Workday to cut around 400 employees

Workday Inc. plans to cut about 400 jobs, mainly in customer support roles that do not directly generate revenue, according to a regulatory filing.

The layoffs, representing about 2% of its workforce, are expected to result in US$135 million in charges in fiscal Q4 ending in January.

The company, which develops software for business management, had around 20,600 employees as of October.

The move comes amid industry-wide reevaluation of staffing, particularly in customer support, as AI tools are seen as potential efficiency enhancers.

Workday previously announced a larger workforce reduction about a year ago to focus on hiring in areas like AI.

The company’s stock has declined 34% over the past year, closing at US$170.15 on February 4 in New York.

🔗 Source: Bloomberg

🧠 Food for thought

Implications, context, and why it matters.

Workday links its customer support reorganization to AI efficiency, yet it is also dealing with a legal fight tied to its hiring software.
A federal class-action case claims the company’s algorithmic hiring tools discriminate, with a possible disparate impact on applicants age 40 and older 1.
A court let a claim move forward that Workday could be directly liable as an “agent” of its customers, a new approach that could raise risk for AI vendors 2.
Court filings say 1.1 billion applications were rejected using Workday software in the relevant period, which could widen the case as the company leans further into automation 3.

Roughly 400 customer support layoffs sit inside a broader reshaping of roles at Workday.
About a year ago, Workday said it would cut about 1,750 jobs, or 8.5% of staff, to redirect spending toward priorities that include AI 4.
The plan includes building “AI agents” (software that can autonomously execute tasks and workflows) for human workers, which Workday sells as an edge over rivals 5.
Workday research found 83% of business leaders say AI raises the value of human skills such as ethical judgment 6.
Across the industry, automation can remove roles that software can absorb, while employers race to hire people who can run and ethically supervise these systems.