I was originally hired by this Japanese startup as COO in 2020. Last year I noticed people around me suddenly stoped addressing me as COO and instead team leader. Finally confronted the CEO about this as I ran out of business cards and ordered new ones and he didn’t want to write COO on these this time. When I confronted him he said he wants to stop addressing all C class employees as such until next year after the next seeding round when he’ll want to fill all the remaining C class positions. At that time if I prove myself I may be chosen as COO again even though that’s been my title and it’s in my contract for years.
It also sounded that they could just get someone else next year for the position altogether likely a Japanese person which they probably prefer. Note that there is no other C class employees aside the CEO and CFO both whom are founding members and me.
Should I resign? For my career it’ll look like I got demoted if I I go along with it (even though the ceo swears it’s not a demotion and at least my contract is not changing, it’s more an internal reorganization), plus in principle it feels wrong and I don’t think they can legally do that but I’m not sure.
Having said that I have no mental and emotional energy to go to war with the boss and may as well quit and go elsewhere.
What should I do?
Edit: my contract stated I’d receive x amount of stock options on early 2021 but the ceo hasn’t gotten organized and distribute them among the employees. It’s been really the carrot on the stick. Guess it’s another red flag. So what happens with these? If I walk I lose my right to them?
34 comments
No, it won’t look like you have been demoted. You *have* been demoted. Only you are obviously the last to know.
I would go elsewhere
You were demoted a year ago and you just found out. Did your pay take a hit too?
Unfortunately, your boss clearly wants you out of that role and is taking a roundabout approach to avoid confrontation.
>At that time if I prove myself I may be chosen as COO again even though that’s been my title and it’s in my contract for years.
>
>even though the ceo swears it’s not a demotion and at least my contract is not changing, it’s more an internal reorganization
Don’t agree to any of this, especially if it’s in your contract.
Contractual terms and conditions cannot be changed without the employee’s permission unless specifically stated.
At first I was thinking, “mega-inflated title to begin with”. Then I noticed you are a startup going through a funding round. So, what is your situation wrt equity, and, could the drop from C-level be related to that? Alternatively, do the investors want to install a COO – that’s real possibility.
You have a contract.
Rake the entire company over the coals. Your CEO is a coward and the company is a sinking ship because of that. Make their lives miserable and enjoy every second of it until they offer you a severance.
If you’re not the type to enjoy this kind of thing, I wouldn’t recommend it, but this is the kind of bullshit they pull at the very top, where very little work is actually done and it’s all about politics.
What people “around you” started addressing you differently? Everyone? Because it seems like they had a meeting you didn’t take part in where this was discussed. Be careful about signing contracts with the new title.
Point out that your new title comes with a 20% pay rise.
On possible interpretation: the CEO knows that to get the next round of funding he will may have to hire a COO that the investors want and that will not likely be you. He is being cagey because he does not actually know if this will be required and would actually like you to continue in the role but he has to hedge his bets.
You need to decide if you like working for the company and the CEO. If you do then you need to see if you can get the CEO to acknowledge that this is the issue and but explain how the apparent demotion is an issue for you. If you don’t like the company and CEO then start looking for another job.
Sounds like the Japanese way of saying your out (atleast for that role)
If it decreases your payroll, then look somewhere else. Or else continue
They’re battening down the hatches for their series A — unlikely it’s another seed. They hired you (probably under market value) with a lofty title when they were 2 scrappy founders, and needed someone high skilled. I’m guessing you were their first skilled hire? If you think they’re gonna reinstate your title as COO next year, well I got a bridge up north in need of a buyer. You’ve been had, bro.
They want to have some “proper” names in place (take from that what you will), before they go out for a new round. I’m gonna guess they are first time founders, and of course equity stingy. I’ve seen this happen many times. Do you even have any equity? Gonna guess no?
* Review your contract: If your contract specifies your role as COO, then the company can not just arbitrarily change your title without giving you a new contract.
* Polish off that resume: Be ready to walk. Once it’s viable, leave WITH the COO title. Who cares who they hire after you.
* Lawyer Up: Be ready to have a good employment lawyer to contact. The company sounds shady as hell, and the CEO has obviously been talking behind your back. You have been unofficially demoted — you’re just the last one to know it. Also, the CEO sounds weak asf. Doesn’t bode well for the company.
Yeah, this is a lawsuit waiting to happen.
I would ask for a massive severance package.
I believe the best course of action is to raise a big stink about it and let other employees know what kind of boss this person is. While doing this, prepare to leave (find new job prospects). If your boss is going to be a dick and try to force you out of your position, you might as well make his life a living hell.
I am not sure how your startup operates or how early stage yours is, but usually for promoting/demoting C-level, there will be meetings (could be board or shareholders meeting) to decide that. The existing C-level will remain during the seeding round but will/may change if there’s request from the new shareholders. Again, there will be meetings to decide that. They cannot just tell you casually that you’re no longer a COO. If I were you, I’d ask for the minutes of such meetings (if there’s any) or I’d just look for another job .
For your own edification, I’d assess whether you are a shitty COO or not. I’d also take that title somewhere else, before it becomes a team lead. If you really want to be a COO, that is.
I don’t see investors demanding a COO at such an early stage, but they may be telling the founder the company doesn’t need one so early, which may be valid.
Either way, your communication with your CEO sounds problematic. You should be his right hand person. It sounds like you don’t know what he’s thinking, which isn’t good. Good luck, maybe I’m wrong.
Quitting is what the company or CEO wants you to do.
Since you seem like you are ready to leave, consulting a lawyer who practices labour law is highly advised, especially if your salary has been affected. Companies have a tendency of asking for resignation once lawyers are involved
Changing of positions isn’t highly irregular in Japan as long as it’s reasonable. Good idea to look over your employment contract.
From the info available, it doesn’t appear to be constructive dismissal. If your role and responsibilities drastically changed then you may have a case, but that could be an uphill battle.
Unfortunately, it doesn’t sound like you can trust some or most of the people you work with so I would keep that in mind and be mindful what I say around them.
Acting fast is also advised because you won’t have much of a case if you have been called team leader for months and you went along with it.
It is a nuisance and dreadful. An easier path is always tempting. It is your decision. Godspeed.
>But the ceo hasn’t gotten organized and distribute them among the employees.
If you are not on the captable, you are not on the captable.
That means you are a salaried employee and have no equity in the company.
your boss is probably looking who’s in for career progression or a faithful soldier
Unfortunately, your hunch is correct. He’s trying to remove you. First, you’ll need to continue doing your job as normal, don’t let the title change get to you. In the mean time, start finding another job discreetly and at the same time, enforce the contract on your boss to pay out the stocks you are owed. Don’t directly threaten him with taking legal action but say that if you don’t get the stocks owed to you in a reasonable amount of time, your hand will be forced to take legal action. The goal is to get your stocks.
But before taking any action, take some time and reflect on your work history. Has there been any major changes around the company, personal changes, relationship changes, things of that nature to make sure your making the right move. Talk to a close trusted friend about your problems at work. There might be a chance your overlooking something that wasn’t apparent to you at first. After taking some time to reflect and believe you’ve come to the right answer, then stay with it. Best if luck to you. It’s a hard world out their.
The positive approach would be to simply focus on how you found out and how that can improve in the future while being graceful with what is surely a painful situation
Leadership is highly valued when searching for work
Engage an employment lawyer and hold them to the contract. Don’t make it a big deal publicly, remain professional, and you’ll come out of it as well as you can.
If he wants you to leave then hold him to doing it properly, not this passive aggressive nonsense.
Print your own cards with the title you want.
In some countries that would qualify as constructive dismissal (illegal). Not sure about Japan though.
Saying you are now team leader but you haven’t been demoted, your CEO is straight up lying to you. So keep that in mind when you consider your options at the company. What he probably should said is something like:
“When we raise our next round, we need a more senior, Japanese COO in order to convince investors we can deliver. You might be that guy. You might not. The decision will be up to the board, not just me, which will include feedback from our key investors, some of whom will likely get board positions as part of their investment. That could include the COO seat. We will keep your pay and options the same regardless, your team will still report to you, and your title is Team Leader for now. When we hire the new COO, you will either report to him or be him. Thanks for your service so far and really looking forward to your continued contribution as we take it to the next level. What are your thoughts?”
tldr: you got demoted; accept it or find somewhere else.
First of all, if you are really a COO, you should be getting restricted stock, NOT stock options. Typically an executive at the COO level gets 2-5% of the total company stock granted in tranches over a few years. Second, as COO, you should be handling the day-to-day operations of the company as a whole.
By the sounds of things, you haven’t been given any stock, so you are just a regular employee with whatever title your boss gives you. You aren’t really in the position of a COO. I’d look for another job and leave as soon as you get it.
How much equity do you have in this startup?
If you like the job, the salary, the people you work with, and your life in general now, stay. If you think it would be significantly better if you moved on, do that.
Not getting what is in your contract is a red flag. Have you reminded them it is in your contract and you’d like them?
Re the stock options, that depends on what your contract says and whether you’re willing to go through the legal pain/expense/risk to get it. Either way if you’ve been sitting around for 2 years as a C level exec without actually acting on your contract… well guess you might learn something from this.
Go elsewhere you where not chosen. You are not the ceo, you do not decide. Its how it is. Doesnt mean you are bad by definition just mean you where not up to par this particular time.
Not sure what your contract says or how your organization is run but in the Japanese company I work for (180 employees) titles mean nothing.
We have a step up salary system that is regardless of title.
However, every company is different so kinda hard to comment without more info
A COO asking redditors what he should do..
If you are an executive you fall under a different set of laws and not specifically the labor act (the companies act)
Definitely lawyer up as you could be entitled to more options as COO than as a team leader, not having your options diluted as part of future series, and possibly early vesting of those options.
just checking, do you and are you personally not worthy of the COO role? and is that what everyone else think too?
or if you are competent and well deserve that title.