Bench Cuts Staff After Acquisition, While Workforce Remains on Rolling Contracts

Discover top fintech news and events!

Subscribe to FinTech Weekly’s newsletter

Read by executives at JP Morgan, Coinbase, Blackrock, Klarna and more

Layoffs Follow Months of Post-Acquisition Instability

Accounting and tax fintech company Bench has carried out a round of layoffs that impacted multiple departments, including client success and tax services. The move comes just months after the company was acquired out of financial distress in a $9 million deal by HR tech firm Employer.com.

Although the company did not disclose the number of employees affected, internal estimates suggest that the cuts involved dozens of staff — a notable portion of the roughly 300 people employed at the time. Sources familiar with the matter said most of Bench’s U.S.-based tax advisory team was among those let go.

Employer.com said the decision was difficult but necessary as it continues efforts to restructure the business. The firm stated that the cuts reflect operational challenges inherited from Bench’s prior ownership, rather than a broader outsourcing strategy.

Legacy Issues Persist Under New Ownership

Bench was previously backed by over $110 million in venture capital and an additional $50 million in debt but failed to reach profitability. In late 2023, it abruptly shut down operations, laying off its staff and leaving thousands of customers without access to their financial records. Employer.com acquired the company shortly after, rehiring most of the workforce and pledging to stabilize and rebuild the business.

However, multiple current and former employees have indicated that conditions remain uncertain. Much of the workforce is still operating as independent contractors, with contracts renewed monthly rather than being converted into full-time roles. At the time of acquisition, this arrangement was described as temporary. Months later, it remains the default structure.

Internally, Bench has signaled a long-term plan to shift the majority of its workforce outside North America. Employer.com, however, denies that recent layoffs are part of a strategic relocation initiative, instead attributing the decisions to ongoing restructuring efforts and customer base reevaluation.

Customer Attrition and Tax Filing Challenges

The staffing changes coincide with customer churn, some of which occurred after the U.S. tax filing deadline on April 15. According to individuals familiar with Bench’s operations, a number of clients left the platform due to incomplete or delayed tax filings. Others reported billing frustrations, claiming they were charged for services already paid for before the company’s acquisition.

Bench has responded by stating that it honors all prepaid services and that the uptick in customer departures is, in part, intentional. The company cited legacy pricing structures that led to some customer accounts being serviced at a financial loss.

Employer.com explained that the decision to discontinue support for unprofitable accounts was part of a broader effort to realign the business toward sustainability. Leadership has emphasized that these steps are meant to address past inefficiencies, not to curtail future growth.

Month-to-Month Contracts Signal Provisional Operations

The continued use of month-to-month independent contractor agreements reflects the company’s ongoing transitional status. Employer.com has said it is exploring longer-term employment solutions, but has not committed to a specific timeline.

The contractor model was introduced to expedite onboarding after the acquisition, according to internal communications. Yet for many of those working under this structure, the lack of job security has raised concerns about long-term viability, team cohesion, and operational consistency.

This approach stands in contrast to typical fintech staffing models, which often emphasize long-term retention and internal knowledge-building, especially in regulated service areas such as tax support.

A Test of Turnaround Execution

While Bench’s new parent company has laid out plans to grow both product features and headcount, the recent developments underscore the complexity of reviving a fintech business that faced a total shutdown less than a year ago.

The original shutdown left a gap in service for many customers and eroded trust — particularly among those relying on timely tax preparation and ongoing bookkeeping. Rebuilding that trust while executing a restructuring strategy presents a significant challenge for Employer.com and Bench’s remaining leadership.

As the company adjusts its pricing, workforce structure, and service model, its ability to retain customers and stabilize operations will likely determine whether this recovery effort results in a true turnaround — or another setback.