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Patagonia, the sustainable outdoors brand that vows to put purpose above profit, this week gave 90 employees a life-altering choice to make.
On Tuesday, members of its customer experience (CX) team were asked to decide whether they would be willing to relocate across the US to one of seven locations or to leave the organization. The kicker? They have to let the company know by Friday.
Enforcing such a monumental decision on its employees seems a little out of character for the company toted as the most reputable brand in the US. What gives?
Patagonia’s purpose – at the expense of its people?
It was September 2022 – just under two years ago – when Patagonia pledged to make Planet Earth its only shareholder.
In an open letter, founder Yvon Chouinard said the company would be “going purpose,” which it defined in 2018 as being “in business to save our home planet.”
It was perhaps the most famous public commitment by a brand toward an environmental, social, and governance (ESG) business model, rightly hailed for its radical pledge for all future excess profits to go to “fight the environmental crisis.”
Patagonia transferred all of its voting stock to The Patagonia Purpose Trust, which it created to protect the company’s mission and values. This gives the trust the freedom to approve decisions including who sits on the board, and the accountability for its legal position on areas including its B Corp commitments. All non-voting stock was transferred to a nonprofit.
With the ‘E’ and the ‘G’ well and truly ticked, what of the ‘S’? This refers to the ‘social’ factors that impact a company’s relationship with its employees as well as customers, suppliers, and other stakeholders.
Well, in 2022, Chouinard declared that Patagonia’s employees were at the core of its success. “We will keep doing all of the great things that built Patagonia, and the company will keep doing its best to be a great employer,” he wrote in a Q&A accompanying the letter.
Just 21 months later, could Patagonia still claim to be making that same commitment?
Employees: “It feels like they’re full of shit”
The 90 employees told to make their decision on relocation were informed on Tuesday at 10 am PT, giving them 72 hours to decide. Following the update given in a town hall meeting, employees had a follow-up one-on-one meeting with HR.
Executives Amy Velligan and Bruce Old told staff the company would be moving to a “hub” model, with CX employees required to move to within 60 miles of one of seven sites in Atlanta, Austin, Chicago, Dallas, Pittsburgh, Reno, or Salt Lake City by September 30.
Granted, Patagonia is offering $4,000 in coverage toward relocation costs with additional PTO, but employees are not happy about the mandate.
“It was very factual. If you don't live in these seven metro areas, you either need to move there or give us your stuff and hit the brick," one CX team member said, speaking to Business Insider.
"If we don't respond by Friday, they will assume that we have chosen the severance package and we'll start that process,” they added, suggesting a rather ruthless tack from Patagonia.
Understandably, members of the CX team aren’t best pleased. "I definitely feel like I've been laid off," one stated. "It feels like they're full of shit, that they would rather spend their money on the world instead of their people," declared another.
Indeed, it’s a rather unexpected move from a company that proudly professes to be turning capitalism on its head.
Is Patagonia “a big corp in sheep’s clothing”?
Why then is Patagonia making this altogether unpopular decision, which arguably places it a long way short of the status of a great employer?
According to Patagonia’s Head of Communications, Corley Kenna, who spoke to Business Insider, the changes are “crucial for us to build a vibrant team culture.”
Kenna also noted that members of the CX team had complained about feeling disconnected, stating plans to bring staff into the hubs once every six weeks for training programs, company gatherings, and ‘Activism Hours.’
But Kenna also admitted that the locations selected were impacted, alongside other factors by the high costs of living in other locations. That includes California, which despite being home to the brand’s corporate HQ, is not one of the eligible hubs.
Moreover, Kenna even hinted to Business Insider that Patagonia needs to trim staffing costs on its CX team. “The reality is that our CX team has been running at 200% to 300% overstaffed for much of this year,” she told BI. "While we hoped to reach the needed staffing levels through attrition, those numbers were very low, and retention remained high.”
Employees would be forgiven for concluding that while Patagonia says it is putting purpose above profits, the reality shows profits are coming before people; that its ambition to turn capitalism on its head was simply not possible; or even, as the worker summed up, is “full of shit.”
One of the employees stated that Patagonia has fallen “to the Walmart level,” with the retail giant having also asked many workers to relocate amid hundreds of job cuts. Critics of the relocation programs taking place at Walmart, Dell, and elsewhere have described them as a form of quiet firing.
Particularly considering the 90 employees were given less time to decide than it takes a typical Patagonia parcel to be processed and delivered, it’s tricky not to see the relocation mandate as a way for the sustainability company to address its overstaffing issues.
Patagonia’s staff believe that despite the company’s golden reputation, employee interests have been de-prioritized.
"I think that the company has changed a lot since it sold to Mother Earth," one of the Patagonia employees told Business Insider. “Since Yvon stepped away, it's been a slow burn of shifting away from caring about employees.”
"Patagonia is not this small niche outdoor company anymore, it's a big corp in sheep's clothing,” they added. “I still think they made good products, but I think they don't treat their people as well as they claim to."
Such a strict relocation mandate may well be the straw that broke the camel’s back, making us question whether Patagonia can still be considered the most reputable company in the US; whether it can still claim to be a great employer; and even whether it can still be said to value its purpose over profits.
