Canva layoff memo draws rave reviews, but some disagree with the 'flood of applause' - CNBC

Layoffs are never good news. But one company's layoff announcement has sparked online praise, with some calling it a "masterclass" in communication.

Canva, an Australia-based graphic design platform, announced on Nov. 3 that it would restructure 22% of its global workforce. Some of the 1271 employees impacted by the change may have to relocate or face changes to their role, while others will be laid off.

Melanie Perkins, the company's CEO and co-founder, shared the news online via an internal memo.

"This is without doubt the hardest moment in our thirteen-year history," Perkins wrote. "Behind every decision is someone we care deeply about, and I know the consequences will be very real for those directly affected, their families, friends and teammates. I'm deeply sorry for the pain and disruption this will cause for everyone affected."

In the memo, Perkins also promised that every laid-off employee would receive at least six months of salary and 12 months of continued healthcare coverage, plus access to career support resources. Employees will get to keep their company-issued MacBook, and Canva will offer $10,000 grants for departing employees who want to start businesses of their own.

Caroline Hacker, a marketing professional who was laid off in June, says she was "impressed and surprised" by the tone of Canva's memo.

Perkins "made it very personal," she says. "It struck me as honest. It didn't feel engineered."

There's never a good way to find out that you're losing your job, Hacker says — at her previous job, she received the news in a short Zoom call — but "if you're going to get laid off, I would rather have that be the memo."

Perkins' transparency and openness also stood out, says Dylan Jones, managing partner at Boldsquare, a strategic communications and management consultancy firm.

Rather than hiding behind corporate jargon, Perkins "talks about how she feels as a human being," he says. "I think some leaders feel like showing empathy is a sign of weakness, and she doesn't do that."

Jones also points out that Perkins took responsibility for conducting layoffs in her message: "She's very clear that the decision was coming from her. She wasn't trying to say, 'Hey, look, investors are making us do this.'"

But some question the amount of positive attention the company has garnered.

"My initial reaction was, 'Why are we celebrating a layoff?'" says Meredith Klein, a former communications executive and author of Meredith & The Media, a media-focused newsletter. "Are we so desensitized to layoffs that our first reaction is to praise how they were done, versus to acknowledge what happened?"

Yes, Perkins "did a great job communicating" the layoff news, Klein says. It's all too common for companies to conduct a mass layoff via Zoom or email, then "shut your computer off immediately."

"In comparison, I think people genuinely were like, 'This is incredible. This is the way it should be,'" she says.

But amid the "flood of applause" for how Perkins delivered the message, Klein feels that many people are overlooking the human impact of the layoff.

"CEOs can apologize as much as they want and be as generous as possible," she says, but for laid-off workers, "your life is still completely about to change."

Erin McGoff, a Washington, D.C.-based career expert and content creator, says she was impressed by Canva's layoff package, which included at least 24 weeks of salary for all employees, regardless of location.

On average, most U.S. companies pay about 3 to 6 weeks of severance, according to a recent survey by LHH, a management consulting company. In Australia, companies with 15+ workers are required to provide at least 4 weeks of severance pay to permanent employees who have worked there for over a year, increasing based on the duration of their employment.

"Nowadays, it's very normal in our culture to lay people off with virtually nothing," McGoff says. "You can get away with that, and no one's really going to blink an eye. They're going to say, 'Oh, you're just like every other company.'"

In recent years, the public perception of layoffs has gone from "something that was embarrassing or even humiliating" for a company to "something that is almost strategically smart to do," according to McGoff. In some cases, she's heard business leaders refer to laying people off as "trimming the fat."

McGoff's takeaway for business owners is, "Stop being cowards when it comes to layoffs," she says. "The more humane you can be, the better it will be in the long run" for both the company and its departing workers. It also sends a message to the company's remaining workforce, according to Jones: "The people who are staying look at how you treat people on the way out the door."

Hacker says she was also impressed by the "generous" terms of Canva's layoff, but she notes that in today's job market, "a lot of these people are not going to find work" before their severance benefits run out. Almost 28% of unemployed U.S. workers — about 2 million people — have been searching for work for at least 27 weeks, according to the latest jobs report from the Bureau of Labor Statistics.

Still, for Hacker, the way leaders handle these situations still matters.

"Layoffs are happening left and right anyways," she says, but handling it with "thought and empathy" can make it "an easier pill to swallow."

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