Netflix employee confidence erodes amid layoffs as former employees say company culture is changing

A few months ago, Netflix began releasing an internal Google Doc containing revisions to the company’s culture note. The document garnered some 10,000 comments from employees before the final product – posted on Netflix’s jobs site – was made public in early May.

The memos included a directive for employees to “pass [Netflix] members’ money wisely” and a reminder that leaders should also be held accountable for upholding company values. But there was one section in particular, on ‘artistic expression’, which caught the attention of some staff.

More from The Hollywood Reporter

“Not everyone will like — or agree with — everything about our service,” the note states, ending with a message aimed directly at staff members: “Depending on your role, you may need to work on titles that you perceive to be harmful. If you’re struggling to support the breadth of our content, Netflix might not be the best place for you.

The updated entry appeared to be a direct response to the streaming giant’s internal and public outcry last October in response to The closest, a Dave Chappelle comedy special that included several transphobic jokes. Although Netflix received a lot of public backlash and co-CEO Ted Sarandos admitted that he “damnhis initial responses to staff members’ concerns at the time, the streamer then announced a deal with Chappelle to four more comedy specials and has taken a harder line toward what it sees as “artistic freedom” — even at the potential expense of its own employees — as part of its corporate culture.

“In 2021, talking about what’s in the best interest of the company was still part of the culture,” said a former Netflix employee. The Hollywood Reporter. “With the rewrite, … Netflix has made it clear that the new command is ‘if you don’t like it, leave’.”

While most organizations today typically have a values ​​document, Netflix stood out in 2009 when CEO Reed Hastings released the company’s management approach as a set of 125 slides that included seemingly radical concepts at the time, like unlimited vacations and ‘breaking the rules.’ The game, which has since been revised into a formalized culture note, served as the inspiration for Hastings’ 2020 book, No Rules Rules.

But this month’s memo change comes during a time of major upheaval for Netflix, which is dealing with slowing subscriber growth as rivals like Disney breathe down the streamer’s neck. In the first quarter of the year, Netflix lost 200,000 subscribers and expects to lose 2 million more in the second quarter – losses that have cratered the company’s stock and have employees and investors worried about to the future growth of the once high-flying, high-flying company. -spend the streamer. To help avoid some of these losses, Netflix has started experimenting with new areas of business, such as advertising and video games – the former which Hastings was once fiercely opposed to.

But as with any company trying to cut costs, Netflix is ​​reining in spending growth and has put in place two rounds of major layoffs in the space of a month, with the latest round cutting 150 full-time employees, roughly 2% of the company’s total workforce, and several dozen contractors working in the editorial division from Netflix – some of whom were hired just a few months ago and worked specifically on channels meant to serve underrepresented identities like Strong Black Lead, Con Todo, Most and Netflix Golden.

Social channels are all managed within Netflix’s marketing division and are intended to elevate Netflix’s programming tailored to specific audiences and build strong communities with viewers. Strong Black Lead, for example, was launched in 2018 as a way to promote Netflix programming featuring black talent and creators and build a meaningful community with black audiences year-round. Since then, the marketing brand has launched an original video series, a podcast and has amassed 804,000 followers on Instagram and over 253,000 followers on Twitter.

Following this success, the Netflix marketing team launched additional channels like Con Todo, for Latin American communities; Mostly for LGBTQ+ audiences; and, most recently, Golden, for the Asian diaspora. Each of these channels has several thousand followers on Instagram and Twitter.

Netflix said the editorial cuts, which have been made across all social channels — not just identity-focused ones — are part of a broader strategy to ensure social content is created in-house, rather than by external subcontractors. The company also laid off a number of employees from the family and animation divisions in the latest round of layoffs and scrapped the ongoing animation projects of Ava DuVernay and Meghan Marklealthough Netflix said these series were removed for creative reasons.

“We are making changes to how we support our publishing efforts, including bringing some of this important work in-house,” a Netflix spokesperson said. “Our social networks continue to grow and innovate, and we are investing heavily in them.”

Although social accounts are still working, fired editors question Netflix’s commitment to diversity, as many contractors said they were encouraged to join Netflix because of its perceived focus on support to writers, publishers and creators from diverse backgrounds.

In addition to promoting specific identity-focused social channels, Netflix underscored its commitment to inclusion with recent financial commitments, including transferring $100 million, or 2%, of its financial holdings to banks that support black communities and creating a $5 million fund. invest in black creators and businesses. The streamer has also focused on improving the diversity of its own staff; Last year, Netflix said women make up half of its global workforce, while about half of its US workforce is global majority, according to the 2021 Diversity Report. of the company.

“There was so much talk about how committed Netflix was to diversity and inclusion, and I think a lot of us who were recruited really believed that,” notes a second former Netflix editor who was affected by the recent round of layoffs. . “Writers are really a big part of the amazing content you see on these channels and [bring] really broad and diverse perspectives, so it’s a shame we were all let down.

It didn’t help either, according to two entrepreneurs who spoke with THR, both rounds of layoffs came with very little notice. (Netflix’s contractors are employed by outside agencies, and at least one of the agencies — Made by Fabric — appears to have shut down completely after the recent round of layoffs.)

“They have to reinvent themselves,” adds a third former staff member who was fired in April of the changes at Netflix. “It’s such a corporate thing [where] someone in high places who makes, you know, 10 or 20 million dollars a year makes a bad decision or postpones dealing with an issue and the people on the ground must suffer for it. It definitely sucks.

That’s not to say Netflix layoffs or layoffs are particularly unusual at the streamer, which notably has a “gatekeeper test” that guides the company’s approach to layoffs. (“If a team member left for a similar role at another company, would the manager try to keep them? Those who don’t pass the goalkeeper test (i.e. their manager wouldn’t fight to keep him) are receiving a generous severance package so we can find someone even better for the job,” Netflix’s culture note reads.)

But with the latest round of layoffs being determined by “business needs rather than individual performance,” as a Netflix spokesperson said at the time, employees noted the loss of trust between Staff. “It makes it feel like they’ve really lost control of the narrative, like it’s out of control,” adds another Netflix insider. “Trust has been eroded.”

As for how Netflix will handle future employee dissent, the updated memo regarding “artistic expression” will also be put to the test in light of a new comedy special from Ricky Gervais, which includes several jokes about trans women. Netflix hasn’t responded to repeated requests for comment on Gervais’ special, and if the company’s handling of the Chappelle special is any indicator, it’s likely the streamer will support the comedian again.

“It was part of the culture, and people saw it as allowing them to express themselves openly. The new culture memo makes it clear that creators are now protected from having to listen to the opinions of anyone they disagree with,” the first former Netflix employee said. “It’s such a shame, because if they’re not listening to minority-affiliated employees and also tracking viewer activity through that lens, they’re operating in a cultural black box.”

Click here to read the full article.