Health

SoulCycle Is Quietly Furloughing Its Staff and Cutting Their Pay

The company maintained a sunny social media presence while instituting the changes, which have not been publicly announced.
April 1, 2020, 5:32pm
An image of SoulCycle studio's storefront windows
Image via Getty.

SoulCycle, the fitness studio known for pricey classes and cult-like devotion from its attendees, has quietly begun instituting 25 percent pay cuts for many of its employees and furloughing others, VICE has learned. The company closed its studios in the U.S., Canada and the UK in mid-March in light of the COVID-19 pandemic, but has continued a cheery roster of Instagram and other social media posts, highlighting individual instructors, shoutouts to its SoulCyle “fam,” and reminders to practice self-care. The furloughs and pay cuts have not been announced publicly. A spokesperson for the company did not provide specific numbers to VICE, but an internal memo addressed to the “SoulFam” suggests the changes affect virtually every employee at its roughly 98 studios worldwide.

An emerging labor story during this pandemic is about how companies who have always branded themselves as transparent and radically ethical, like Everlane, or more like a “family” or a community, like countless others, treat their employees during a straitened time. It’s also about how they clearly or transparently communicate that treatment to their customers. In the case of SoulCycle, the company has long turned its instructors into minor social media stars and brand ambassadors for the company, encouraging a sense of closeness between riders and staff.

Furloughs, layoffs, and pay cuts are common business moves at this time. (VICE, for instance, announced to employees this week that it would institute graduated pay cuts for some top-earning employees, stop matching employees’ 401ks, and freeze promotions for at least 90 days.) How abruptly or cryptically those changes are communicated can be a source of panic and stress, however. A freshly furloughed SoulCycle staffer from the Bay Area told VICE that the company had been “vague” both publicly and privately about how the company would compensate its employees while the studios are indefinitely closed.

“During our first call with the senior leadership, they talked about how our business was in a strong place because of the upcoming Big Sale”—a yearly event that’s currently underway—“as well as the launch of pre-orders of the Soul at-home bike,” the furloughed employee told VICE. (They were granted anonymity so as to freely discuss a sensitive work situation.) “They then backtracked [on Monday, March 30] and split everyone into four buckets that included three separate pay cuts and one group (basically the entire front line) being furloughed.” (The at-home bike is a project with Equinox Media, a $2,500 bike and streaming exercise class “experience” intended to rival Peloton.)

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The internal memo from SoulCycle was signed by Sunder Reddy, the interim CEO of the company after former CEO Melanie Whelan stepped down in late November. It states that for the next 30 days, active full-time employees who are still able to work will be paid 75 percent of their base pay, as will some employees working reduced hours and some who are unable to work due to the studio closures. The fourth category of employee are those who are furloughed without pay for the next 30 days; the furloughed staffer we spoke to estimated that many studio employees would probably fall into that category, including front desk staff and assistant studio managers, while instructors and studio managers were likely all kept on with reduced pay.

The internal memo also signaled that SoulCycle is also planning layoffs for later this week, with Reddy writing, “[W]e still have a few considerations that may impact a small number of people. These aren’t easy decisions to make, but we’ll reach out to that small number of people on Friday.”

The furloughed staffer tells VICE that they’re in a marginally better position than many other Soul employees, given that they have a second job.

“I’m very disappointed and still upset, though,” they added. Just six days ago, they watched as SoulCycle’s main Instagram account posted a photo of the Westchester, New York staff sending well wishes to everyone. “Now that team is essentially all furloughed. That sent a false message of hope to other staff knowing now what happened, and it tries to make it seem to riders that staff are being taken care of when they were potentially planning the layoffs. It seems like they’re being very strategic from a marketing perspective and it’s honestly makes me pretty angry.” The caption of the post read, “Even though we’re away from the studio, the love keeps flowing.”

The company’s last major controversy came in August 2019, when it was revealed that Stephen Ross, the CEO Related Brands, which owns SoulCycle as well as Equinox, has been a major Trump backer and fundraiser. Ross’ net worth is estimated at $7.7 billion.

A SoulCycle spokesperson at Derris—the same public relations company used by Everlane—told VICE in a statement that in order “protect our teams… yet remain in the strongest position to reopen our studios globally,” the company had to make “difficult decisions that impact individual roles and payroll at all levels of the organization.” The statement also calls SoulCycle employees “the core of everything we do.” Their full statement reads:

In an effort to protect our teams in the wake of Covid-19 pandemic yet remain in the strongest position to reopen our studios globally, SoulCycle has had to make a number of difficult decisions that impact individual roles and payroll at all levels of the organization, including implementing pay reductions and furloughs for employees unable to work due to studio closures. Our people, who bring this brand to life every day for our riders and our communities, are at the core of everything we do. Through these actions, we are able to continue to compensate the majority of our workforce with as minimal a reduction in pay as possible, while continuing to provide health benefits and access to mental health services to all employees enrolled.

On Wednesday morning, SoulCycle still had not announced the staff changes publicly, but did post a spicy astrology meme.

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This article originally appeared on VICE US.