Mitel Initiates 'Devastating' Pre-Holiday Layoffs Due To RingCentral Partnership

A number of high-ranking Mitel workers have lost their jobs just before the holidays prompted by the company’s new partnership with RingCentral.

On LinkedIn, Richard Fry, national channel manager, announced his departure from Mitel just before Thanksgiving. And Earl Stevenson on Friday announced his departure. He was head of Mitel’s network operations center (NOC) and global incident management.

Both cited the RingCentral partnership as the reason for the layoffs

Last month, RingCentral announced its strategic partnership with Mitel. The partnership will provide Mitel’s global customer base with a migration path to RingCentral’s Message Video Phone (MVP). That’s RingCentral’s cloud phone system.

With this partnership, RingCentral becomes the exclusive UCaaS partner for Mitel. MVP will integrate with Mitel’s CloudLink technology. That will provide Mitel’s user base of more than 35 million with a path to MVP.

As part of the Mitel-RingCentral partnership, RingCentral will pay Mitel $650 million to acquire intellectual property rights and patents covering network and call management, security and infrastructure. In turn, Mitel’s investor group led by affiliates of Searchlight will invest $200 million in equity in RingCentral.

Restructuring Under Way

Mitel said it continually assesses its resources and operational structure. It does so to ensure it’s “best-positioned to support our customers and address market opportunities.”

“We are restructuring select teams and organizational resources following our announcement to deliver UCaaS cloud offerings exclusively through our partnership with RingCentral,” it said.

Mitel said it is providing severance packages and resources to all affected employees. In addition, RingCentral is interested in interviewing impacted Mitel employees.

“We are not disclosing specific figures at this time,” it said. “The restructuring effort is focused on select functions as we are now exclusively partnered with RingCentral to deliver UCaaS cloud offerings to the market. We are not offering further specifics.”

Worst Time for Layoffs

Stevenson joined Mitel in April 2020.

“My current company Mitel this week announced a reduction in force (RIF) as a result of its new partnership with RingCentral,” he said. “Unfortunately, this could not have come at a worse time with its two-week severance package and total loss of health insurance for my family. I am a husband and father of seven beautiful children (four boys and three girls). One just returned from combat operations in Iraq. On top of that I have already lost two siblings and my mother this year.”

Stevenson said being told of the layoffs was “devastating.”

“I have extensive servant leadership experience in NOC, network operations, service assurance and managed services leading small to large teams globally, and always dedicated to exceeding customers expectations and to my teams,” he said. “Hopefully, this will still turn out to be a good Christmas for my family. I am the breadwinner for my family and I’ve always been there to support them and take care of them until now.”

Fry had been with Mitel for nearly four years.

“I’m not sure what is going to come next,” he said in his LinkedIn message. “But I am thankful to work in this channel and to be associated with so many wonderful people in this business.”

Peter Radizeski, founder and president of Rad-Info, said with Mitel “killing off MiCloud and going hardware-only, layoffs were inevitable as they re-shape the company to be hardware only.”