Shopify fired a “single-digit number of salespeople” for faking revenue projections to increase their commissions, according to a report by The Logic, which cited unnamed sources.
For over a year, the salespeople inflated projected sales figures of brands they'd onboard by “tens of millions of dollars” because their commission structure was based on the projected annual sales of each merchant they brought to the platform. However as time went on, Shopify saw that the new merchants failed to deliver the numbers projected by its sales team and eventually caught wind of what was going on.
Shopify's head of external communications Ben McConaghy told The Logic:
“We immediately investigated, fired them, and strengthened our systems. This had no impact on our financials and this issue is closed.”
Following those fraud-related cuts, Shopify made additional layoffs last week across managerial roles including merchant success, operations, sales, and account executive teams.
Regarding those layoffs, McConaghy said:
“This impacts a fraction of a percent of our team, keeping us fast, sharp, and focused on long-term merchant success.”
In Ontario, where Shopify is partially headquartered, regulations require longer notice periods for employees affected by mass layoffs impacting more than 50 workers, but it's currently not clear if these recent cuts meet that criteria.