After initially posing a round of voluntary buyouts to employees in April, Rocket Companies has offered a second round of buyouts to employees in “a select number of business areas” within its structure.
Detroit-based Rocket Companies is the parent company of lending giant Rocket Mortgage and title arm Amrock, among other businesses. Roughly 8% of employees across the two companies, most of them concentrated within the Rocket Mortgage operations team and several other teams within Amrock, were extended elective buyouts during the original offering. Just like those offered during the first round, Rocket Companies chief administrative officer Mike Malloy characterized the buyouts as a “completely optional plan,” adding that Rocket reinstated the buyouts after more workers requested their return.
With the housing market normalizing after a period of historic demand, Malloy acknowledged the reality that the current mortgage environment is limiting career growth within certain areas of Rocket’s business.
“As a result of today’s market, some team members have told us they are considering a move to another position or a completely different industry, and have asked that we reinstate our career transition incentive, first offered earlier this year,” he said.
The package included in the buyout includes several months of salary; continuation of medical, dental and vision benefits through 2022; payment for a portion of accrued time off; and career transition service, including job-search assistance.
Rocket’s optional program contrasts with several recent mass layoffs across the mortgage industry in which large swaths of workers were terminated via digital meetings. Jay Farner, CEO and vice chairman of the board for Rocket Companies, asserted in a recent earnings announcement that “we’re not going to have a conference call where, all of a sudden, we let a group of [employees] know they’re not going to be working here any longer. That’s just not how we do this.”
Still, despite Rocket’s large footprint and market share, the company isn’t sheltered from the steep contraction in mortgage origination volumes and is now grappling with downscaling concerns. Rocket reported $60 million in profits during the second quarter of this year, down from more than $1 billion in Q2 2021, and indicated that it had slashed expenses by $300 million during Q2 2022, in large part due to the April buyouts.