A surprise cosmetics company is letting go of 100 jobs because it wants to change the way it does business, according to a news release.
The changes were made public on Monday by Rodan and Fields, a company that cares for hair and skin.
As of September 1, the company will no longer use a multi-level direct selling plan.
Shopping Dive says that current Rodan and Fields consultants will join a new affiliate scheme.
The brand will no longer make money by giving commissions to people who bring in new customers.
Besides that, the company has changed its business structure and cut about 100 jobs.
Rodan and Fields has backed away from its multi-level marketing plan because, as the company says, it wants to make things easier and reach more people.
This time, the brand will help its consultants by marketing and promoting on both traditional and social media channels.
The company says that over 90% of consultants will have “higher earning potential based on their current sales performance” because they will get higher commissions on sales and discounts on products.
“We are confident that these changes will allow us to meaningfully expand the lives we can impact and, most importantly, allow us to continue to provide our passionate Consultants with a modern and meaningful way to make money,” Rodan and Fields CEO Dimitri Haloulos said in a statement about the changes.
A class action case was recently filed against the company and its founders in California over how its consultants were classified.
It said in its filing that Rodan and Fields took advantage of its California sales staff by misclassifying them as contractors instead of workers.
In the lawsuit, it was also said that one-third of its experts did not get paid for their work in 2022.
When asked about the lawsuit or new questions about the change in business plan, Rodan and Fields declined to say anything.