Laid-off Big Tech workers are getting invited to return—on unfavorable terms

The trend is unusual not just for growth-obsessed Silicon Valley, but the economy more generally, experts tell IT Brew.
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Francis Scialabba

· 3 min read

As if it’s not bad enough to get the pink slip, some of the tens of thousands of workers laid off by tech firms suddenly seeking to tighten their belts are finding themselves courted by those very same employers on less favorable terms.

The Seattle Times reported that many recently terminated employees are being pitched on the possibility of returning to their old roles—by third-party recruitment firms that often ask if they’ll come back as contractors with no benefits, and for less money. The paper specifically spoke with former workers at Amazon and Microsoft, both of which have shed or are in the process of shedding huge portions of their workforce.

The reaction these offers generate is often less than welcoming, the Times reported. One former Microsoft worker told the paper that an offer to go back was “the last thing I need,” while another Amazon alum sent back a message saying that if the company wants the position filled, “they can just not fire me.” Recruiters told the paper the trend may be due to random chance, as placement firms circulate résumés, or because some companies treat contractors as a separate labor pool.

Boomerang reversal. Research has shown that returning employees typically make more than they did previously, making the current situation in tech unusual, according to Andrea Derler, principal at people analytics firm Visier’s research and value division.

Derler worked on Visier research showing that between January 2019 and April 2022, 28% of “new hires” across a wide range of industries were actually employees who had resigned from the same firm within the last 36 months. (In tech, that percentage is much lower, at 14%, according to HBR.) Returning employees tended to make roughly 25% more than when they left.

Tech firms may have realized too late that they overcorrected for a pattern of overhiring, leaving them to scramble to retain institutional knowledge, Derler told IT Brew: “Maybe they should have tried much, much harder to retain them in the first place…I don’t think that the positive story around boomerang employees can be maintained in a situation where you’re being laid off.”

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It’s also possible workers are being called back not to fill their old roles per se, but those of ex-colleagues who subsequently left on their own terms. Derler pointed to other Visier research on turnover contagion, or the risk of departures starting a domino effect. Her team found that one resignation can increase the risk of other departures by 7%–25%, and that a similar (but weaker) trend follows layoffs.

“That is really fascinating, because we don’t know how many organizations are actually almost counting on that when they do their calculations about layoffs,” she told IT Brew.

Tread carefully. The sudden shift to job-slashing throughout Silicon Valley has left tech professionals in a more precarious position.

Brian Swider, a professor of management and expert on boomerang employment at the University of Florida’s Warrington School of Business, told IT Brew academics have yet to extensively study the dynamics of rehiring laid-off workers. His advice to employees receiving such an offer: tread carefully and ask a lot of questions.

“Why are you being brought back? Why were you fired? Or why were you terminated? What sort of guarantees can you get either in writing or implicit guarantees about what the terms of the return look like?” Swider told IT Brew. “If you’re an independent contractor, you should really start to get a sense of how long this relationship is expected to last.”—TM

Top insights for IT pros

From cybersecurity and big data to software development and gaming, IT Brew delivers the latest news and analysis of trends shaping the IT industry, like only The Brew can.