UKG, the privately held software company with deep roots and a headquarters operation in Weston, intends to lay off 14% or about 2,200 of an estimated 15,000 employees, its top executive informed employees the day before July 4.
“We are announcing a number of organizational changes that will allow us to aggressively focus on critical areas of growth and to provide flexibility to actively invest in important new areas,” Chris Todd, the chief executive officer, wrote in an email early Wednesday morning. “These changes mean we have made the difficult decision to say goodbye to ~14% of our colleagues. A top priority through this change is treating those leaving with care, dignity, and respect, and providing support to make their transitions as smooth as possible.
“I know notifying you of this news the day before a holiday in the U.S. is very difficult timing,” he added. “We originally planned to share these changes next week, however, due to news and speculation related to this action circulating internally, we chose to accelerate the timing to today to provide you clarity and reduce employees going through the weekend in a state of uncertainty.”
The company has yet to make the specifics of its layoffs plans public, and offered a general statement Friday when asked for more details by the South Florida Sun Sentinel.
An industry swept by layoffs
Since 2022, heavy layoffs have been a constant in the technology industry as companies turn to automation and artificial intelligence to conduct operations and undertake innovation. Some of the bigger companies to have cut loose large numbers of workers include Amazon, Apple, Cisco, Ericsson, Google, Microsoft, Snap and Tesla. Thus far this year, 360 companies have fired more than 104,400 people, according to Layoffs.fyi. For 2023, the tracking site calculates 1,191 technology firms dropped 263,180 employees from their payrolls.
“UKG is implementing organizational changes that allow us to aggressively focus in critical areas of growth and support our long-term strategy,” a spokesperson said in the statement. “While decisions that impact our team are not ones we come to lightly, these changes will allow us to redirect resources and invest in key areas of product innovation while enhancing how we support our customers. We are committed to supporting our colleagues through this transition.”
As of early Friday, the company had not filed any layoff notices with the state of Florida under the federal Worker Adjustment & Retraining Notification Act. There was no immediate information available on the company’s current South Florida head count or how many would lose their jobs here.
In his email, Todd said the company had started notifying the impacted employees in the U.S. and Canada on Wednesday, “with the goal to complete notifications in all regions by early next week.”
He said UKG would follow any “consultation” processes required by local laws in other countries where employees are to lose their jobs.
Those leaving the company will receive severance pay, a “prorated 2024 annual bonus for eligible departing employees,” job search support, continued health benefits for a defined period and access to a company employee assistance program, Todd said.
A force in HR management
Owned by private equity firms, UKG, which stands for Ultimate Kronos Group, is a multi-billion dollar company that provides software to businesses, schools and government agencies for human resources, payroll and workforce management.
More than five years ago, it was formed from a merger between Ultimate Software, a publicly traded firm based in Weston, and Kronos, a Boston-area company that also developed and sold workforce management tools for businesses and agencies in the private and public sectors. The all-stock deal was valued at $22 billion.
UKC formerly was a sponsor of the NBA Miami Heat basketball team, with a small patch bearing the company’s initials appearing on the players’ uniforms.
After Ultimate Software and Kronos formally combined forces in February 2020, UKG said it would have annual revenues of “approximately $3 billion, more than 12,000 employees worldwide … with further plans for growth including the addition of 3,000 employees.”
According to subsequent published reports, the company appears to have achieved or exceeded those goals, reaching revenues of more than $3.65 billion in 2022, and an employment threshold of 15,000 people this year spread over 24 locations in the U.S., Canada, Europe and Australia.
Post-merger, the company has been jointly headquartered at offices in Weston and in Lowell, Mass., the original location of Kronos in the greater Boston area.
UKG’s controlling shareholder is Hellman & Friedman, a 40-year-old private equity firm based in San Francisco. Ownership stakes are also held by private equity funds managed by Blackstone, the largest minority shareholder, and other investment entities including the Canada Pension Plan Investment Board.
Hellman & Friedman has made no public mention of the impending layoffs.
