Morning Briefing
Summaries of health policy coverage from major news organizations
Zenefits Lays Off Nearly Half Of Its Remaining Workers
Zenefits is laying off nearly half its staff as the software startup grapples with the fallout of insurance violations that resulted in hefty penalties from state regulators. The company, which offers free human-resources software to manage benefits and payroll while making its money as an insurance broker, said on Thursday that 430 employees would lose their jobs. That leaves 4-year-old Zenefits with about 500 employees, roughly a third of what it had a year ago. (Somerville, 2/9)
In a memo to staff, the company鈥檚 new chief executive, Jay Fulcher, wrote that 鈥渋n 2015, the company grew too quickly, hiring employees to support revenue projections that far surpass where we are today. Today鈥檚 action aligns our costs more closely to our business realities.鈥 (Winkler, 2/9)
Zenefits faced accusations that it allowed unlicensed employees to handle insurance transactions and failed to meet insurance agent education requirements. It eventually paid $3.7 million to settle the charges. (Livingston, 2/9)
