Shopify to cut 20% of its workforce in layoffs

May 4 (UPI) -- The Canadian e-commerce giant Shopify announced Thursday it was cutting 20% of its workforce, marking the second round of layoffs within the past 12 months.

Shopify CEO Tobias Lutke told his employees about the cuts in on the company's website. Shopify has about 11,600 workers and contractors at the end of 2022. Lutke added that Flexport will buy Shopify Logistics.

"I recognize the crushing impact this decision has on some of you and did not make this decision lightly, "Lutke said in the statement . "There's no way to make this good news, but we designed a package that will attempt to make it the best possible version of a bad day. I've included details ... on how we will support you."

Lutke said those leaving Shopify will receive a minimum of 16 weeks severance plus a week for every year of tenure there. They also will receive medical benefits and access to the employee assistance program for the same period.

"We'll also offer outplacement services if you want them, all office furniture we provided is yours to keep," Lutke said. "We legally need the work laptop back, but we'll help pay for a new one to replace it.

"You'll have continued free access to the advanced Shopify plan should you opt to take an entrepreneurial path in the future."

Lutke said the goal of the get Shopify refocused on its main goal. He said logistics had gotten in the way of that focus, leading to the sale to Flexport, a 10-year-old freight company in which Shopify has a financial stake.

"Contributing our work to Flexport, under the leadership of Harish Abbott, allows everything about Shopify Logistics to be more ambitious and global in nature," Lutke said.

"Making the global supply chains efficient and software addressable is Flexport's main quest and so this is the perfect home for this part of Shopify. "

This article originally appeared on UPI.com