Speaker 1: Back in things were looking pretty rosy for We Work.
Speaker 1: The company had just doubled its valuation and raised more
Speaker 1: than four million dollars from investors, and it was using
Speaker 1: some of that cash to buy up smaller companies. When
Speaker 1: We Work bought a company, those employees became We Work employees,
Speaker 1: and they would start coming to the all hands meetings.
Speaker 1: We go to do the Monday night meeting and we
Speaker 1: walk in and the way that it's set up is that,
Speaker 1: you know, there's a stage and it's filled with people.
Speaker 1: That's Joanna Strange. She's going to be our focus for
Speaker 1: the first half of this episode. Up until the moment
Speaker 1: she's describing, Joanna had been working for an architecture company
Speaker 1: called Case. Case made software that helped architects design buildings faster.
Speaker 1: We Worked bought Case, and she became an operations manager
Speaker 1: and she found herself with this job at a company
Speaker 1: she never applied to. Joanna remembers the first all hands
Speaker 1: meeting that she attended, you know, the ones called thank
Speaker 1: God it's Monday. Everyone was too white eyed and too eager,
Speaker 1: and they we chanted, we work, we chanted, we work,
Speaker 1: we work, And then we hit a gong. Oh yeah,
Speaker 1: and I would yell we, and we would say work,
Speaker 1: and then he would say we, and then we would
Speaker 1: say work. And then at some point someone hit a gong.
Speaker 1: I don't know why the gong was there. I don't
Speaker 1: know why it was there. It was there was gong
Speaker 1: hitting We worked. Customs left her feeling bewildered, and I
Speaker 1: go to sit next to the stage and I'm sitting
Speaker 1: with a couple of colleagues and Adam comes out to
Speaker 1: talk and about ten minutes in, my colleague turns to
Speaker 1: me and says, I think this is a fucking cult.
Speaker 1: And I said, possibly, you're listening to Foundering. I'm your host,
Speaker 1: Ellen Hewitt. Last week we talked about WE Worked sparkly
Speaker 1: outward facing image. The company had fast growth, a big valuation,
Speaker 1: a quirky CEO, and a cool looking product and that
Speaker 1: all added up to an exciting public brand that was
Speaker 1: attracting investors, employees, and customers alike. But by some cracks
Speaker 1: and We Works facade were beginning to show. And that
Speaker 1: was because some employees were starting to speak out publicly
Speaker 1: about what they saw as problems inside the company. So
Speaker 1: in this episode, we want to look at lawsuits as
Speaker 1: we got bigger it got into more and more legal
Speaker 1: conflicts with its employees. As a business reporter, I've always
Speaker 1: paid attention to lawsuits because they show you the less
Speaker 1: public side of the company. Not everything that's in a
Speaker 1: lawsuit is true. Sometimes people exaggerate claims or present only
Speaker 1: half the truth, but there's often something there. A lawsuit
Speaker 1: can suggest. What does this company really prioritize? How does
Speaker 1: it treat its employees? There are often gaps between what
Speaker 1: companies say they value and how they really act. This
Speaker 1: episode will look at the stories of two very different employees.
Speaker 1: Both of them felt wronged by We Work. Both of
Speaker 1: them decided to speak out about it, and in return,
Speaker 1: they say they got punished by the company. We've heard
Speaker 1: in previous episodes how fun and chaotic it was to
Speaker 1: work at We Work under normal circumstances. These stories are
Speaker 1: a little different. They come from employees who say the
Speaker 1: company showed a meaner side when things got ugly, when
Speaker 1: there were conflicts. These are early examples of employees trying
Speaker 1: to tell the public that they believed something was not
Speaker 1: right at WE Work. They wanted to interrupt the public
Speaker 1: image that We Work was presenting the world. A startup
Speaker 1: with a booming business that was transforming the workplace by
Speaker 1: the way. We asked We Work and a representative for
Speaker 1: Adam Newman if they wanted to comment on the stuff
Speaker 1: we describe in this episode. They largely declined to comment.
Speaker 1: We Work only at one statement. We Work has zero
Speaker 1: tolerance for discrimination or harassment of any kind, and we
Speaker 1: are committed to moving the company forward and building an
Speaker 1: organization and culture that our employees can be proud of.
Speaker 1: Many employees I spoke to were frustrated by what they
Speaker 1: saw as we Worked lack of transparency. They felt that
Speaker 1: we Work should be transparent because the company said that
Speaker 1: it valued authenticity they have on their site. We are
Speaker 1: always honest and as transparent as we can be. We
Speaker 1: are in this together. We always look out for one another,
Speaker 1: and their employees believed them. A few months into her
Speaker 1: time at We Work, Johanna found herself in a situation
Speaker 1: that she felt was a little shady. At the time,
Speaker 1: like at any company, there was some bureaucratic backlog of
Speaker 1: tasks that needed doing. One of the tasks was approving
Speaker 1: other employees self evaluations so they could receive their annual bonuses.
Speaker 1: But the executive who was supposed to prove them. Didn't
Speaker 1: have time to do it, so he came up with
Speaker 1: an alternative plan. My I'm manager's manager had given me
Speaker 1: his log into all of his stuff. So yeah, this
Speaker 1: story begins with Joanna having an executive's password, but she
Speaker 1: says she didn't steal it. It was given to her
Speaker 1: to do specific work related tasks. But this executive, maybe
Speaker 1: like some of us, reuss a password from time to time,
Speaker 1: It was a password for all of his stuff. Every
Speaker 1: single thing that he had was was, it was encapsulated
Speaker 1: under this one password, and he gave it to me.
Speaker 1: Not so I could do my job, but so I
Speaker 1: could do a job that he either felt too busy
Speaker 1: or too lazy to do. I don't know which one
Speaker 1: it was. So Joanna says she was told to take
Speaker 1: care of these evaluations. So he wrote his password down
Speaker 1: on a post it note and handed it to me,
Speaker 1: which I stuck on my monitor. So the password was
Speaker 1: a log into everything. It was a log into email,
Speaker 1: it was a log into docks, it was a log
Speaker 1: into the work day, it was a log into I mean,
Speaker 1: it was a log into absolutely everything. Joanna used this
Speaker 1: password often over the next few months to get stuff
Speaker 1: done for her boss and for her coworkers. It wasn't
Speaker 1: the most above board way of doing business or the
Speaker 1: most secure. And one day Joanna said she was checking
Speaker 1: email and she mixed up whose account she was logged into.
Speaker 1: I was in his system. Forgetting that I was in
Speaker 1: his system, I was, and I thought it was in mind.
Speaker 1: And the first thing I saw is an email that
Speaker 1: I had sent to my manager asking to be considered
Speaker 1: for a different position. And I saw the first part
Speaker 1: of his responses, which was something like that would be
Speaker 1: a fucking disaster. But then I noticed in the response
Speaker 1: was something like, but you know, we're not gonna she's
Speaker 1: not gonna be around much longer anyway. So when Joanna
Speaker 1: was logged into this executive's email, she found out she
Speaker 1: was going to lose her job. Obviously, she was hurt,
Speaker 1: and she kept scrolling. So then frankly, I just looked,
Speaker 1: because I had his log in, i'd you know, I
Speaker 1: was in his email now, And that was when I
Speaker 1: discovered that there was a call for a seven percent
Speaker 1: headcount reduction. That's a big freaking reduction. Joanna read in
Speaker 1: this executive's email that not only was she going to
Speaker 1: lose her job, but a lot of her coworkers were
Speaker 1: going to get cut as well, and this raised a
Speaker 1: red flag for Joanna. She was already feeling resentful about
Speaker 1: how we were spent money. She saw we work buying
Speaker 1: expensive furniture that it didn't always use and flying employees
Speaker 1: around the world. She felt like the company was careless
Speaker 1: with cash, and now, in her eyes, her coworkers who
Speaker 1: were about to be laid off and didn't know it,
Speaker 1: we're bearing the brunt of we works freewheeling spending. You
Speaker 1: realize you've been burning money, you've been throwing money away,
Speaker 1: You've been managing it really poorly. Then she started to
Speaker 1: see the job cuts actually happen. She asked her manager
Speaker 1: if they were planning to say anything about out it,
Speaker 1: and then people were disappearing. They did in phases, and
Speaker 1: then people were disappearing, and I said, hey, you guys
Speaker 1: are going to announce this right like that's a fairly
Speaker 1: significant headcount. You can't just not announce it. And he goes,
Speaker 1: I mean there was no plans to, And I said, well,
Speaker 1: maybe you should plan to, because you're creating a lot
Speaker 1: of fear and a lot of anks. So people were
Speaker 1: just being fired from teams escorted out the building and
Speaker 1: nobody knew what was happening, and people were looking for coworkers.
Speaker 1: In Joanna's mind, we Work was also being careless about
Speaker 1: how they dismissed their employees. There was one incident with
Speaker 1: one of her colleagues that really infuriated her. One of
Speaker 1: the women on our team was getting let go, but
Speaker 1: she got invited to a meeting by the woman who
Speaker 1: was doing the terminations and the room had been renamed
Speaker 1: something like termination conference room. Yeah, that was real. It
Speaker 1: was termination conference room. Termination conference room is a pretty
Speaker 1: careless thing to put on a calendar invitation, and Joanna
Speaker 1: is someone who takes that kind of slip up personally,
Speaker 1: Joanna said. When her coworkers saw the invite, she called
Speaker 1: Joanna in a panic, and then Joanna got protective. I
Speaker 1: call my supervisor and am livid and I'm like, this
Speaker 1: is this is so egregious. How careless do you have
Speaker 1: to be to do that? And if you're that careless,
Speaker 1: then how much do you really care about your employees?
Speaker 1: Like having a place for people to do yoga once
Speaker 1: a day does not count. She felt especially infuriated that
Speaker 1: we Work had said one thing and was doing another
Speaker 1: given how the company presented itself, we should tell people
Speaker 1: the truth because we say we're a different kind of company.
Speaker 1: We talk about I mean, in our mission same we
Speaker 1: talk about authenticity, right, are we going to be authentic?
Speaker 1: Part of that is truth telling. So the answer was no,
Speaker 1: we're not gonna be authentic, and that's one Frankly, I
Speaker 1: just went digging. So remember, she's already looked in this
Speaker 1: executive's email, but this is going further. Digging meant using
Speaker 1: that executive's access to look for more information. I have
Speaker 1: to imagine this was not what the executive had in
Speaker 1: mind when he wrote that password on the post it note.
Speaker 1: But again, I had been given somebody's access to everything
Speaker 1: that they had, So I'd like to point out that
Speaker 1: that's not actually a criminal offense. I looked through a
Speaker 1: bunch of documents and downloaded a bunch of documents because
Speaker 1: I just I knew that there was something horribly fishy
Speaker 1: going on, and I knew that something was going wrong.
Speaker 1: Joanna found some intriguing stuff. She found documents that said
Speaker 1: we Work was cutting way back on its profit projections
Speaker 1: by almost That meant that we Work had been way
Speaker 1: too optimistic about its future and now had to face reality.
Speaker 1: Joanna thought it was wrong that we Work wasn't telling
Speaker 1: its employees that its projections had been too rosy. They
Speaker 1: were having to constantly revise internal figures down because they
Speaker 1: weren't making as much money as they said they were,
Speaker 1: and employees did not know that. And bear in mind,
Speaker 1: employees technically are shareholders in the organization because they're all
Speaker 1: given equity. Let me make a quick as sign here. Yes,
Speaker 1: the employees are shareholders since they were given stock when
Speaker 1: they joined we Work. Generally, if you're a shareholder in
Speaker 1: a private company, you can get some information about its finances,
Speaker 1: more than is available to the public, but it's not
Speaker 1: a requirement that the company share it with you. All
Speaker 1: of this, the secrecy around the job cuts, the wasteful spending,
Speaker 1: the wildly optimistic profit numbers. This brought Johanna to a
Speaker 1: breaking point, and she felt she needed to make this public.
Speaker 1: And I thought, fuck this, I'm telling somebody, and I'm
Speaker 1: telling somebody because after everything I've seen, after all the
Speaker 1: ways in which I've seen people break their backs to
Speaker 1: be here, and so I thought, what's the worst that
Speaker 1: can happen? And obviously, the worst that can happen is
Speaker 1: it can get far fucking worse than you ever magic
Speaker 1: that can happen. But anyway, I say, what's the worst
Speaker 1: that can happen? And so I screenshot it, and I
Speaker 1: talked to a reporter, and that reporter was me, So
Speaker 1: now I have to pause again. Joanna shared internal recordings
Speaker 1: and documents with me in the summer. Of those tapes
Speaker 1: of we Works internal meetings that you hear throughout the series,
Speaker 1: those were given to me by Joanna. A couple of
Speaker 1: months after I met Joanna, I published a story about
Speaker 1: we Work slashing its profit forecast by almost eight He
Speaker 1: was one of the earliest stories to say that WE
Speaker 1: Work sometimes projected that it would make tons and tons
Speaker 1: of money, but that the reality was a lot more dismal.
Speaker 1: The story was widely read and picked up by several
Speaker 1: other outlets, and normally, because Joanna was a confidential source,
Speaker 1: I would never be naming her on my own. But
Speaker 1: some time has passed and Joanna said she wanted to
Speaker 1: share her whole story, identity and all. She felt that
Speaker 1: what she saw at WE Work and how they responded
Speaker 1: to what she did, tells a lot about what kind
Speaker 1: of company they are. Here's the thing. Joanna is kind
Speaker 1: of a polarizing figure. Many people think that what she did,
Speaker 1: accessing internal information and sharing it with a reporter is
Speaker 1: really wrong and hurtful to a company. Others might see
Speaker 1: her as a whistleblower who wanted to get the truth
Speaker 1: out about WE Work. I told people in two sixteen
Speaker 1: they were doing funny things with their numbers. I told
Speaker 1: people that, but I thought people would hold them accountable
Speaker 1: because they were big, that a lot of money invested.
Speaker 1: But it's not clear that people were ready to listen.
Speaker 1: And regardless of whether you think what she did was
Speaker 1: right or wrong, the things that happened to her next
Speaker 1: no reporter wants to see happen to a source WE
Speaker 1: Work came after her. Joanna is the first to admit
Speaker 1: that when she was downloading those internal documents, she wasn't
Speaker 1: the most careful about hiding her digital footprints. I all
Speaker 1: most never remembered to try to use a VPN to
Speaker 1: mask where I was. I don't think and ladies and gentlemen,
Speaker 1: if you ever decide you need to leak documents, I
Speaker 1: did not think about what the consequences would look like
Speaker 1: for me. We Work was able to trace the leak
Speaker 1: back to Joanna. Based on these clues, they knew she
Speaker 1: had the executive's password, and when they looked at the
Speaker 1: IP address that downloaded a lot of material, they could
Speaker 1: see that it was in her neighborhood within New York City.
Speaker 1: Joanna thought that speaking up would lead to more immediate consequences.
Speaker 1: It did have an effect, a big one, but not
Speaker 1: for we Work, for her. It didn't occur to me
Speaker 1: that everybody would brush it under the rug and then
Speaker 1: put my face everywhere and call me a criminal and
Speaker 1: a thief and a horrible person and someone who was
Speaker 1: out for for revenge. When my story came out, We
Speaker 1: Work sued Joanna the very same day. In the lawsuit,
Speaker 1: we Work alleged that Joanna stole the documents. They called
Speaker 1: it corporate theft. Being sued was terrifying. I cried a lot.
Speaker 1: I didn't sleep well. I felt like my world was collapsing.
Speaker 1: The lawsuit felt like such a punch to the chest,
Speaker 1: and the lawsuit was just the beginning. Joanna spent the
Speaker 1: next few years dealing with the fallout while the case
Speaker 1: went on. Because other news outlets picked up the story,
Speaker 1: so the first thing was is you couldn't google my name.
Speaker 1: I was unemployed and I was looking for employment, and
Speaker 1: you can't look for employment when if you google your name,
Speaker 1: the first thing that pops up is that Real Deal
Speaker 1: article with your face on it. So it was hard
Speaker 1: for me to get a job. Just to clarify, the
Speaker 1: Real Deal is a real estate news site which published
Speaker 1: a story with the headline we worked. Sues ex employee
Speaker 1: for allegedly leaking financial docs to Bloomberg. So yikes, And
Speaker 1: then she says the FBI got involved. On Monday, January seventeen,
Speaker 1: the FBI showed up at my door at eight p m.
Speaker 1: And I talked to them until and I talked to
Speaker 1: them until midnight. And my civil lawyer shit a brick
Speaker 1: when I told him that I talked to them, but
Speaker 1: I didn't have anything to hide. This was about six
Speaker 1: months after she was sued. They looked exactly like they
Speaker 1: came straight out of Central Casting, Like if you call
Speaker 1: the Hollywood and you were like, we need two guys
Speaker 1: who look like FBI agents. They showed right up. I
Speaker 1: was in the middle of washing my face and my
Speaker 1: husband was like, the Feds are at the door, and
Speaker 1: I was like, ha, He's like no, seriously, the Feds
Speaker 1: are at the door, and I was like what Joanna said?
Speaker 1: They were pretty polite and asked her a lot of
Speaker 1: questions about WE Work, she said. They asked her over
Speaker 1: and over again how she got the password, and then
Speaker 1: nothing came of it. In my experience reporting on these
Speaker 1: sorts of cases, that's kind of how it goes with
Speaker 1: FBI inquiries. They visit people's houses, they asked questions, and
Speaker 1: they never say exactly what for, and in the end
Speaker 1: the case might be filed or it might just disappear
Speaker 1: by the way. The FBI declined to comment on this.
Speaker 1: As for joanna civil case, it ended in an unexpected
Speaker 1: and quiet way as well. Joanna knew that WE Work
Speaker 1: had the resources to draw out a lawsuit which could
Speaker 1: bankrupt her. When she was trying to figure out what
Speaker 1: to do, a lawyer friend gave her a piece of advice,
Speaker 1: just don't show up. You don't have to pay a lawyer,
Speaker 1: and the judge will probably award WE Work a default judgment,
Speaker 1: which is kind of a standard amount of money she
Speaker 1: might owe the company based on some details of the case.
Speaker 1: And that was exactly what happened. But they in their
Speaker 1: lawsuit were demanding like untold sums of money and what
Speaker 1: they got was like with the default judgment, Joanna only
Speaker 1: had to pay back her severance, which was just one
Speaker 1: paycheck and some fees. It added up to a little
Speaker 1: over three thousand dollars, and oddly enough, We Work never
Speaker 1: collected the money and the window to do so closed
Speaker 1: in so Joanna paid them nothing and when the case
Speaker 1: was finally finished, she was hugely relieved. And I remember
Speaker 1: looking at it online and I'm We're looking at my
Speaker 1: husband and going, that has got to be the most
Speaker 1: anti climactic thing that's ever happened in my life when
Speaker 1: it started out as something that seemed like it was
Speaker 1: going to destroy my life. So that's the story of Joanna,
Speaker 1: the employee who in wanted to tell the world that
Speaker 1: we Work was struggling to hit its financial goals. What's
Speaker 1: interesting is that when my story came out, we were
Speaker 1: confirmed that the documents Joanna shared were real, but at
Speaker 1: the same time they dismissed what was in the documents.
Speaker 1: A spokesperson told reporters, our business is performing incredibly well
Speaker 1: and is stronger than ever. The stolen document was prepared
Speaker 1: months ago and does not reflect our robust operating momentum.
Speaker 1: By speaking out, Joanna wanted to tell the world that
Speaker 1: We Work was falling short of its own projections and
Speaker 1: was aware of it. The information that she put out
Speaker 1: there was a peek into we work shaky finances years
Speaker 1: before the rest of the world understood the full extent.
Speaker 1: Joanna thought that her actions would make a difference in
Speaker 1: how people saw the company, but they actually didn't, at
Speaker 1: least not right away. In hindsight, We Work shouldn't have
Speaker 1: been too worried. As far as I can tell, those
Speaker 1: stories about making less money than they expected didn't slow
Speaker 1: the company down. We Work continued to shoot upward with
Speaker 1: this almost unstoppable momentum. We'll be right back. The majority
Speaker 1: of we Work employees I've interviewed didn't come to the
Speaker 1: company skeptical. Many of them joined We Work thrilled about
Speaker 1: the new opportunity in front of them. And I was
Speaker 1: really excited. I mean, everything I had seen in the
Speaker 1: news was like hot and flashy and very exciting, and
Speaker 1: everyone I met at the offices was really cool, um,
Speaker 1: really good people. So I had just like a very
Speaker 1: excited feeling I was in the right place at the
Speaker 1: right time, and I think a lot of us felt
Speaker 1: that way. That's Tara Zoomer. She was thirty years old
Speaker 1: when she started at we Work. She was hired as
Speaker 1: an associate community manager. Her last job was working at
Speaker 1: an insurance company. Compared to that, we Work seemed like
Speaker 1: a thrilling opportunity. Tara also joined we Work in around
Speaker 1: the same time as Joanna. Her job was to help
Speaker 1: run a we work office building in Berkeley, California, and
Speaker 1: she felt lucky to get the job. She had heard
Speaker 1: story after story about early tech startup employees would become millionaires.
Speaker 1: When Tara joined we Work, it was only five years old.
Speaker 1: It was valued at five billion dollars at the time,
Speaker 1: and within just a few more months she watched as
Speaker 1: its valuation doubled to ten. It wasn't hard to imagine
Speaker 1: that this company was going to keep skyrocketing and carry
Speaker 1: her with it. It's like the Willy Wonka's Golden ticket.
Speaker 1: You know, you feel like you're you won already, and
Speaker 1: at some day you would be able to cash out
Speaker 1: and retire. You could pay off your student loans, you
Speaker 1: could buy a house, maybe you could relocate, you could
Speaker 1: go on more vacations. People were just excited, like really
Speaker 1: felt like they were going to dedicate as many years
Speaker 1: as it was going to take to see this through,
Speaker 1: to see what the possibilities were. Tara didn't know very
Speaker 1: much about equity, but she had heard stories of how
Speaker 1: it could transform people's lives. I mean, you hear the
Speaker 1: stories of people who missed out on like early Google,
Speaker 1: early Facebook. They're like tragic tales. So in our culture too,
Speaker 1: we already have those those stories and narratives, and it
Speaker 1: was a really easy thing for people to feel like
Speaker 1: they were in that place. Everything was pointing to you're
Speaker 1: in the right place at the right time. She started
Speaker 1: work and immediately her new job was hecnic. I could
Speaker 1: be doing something from like helping someone with the printer jam,
Speaker 1: I'm taking someone on a tour for sales. Then I'm
Speaker 1: setting up for an event, I'm shutting down an event,
Speaker 1: um someone's birthday. We're ordering them special stuff, like really
Speaker 1: anything that a building might need is what we would
Speaker 1: run around all day doing. Tara was an associate community manager.
Speaker 1: That's the title we work chose to describe the people
Speaker 1: who do everything to keep buildings running with clean conference rooms,
Speaker 1: fresh coffee and working internet. These positions had long hours.
Speaker 1: Tara was working evenings and she wasn't being paid overtime.
Speaker 1: Tara said that's because she was categorized as a manager,
Speaker 1: and managers are often exempt from overtime pay. But she
Speaker 1: says she wasn't managing any employees were making major business decisions.
Speaker 1: I was called a manager, and I don't think I
Speaker 1: was managing very much except like day to day simple operations.
Speaker 1: But the number of hours I was working started to
Speaker 1: be the real concerning point um because we're required to
Speaker 1: be at events. I'm leaving the office at nine, ten,
Speaker 1: eleven o'clock at night and just kind of getting that
Speaker 1: burnout pretty pretty early on. That lack of overtime pay
Speaker 1: was wearing on her. She was having a hard time
Speaker 1: living in the Bay Area on her salary, even with
Speaker 1: a job. She was going broke. Yes, seventy eight hours
Speaker 1: a week. That means you don't have time for any
Speaker 1: other income except for the one that you have. And
Speaker 1: for forty two thousand a year, I mean you take
Speaker 1: a chunk out for taxes, you take a chunk out
Speaker 1: for your insurance. For your rent in the Bay Area
Speaker 1: is really expensive and commuting back and forth to the city.
Speaker 1: What's left over is really not much. Um. All I
Speaker 1: knew is that I was exhausted working, I was going
Speaker 1: broke working, and that when I googled what like, I
Speaker 1: was on salary, and i just was curious about overtime
Speaker 1: because I'm like, I was calculating it out in some weeks.
Speaker 1: I mean, I'm making if you know, if I worked
Speaker 1: an eighty hour week at forty two thou a year,
Speaker 1: that's like it's like twelve bucks an hour. Like it
Speaker 1: really was starting to feel I feel really crazy. You
Speaker 1: might be wondering what about Tara's equity and we Work,
Speaker 1: what happened to that Willy Wonka's Golden ticket. Well, there
Speaker 1: are many degrees of separation between the equity that Tara
Speaker 1: got an actual money when she joined We Work. She
Speaker 1: wasn't given any equity outright. Instead, she was given something
Speaker 1: called stock options. Basically, this means that she had the
Speaker 1: chance to buy some shares in the future, but only
Speaker 1: if she stayed at We Work for at least a year,
Speaker 1: and even then she'd have to buy these share with
Speaker 1: her own money. This is pretty standard in the tech industry.
Speaker 1: So even though there's that glimmer of hope that this
Speaker 1: equity could be worth a lot someday. It's definitely not
Speaker 1: cash in the bank. It's more of a dream. After
Speaker 1: just a few months on the job, Tara was starting
Speaker 1: to think that she wasn't a manager, and neither were
Speaker 1: the other community managers and WE work buildings all over
Speaker 1: the world that could be hundreds of employees, and she
Speaker 1: questioned whether they were all owed overtime paying. I was
Speaker 1: questioning our classification as salary exempt workers and finding legal counsel.
Speaker 1: And my hope actually was that UM, I wouldn't just
Speaker 1: be able to help myself, but that I would actually
Speaker 1: be able to help all community managers everywhere. Around that time,
Speaker 1: community workers made up more than half of WE Works employees.
Speaker 1: A lot of Silicon Valley companies choose titles that are
Speaker 1: vague or new fangled, like calling human resource people operations,
Speaker 1: but in Tara's case, the fact that we Work said
Speaker 1: she was a manager was stopping her from getting paid
Speaker 1: for extra work. She started talking to her coworkers about
Speaker 1: what she was looking into UM and shortly after that,
Speaker 1: I had a manager confront me in a meeting, and
Speaker 1: in that meeting she told me I should stop talking
Speaker 1: to people about their rights because their path is their path,
Speaker 1: and I should let everyone discover it on their own. Um.
Speaker 1: And she told me that my talks were negative to
Speaker 1: the work environment, like me bringing up these labor issues
Speaker 1: is really negative to the work environment. Um. And then
Speaker 1: she asked if I wanted to resign yeah, which I
Speaker 1: said no. She was told that just asking these questions
Speaker 1: was really negative to the work environment. It just strikes
Speaker 1: me as something pretty hostile to say to someone who's
Speaker 1: asking about their rights. It makes it sound bad and shameful.
Speaker 1: And soon after that, Tara was fired. It was because
Speaker 1: she didn't want to sign a new employee agreement that
Speaker 1: we Work introduced in all their offices. She was put
Speaker 1: off by a clause that she noticed, saying that any
Speaker 1: claim she wanted to bring against the company would have
Speaker 1: to go through a private dispute process called arbitration instead
Speaker 1: of going through the court system. I refused to sign
Speaker 1: this document, and then I was terminated. And how did
Speaker 1: you feel? Just shocked. I didn't know that a company
Speaker 1: had the ability to make me choose between my job
Speaker 1: or my rights. In the midst of all of this,
Speaker 1: she sent an email to hundreds of her coworkers. The
Speaker 1: subject line was your rights at WE Work. I asked
Speaker 1: her to read the letters. She wrote, Highway work as
Speaker 1: a part of a community of people I love. It
Speaker 1: feels strange to be addressing you all at once, but
Speaker 1: this is important here in California and across the company.
Speaker 1: We received new employee paperwork to sign. I have refused
Speaker 1: to sign these documents. I am in the process of
Speaker 1: filing a wage dispute with WE Work and will not
Speaker 1: give up my rights to a jury. If you would
Speaker 1: like to understand more about what you were signing, review
Speaker 1: them with a lawyer. It is important that you know
Speaker 1: your rights best Tara. So then Tara sued WE Work
Speaker 1: for wrongful termination and unpaid wages. It was the first
Speaker 1: we Work employee lawsuit that I wrote about. Tara hadn't
Speaker 1: been at WE Work for a year, so she didn't
Speaker 1: get any equity. This was in we Work has since
Speaker 1: made a few changes about how they pay employees. They
Speaker 1: gave a small pay bump for community workers and offered
Speaker 1: some employees limited overtime, but it's unclear if community managers
Speaker 1: are included in that group, and the company has never
Speaker 1: admitted to misclassifying Tara or her colleagues. I want to
Speaker 1: be clear that Tara wasn't an exception. She represents this
Speaker 1: big group of we Work employees, the community staff, who
Speaker 1: were the ones on the front lines of this growing company.
Speaker 1: They were putting in the labor day after day to
Speaker 1: run we Work offices all over the world. In many cases,
Speaker 1: the community staff were the only we Work employees that
Speaker 1: customers ever interacted with. Despite all of this, community workers
Speaker 1: often got the short end of the stick at we Work.
Speaker 1: A former executive even told me that they sometimes felt
Speaker 1: bad for the community team. The executive brought up incidents
Speaker 1: of customers getting aggressive at the community staff and refusing
Speaker 1: to pay their bills. The exact also said that one
Speaker 1: community worker even found a gun in the bathroom and
Speaker 1: have to figure out what to do with it. These
Speaker 1: jobs were essential to the company, but also difficult and
Speaker 1: unpredictable with low pay. Tara is also an important person
Speaker 1: in the history of we Work. She was one of
Speaker 1: the first people to speak out publicly against the company,
Speaker 1: which remember was one of the most well funded startups
Speaker 1: in Silicon Valley. I remember reading about her case just
Speaker 1: as I was starting to cover the company it was
Speaker 1: fascinating to me. We Work proclaimed to be about having
Speaker 1: each other's backs and being better together, but here this
Speaker 1: employee saying that many of its staff felt overworked, underpaid,
Speaker 1: and exploited. These lawsuits are far from the only ones
Speaker 1: we Work has dealt with over the years. The company
Speaker 1: has been hit with other serious allegations. One ex employee
Speaker 1: said that she had been groped and sexually assaulted at
Speaker 1: we Works Big Parties, Summer Camp, and Summit by two
Speaker 1: separate colleagues. We Worked disputed this. In fact, we were
Speaker 1: Co founder Miguel McKelvey wrote an email to all we
Speaker 1: Work staff, calling this employees allegations merit lists and saying
Speaker 1: that she was a poor performer. Another ex employee claimed
Speaker 1: that we Work systematically paid men more than women for
Speaker 1: similar work. A third alleged racial discrimination. Still another person
Speaker 1: said he was pushed out of his job for being
Speaker 1: too old. All of the cases are either pending or settled.
Speaker 1: We Work said these claims are without merit. It's worth
Speaker 1: taking a moment to consider Tara and Joanna's stories side
Speaker 1: by side. They both took big risk because they wanted
Speaker 1: to change the narrative around We Work, but back in
Speaker 1: neither could really change we Works trajectory. The company's momentum
Speaker 1: at the time was just too strong, and as you'll
Speaker 1: hear in the next episode, We Work didn't slow down
Speaker 1: at all. In fact, things just got more over the top.
Speaker 1: Adam was handed billions of dollars and told you have
Speaker 1: to be crazier, make it ten times bigger, and he
Speaker 1: took it to heart. That's next time on Foundering. Foundering
Speaker 1: is hosted by me Ellen Hewitt. Sean When is our
Speaker 1: executive producer. My Aquava is our associate producer. Ray Mondo
Speaker 1: mixed the show today. Mark Million and Vander May and
Speaker 1: Alistair Barr are our story editors. Francesco Levi is the
Speaker 1: head of Bloomberg Podcasts. Be sure to subscribe and if
Speaker 1: you like our show, leave a review. Most importantly, tell
Speaker 1: your friends see you next time. At the bar of
Speaker 1: the part