According to an announcement by the DistroKid Union, DistroKid plans to lay off approximately 15% of its workforce on November 2nd.
The cuts will impact 37 employees, including 5 of the 7 members of the bargaining committee between DistroKid management and the Union. No non-union employees have been notified of layoffs at this time.
The DistroKid Union revealed the layoff plans over the weekend on Instagram, claiming the move affects half the unionized staff. In a statement, the Union alleges the company intends to “replace [the positions] with overseas labor” in a bid to save a few million dollars – less than 0.2% of DistroKid’s $1.3 billion valuation.
DistroKid employees voted to join the New York-based National Association of Broadcast Employees and Technicians union (NABET-CWA) after an intense anti-union campaign by company leaders. According to the Union, DistroKid president Michael Dunau sent multiple letters urging workers not to unionize.
Nonetheless, workers voted 45-28 in favor of unionizing. NABET-CWA has since accused DistroKid of failing to negotiate in good faith, as management allegedly does not want union observers present during bargaining sessions.
The layoffs will impact DistroKid’s customer service teams, which help independent artists distribute and monitor sales of their music. In a statement, DistroKid claimed the cuts are meant to “enhance support for artists by expanding to 24/7 service with faster response times.” However, the move has angered union members.
DistroKid, which distributes an estimated 30-40% of new music releases globally, raised $65 million in a Series C funding round led by Insight Partners. The round valued the company at $1.3 billion. However, it seems unrest among union workers could threaten DistroKid’s reputation for prioritizing independent artists.
