What truly valuing your employees looks like!

Good companies, companies who value their employees, show it in word and in deed. When Zappos recently laid off 8% of their employees this is part of what they did, and said:


"...we are reducing our staff by 8%, but because we are being proactive instead of reactive about it, we are able to take care of our employees and offer them more than the standard 2 weeks severance (or no severance) that most other companies are giving.

We are offering to pay each laid-off employee through the end of the year(about 2 months), and offering an additional amount for employees that have been with us for 3 or more years.

In addition, because our regular health benefits cover 100% medical, dental, and vision for employees and 50% for spouses and dependents, we decided to offer to reimburse laid-off employees for up to 6 months of
COBRA payments.

In doing all of this to take care of laid-off employees, we expect that it will actually increase, not decrease, our costs for 2008, but we feel this is the right thing to do for our employees. It will put us in the position of having a lot more financial flexibility in being able to respond to potential changes in the economy in 2009.

Ecommerce growth has slowed compared to its growth rate a year ago, but the good news is that even in this tough economic environment, ecommerce overall is still growing.

Within the footwear category, we are the online market leader. When times are tough, the strongest players in any market have an opportunity to gain even more market share, even if overall growth may be slower. Historically, we have actually grown faster than the overall ecommerce market, and we anticipate for that to continue in 2009.

For the rest of 2008 as well as for 2009, we anticipate continuing to grow year over year. Our current forecasts are that we will continue to be profitable and cash flow positive, as long as we are proactive instead of reactive in managing our business and financials.

I know that many tears were shed today, both by laid-off and non-laid-off employees alike. Given our family culture, our layoffs are much tougher emotionally than they would be at many other companies.

I've been asked by some employees whether it's okay to twitter about what's going on. Our Twitter policy remains the same as it's always been: just be real, and use your best judgement.

These are tough times for everyone, and I'm sure there will be many follow up questions to this email. If you have any questions about your specific job or department, please talk to your department manager. For all other questions, comments, or thoughts, please feel free to email me.

* Tony Hsieh, CEO