TikTok Restructures E-commerce Team, Resulting in Layoffs

In a move to reorganize part of its e-commerce operations, TikTok announced today it is letting some of its American e-commerce employees go. This decision, as revealed by five of the company's personnel to Business Insider, involves adjustments in the governance and experience division.

Known as GNE, the governance and experience division operates on a global scale. It ensures the safety of the TikTok Shop marketplace for shoppers, sellers, and content creators. Responsibilities of this group include enforcing seller rules, overseeing product postings, and safeguarding intellectual property rights.

Despite inquiries from Business Insider, details about the number of employees affected remain undisclosed.

When approached for a statement, a spokesperson from TikTok opted not to provide any comments.

Challenges for TikTok's E-commerce Sector

This year, TikTok's US e-commerce department has faced scrutiny from its international leadership, largely due to unmet performance benchmarks related to goals set for 2024. During a company-wide meeting in February, Head of Operations Bob Kang addressed the team, as Business Insider previously noted. Subsequent performance reviews in March yielded low evaluations for some, resulting in initiatives for performance improvement or severance departures.

The current dismissals join an earlier set of layoffs in February, which targeted TikTok’s global trust and safety segment. This team’s duties extend to moderating content across a wide range of user-generated media, beyond shopping-centric materials.

Impact of International Law and Trade

The reductions arrive at a time when TikTok navigates the implications of a mandate from 2024, requiring ByteDance to divest ownership of TikTok’s US operations. Initial compliance failure led to a temporary shutdown of the app domestically. However, subsequent orders from President Donald Trump directed the Attorney General to halt enforcement.

This week, Trump disclosed that TikTok was nearing compliance over divestment demands, but ongoing trade tensions, specifically new US tariffs on China, disrupted progress. Both the Chinese and American governments would need to endorse any resulting agreements, positioning TikTok as a potential element in broader trade discussions.

A representative from ByteDance informed Business Insider that talks with US officials are ongoing, seeking a resolution for TikTok's American operations. Nonetheless, any agreement remains contingent on the concurrence of Chinese legal authorities.