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- Redfin announced in an SEC filing that it will lay off 7% of its employees by the end of April.
- The Seattle-based real estate brokerage also said 41% of its agents would be leaving by April 10, most on furlough.
- One of the factors that contributed to the furlough decision, CEO Glenn Kelman said, was the federal government's expanded $600 weekly contribution to each person's unemployment insurance.
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The Seattle-based real estate brokerage, Redfin, is cutting back its staff in the midst of the coronavirus pandemic.
The company announced in an SEC filing on April 7 that it will be laying off around 7% of its employees by the end of the month.
Calling it "the worst day for Redfin," CEO Glenn Kelman posted an article disclosing that 41% of the brokerage's agents will be leaving by April 10 - most on furlough. Some of these, including new hires, have been asked to leave permanently, he added. "The great majority" will go on furlough until September 1, with a transition bonus and health-care benefits through the summer, he added.
As of December 31, 2019, Redfin had 3,377 employees, according to its annual filing for 2019, which also disclosed that it had 1,553 average lead agents for the year.
One of the factors that contributed to the furlough decision in particular, Kelman noted, was the federal government's $600 weekly contribution to each person's unemployment insurance, which is part of the $2 trillion stimulus that was signed into law in late March.
"Of the field folks leaving, we estimate about 75% live in states that will allow them to earn more from unemployment insurance than from Redfin," he wrote.
In the article, Kelman also announced that employees in charge of the brokerage's technology and programs will be receiving a 10%-15% pay cut and will not receive bonuses this year.
"To those who have been asked to leave Redfin today, thank you. I can't imagine the grief we've caused you," he wrote. "I'm sorry we let you down. We'll fight like wild animals to bring everyone on furlough back."
Kelman also disclosed some details on Redfin's hiring strategy and the market's outlook, saying that every year it hires about 25% fewer agents than could be supported by the demand from Redfin.com, but "now housing demand is down much more than that."
Redfin follows a long list of real estate companies that have cut employees and salaries in the midst of the pandemic. As Business Insider reported in March, the brokerage Compass laid off about 375 employees - or roughly 15% of its staff. In addition, Realogy, which owns big-names like Century 21 and Coldwell Banker, cut both the salaries and work weeks of the majority of its employees, The Real Deal reported in late March.
Redfin did not respond to requests for comment.
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