Employees may want Better.com CEO Vishal Garg fired, but human resources professionals and academics never expected that to happen.
When we last saw Vishal Garg, he was heading out the door.
Garg, CEO of Better.com, was vacating the premises after unleashing a tidal wave of outrage when he fired about 900 employees last month via Zoom.
“If you’re on this call, you are part of the unlucky group that is being laid off,” Garg said during the now infamous Zoom call. “Your employment here is terminated effective immediately.”
Employees watching the video could be heard gasping and cursing as Garg told them their services would no longer be required at the New York-based company.
The embattled executive was also criticized for accusing employees of “stealing” from their colleagues and customers by being unproductive and only working two hours a day.
Garg later apologized for his handling of the situation and the company announced that he would be taking some time off.
Well, Garg’s time in the penalty box is now over as several media outlets have reported that he’s back on the job.
“Vishal will be resuming his full-time duties as CEO,” according to an internal memo obtained by the Daily Beast. “We are confident in Vishal and in the changes he is committed to making to provide the type of leadership, focus, and vision that Better needs at this pivotal time.”
Did Better.com Do a Thorough Investigation?
The memo described how the new and improved Garg had taken a break “to reflect on his leadership, reconnect with the values that make Better great and work closely with an executive coach.”
And while some may be somewhat shocked to see Garg back at the helm so soon after lowering the Zoom on a group of people that roughly matches the population of Blue Ridge, Georgia, workplace analysts and educators were not.
Wojtek Dabrowski, managing partner of Provident Communications, a crisis communications firm, said senior leaders have been known to step away after some corporate snafu only to return following some sort of internal review or investigation with a commitment to do better.
“However, what is surprising here is the speed with which he has returned,” he said. “The Zoom firing was just last month. Is it possible to have him step away, the company conduct a comprehensive culture review and have him back in the CEO seat in just a handful of weeks?”
“It makes you wonder how thorough this investigation was, and whether Garg has learned anything in the meantime,” Dabrowski added.
Tessa West, associate psychology professor at New York University, said that while firing people en masse over Zoom sounds extreme, Garg wasn’t the first executive to do it.
“The hard truth is, even if we don’t like the way our leaders behave, they can be hard to replace, and so we often don’t,” said West, author of “Jerks at Work.” “A public commitment to change is often all it takes to get someone back into their position. That, plus throwing money at the problem–like bringing in a coach or a DE&I expert to train people on ‘how to behave better.'”
While Garg fired about 9% of the company’s workforce, that still leaves 91% who aren’t likely to forget what happened to their coworkers.
“While they may forget what Garg said or how he handled himself, it’s unlikely they will forget the way they were made to feel – like a bunch of office equipment being discarded with a couple of sentences from their CEO over Zoom,” Dabrowski said.
West said she can “imagine that there is a lot of eye-rolling going among Better.com employees.”
“Most people realize that these symbolic moves to get back into people’s good graces don’t work,” she said. “They often backfire because they give people like Garg moral license to be a jerk again once the spotlight has moved on to someone else.”
Does Better.com Have a Toxic Culture?
Peter Cappelli, professor of management and director of the Center for Human Resources at Wharton University, said “the main issue for the company was the public relations damage, and that passes pretty quickly. “
“It isn’t that unusual to have leaders who are interpersonally challenged,” he said. “The reason this got so much attention is because it was on video.”
Ingo Walter, professor emeritus of finance at NYU’s Leonard N. School of Business said that “it remains to be seen whether for Garg this is an isolated and unthinking slip-up or indicative of a character flaw that should ultimately prove to be a career-ender.”
And so will Better.com be better for this experience? That depends.
While having a jerk for a CEO certainly matters to the people who work at the company, Cappelli said “it doesn’t matter much to the people who keep the CEO in that job.”
West said there is a new study out showing that toxic culture is the biggest predictor of the Great Resignation, where Americans are quitting their jobs in record numbers.
“People have no tolerance for it,” she said. “And they have no tolerance for it’s tolerance! It’s not enough to have a direct supervisor who is great but have a C-Suite that engages in terrible behavior.”
Dabrowski said C-suite executives are not above reproach or immune to accountability.
“However, the bar for what triggers the removal of a CEO for a leadership failure varies dramatically from company to company,” he said. “It ultimately comes down to what the board views as unacceptable and how willing they are to accept short-term instability at the top in order to change out the CEO.”
Walter said “loyal, considerate and relationship-driven employers deserve a high degree of loyalty from you, even under turbulent market conditions.”
“Employers that are ‘transactions-driven’ and hire and fire as needed-showing minimal loyalty to their people-deserve little loyalty in return,” he said.
