demanding, the freedom of innovation and access to investment which once attracted talent will reduce, encouraging longer serving employees on which the success of the company was built to reassess their own futures. And so the circle continues.”

How should HR move ahead with tough decisions?

Tina Hyland, Employment Law Adviser and Solicitor at WorkNest, previously told HR Grapevine: “2023 is going to be a challenging year.

“Unfortunately, this does mean employers will be looking to make some difficult decisions, such as making redundancies or restructuring the workforce, as staffing costs are usually a significant expense for a business. Suppose that’s an avenue they decide to take; in that case, employers must be prepared to negotiate with employees to ensure they receive a fair deal.

“We highly recommend businesses reduce the chances of making any employees redundant by making alternative choices where possible, including implementing pay freezes or reducing benefits. However, each option comes with its own risk, so obtaining proper legal advice is critical in making the right decision for your business while minimising the negative impact on employees.

“Unfortunately, in the context of the recession, any cuts inflicted on employees due to employers’ decisions, such as restructuring or pay freezes, may be detrimental to employee’s mental health, especially with further worries to their financial wellbeing throughout this time. Supporting employees with additional benefits that might be available to them already, including Employee Assistance Programmes to retailer discounts, could help improve an employee’s bottom line in other ways.”

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