A layoff is often a decision about where a company wants to put its money next, not proof that the company is failing, and understanding that changes how you prepare for one.

Last updated: 30 October 2026

On Monday, October 19, staff in Moniepoint's engineering and product teams learned their company was restructuring. Some roles would become redundant, and affected employees were offered five months' salary to resign voluntarily. The window to apply closed on Friday, October 23, and staff will be told whether their roles are affected between November 2 and November 11, according to TechCabal. The company, a Nigerian unicorn, says this is part of a regular strategic review and should not be regarded as a layoff (TechCabal).

It is a confusing moment for anyone inside a company like that. The business is still growing, expanding into Kenya and creating new roles such as platform architects (The Condia). So why are people being asked to leave?

The uncomfortable answer is that profitable, growing companies cut jobs far more often than most employees assume. Here is why it happens, what the research says about whether it works, and what Nigerian law and your own preparation can do about it.

A Layoff Is Not Always a Distress Signal

The old assumption was simple: layoffs meant trouble. That is no longer reliable.

Branch International, the fintech lender, laid off staff in Kenya and Nigeria in 2026 after the group posted roughly $30 million in global profit for 2025, and said both countries' businesses were profitable (TechCabal). Nigerian staff were told their last day was that same day, April 17, with severance of at least four months' pay (Legit.ng). Kuda cut jobs in March 2026 even as its financial position was improving, and 19 of 40 people in its marketing unit were reportedly affected (TechEconomy).

The pattern is global. Cisco told staff about thousands of job cuts in the same email that announced record revenue (SHRM). ASML announced 1,700 cuts after strong results, with its finance chief explaining that it was choosing to make changes at a moment of strength (Fortune). Wharton's Peter Cappelli argues that the companies cutting jobs are not necessarily struggling financially (SHRM).

Seven Reasons Successful Companies Cut Jobs

1. They are changing how work is organised. Moniepoint's plan is to replace layers of review with smaller teams that build and run products end to end. TechCabal reports the company believes the layers slow decisions and delivery, and employees it spoke to said Moniepoint can reject voluntary exit applications from people whose skills remain important (Geeky Nigeria, summarising TechCabal). A restructure can make some roles redundant even when the work itself still matters.

2. They are moving money to new priorities. In August, Moniepoint phased out MonieWorld, its UK-Nigeria remittance product, less than 18 months after launch (TechCabal Daily), and said it would redirect the technical, capital and operational resources behind it toward its main African markets (Innovation Village). Globally, profitable tech firms are cutting payroll while redirecting spending toward AI infrastructure (Tech Times). The money does not vanish. It moves.

3. Investors and boards reward leaner cost bases. TechCabal notes a broader shift in African fintech, where startups are prioritising leaner operations and profitability over aggressive expansion, even as funding conditions improve (TechCabal). A company can be doing well and still decide that margin matters more than headcount.

4. They are correcting earlier over-hiring. AI-washing, as analysts call it, describes companies blaming cuts on AI when the real drivers are cost-cutting, weak demand or past over-hiring (RankID). Teams that grew quickly during easy funding often end up with overlapping roles.

5. They copy each other. Stanford's Jeffrey Pfeffer argues that much of the recent tech layoff wave is social contagion, with companies imitating one another rather than following evidence (Stanford Graduate School of Business). When a competitor trims and is praised for discipline, others feel pressure to follow.

6. AI is the new stated reason, and it is sometimes the real one. Challenger, Gray & Christmas data cited by RankID shows AI was the most-cited reason for announced US job cuts in the first nine months of 2026, at about 21 percent of announced cuts (RankID). Yet Deutsche Bank analysts have described "AI redundancy washing," where firms attribute cuts to AI even when other factors may matter as much (IBTimes), and Gartner research cited by ManageEngine found no correlation between AI-related workforce reductions and measurable returns (ManageEngine). In Moniepoint's case, TechCabal reports the company says AI is not the reason, although it has discussed internally how AI could streamline product-management work (TechCabal Daily).

7. Nigerian conditions add their own pressure. The Central Bank of Nigeria set March 31, 2026 as the deadline for banks to meet higher minimum capital, and banks that could not raise enough had to merge, which almost always brings job losses (TechCabal). Fintech margins also face regulatory oversight and foreign exchange limits (TechEconomy), and funding-dependent firms such as crypto exchanges have cut staff to extend their runway (Nairametrics). A company can be healthy overall and still have one product, market or team that no longer fits.

Do Layoffs Actually Work?

Surprisingly often, no. Wayne Cascio, who has studied layoffs for decades, says the research finds no support for the idea that layoffs improve firm performance, beyond a short-term accounting bump (Knowledge at Wharton). Pfeffer notes that layoffs often do not cut costs, because laid-off employees are sometimes rehired as contractors who cost more (Stanford GSB).

The human cost is real. Research by Kate Strully found that laid-off employees were 83 percent more likely to develop a new health condition in the following year (Greater Good Science Center). Repeated cuts at profitable firms can also damage morale among the people who stay, and Glassdoor research cited by Fortune suggests the morale damage is no smaller than at struggling companies (Fortune).

That does not stop companies from doing it. It does mean you should not read a layoff as a verdict on your worth.

What Nigerian Law Says About Redundancy

Section 20 of the Labour Act defines redundancy as an involuntary and permanent loss of employment caused by an excess of manpower. In a redundancy, the employer must inform the trade union or workers' representative of the reasons and extent, adopt "last in, first out" within the affected category subject to relative merit, skill, ability and reliability, and use best endeavours to negotiate redundancy payments (Labour Act, s. 20).

Three practical points follow.

There is no fixed statutory severance. The International Labour Organization's EPLex database notes that Nigeria has no general statutory severance or redundancy pay, so payments are usually set by the contract and collective agreements, often based on length of service and last salary (ILO EPLex). That is why what your contract and staff handbook say matters so much.

Seniority does not always protect you, and neither does it always apply. Last in, first out is subject to merit factors, and the duty to inform the union only applies where employees belong to one. Management staff may be restricted from union membership under the Trade Union Act (Mondaq). Senior managers and professionals may fall outside the Labour Act's definition of worker, though contracts and the doctrine of unfair labour practice often produce similar protection at the National Industrial Court (AnooreHR).

Your severance may be largely tax-free. Under Section 50(1) of the Nigeria Tax Act, the exemption for compensation for loss of employment rose from ₦10 million to ₦50 million, with only the excess taxed (PwC Tax Summaries).

If You Are Offered a Voluntary Exit Package

A voluntary offer, a redundancy and a completed job loss are three different things. Before you accept an offer like five months' salary, ask these questions in writing:

Is the package on top of everything else? Check whether it comes in addition to accrued leave, notice pay, pension contributions and any gratuity.

Will the company definitely accept my application? Employees cited by TechCabal said Moniepoint can reject applications from people whose skills are still needed (Geeky Nigeria).

What happens if I decline? Moniepoint says it will first look for suitable roles elsewhere in the business, and a redundancy process follows where none can be found (Innovation Village). Compare the certainty of the offer with the risk of waiting.

What am I signing away? Some exit documents include a waiver of future claims. Have a lawyer read it before you sign.

What are the non-cash terms? In Branch's case, health insurance was maintained through the end of 2026 (Legit.ng). Small details like this can matter.

Warning Signs Before a Restructure

Moniepoint shut down MonieWorld in August and restructured two months later. Product shutdowns, new operating models, leadership changes, hiring freezes and delayed funding are often early signs. They do not mean your job will go, but they are a prompt to prepare.

How to Protect Yourself

Build a cash buffer. Aim for several months of expenses where you can, remembering that severance is never guaranteed to arrive quickly.

Keep your CV current. Our guide to 10 CV Mistakes That Cause Instant Rejection is a good checklist, and How Long Should a Cover Letter Be? helps you tailor your applications.

Record your results. Keep a running list of projects, numbers and outcomes. If roles are assessed on capability and suitability, as reported at Moniepoint (The Condia), evidence helps.

Know your market value. Use How Do I Know If I'm Underpaid? to benchmark your pay before you negotiate a package or a new offer.

Widen your skills. Roles that sit next to your own, such as the ones in Cybersecurity Jobs in Nigeria: Everything You Should Know, can give you more options if your function shrinks.

Prepare for modern interviews. Hiring has changed, as we explain in The Questions Interviewers Are Now Asking That Nobody Prepares For.

Keep your reaction off social media. Venting about an exit feels natural, but recruiters check profiles, as covered in Delete This Before Your Next Interview.

If You Are Laid Off

Get everything in writing: the reason, last day, package, and what happens to your benefits. Check the numbers against your contract and the Labour Act notice rules. Return company property properly and keep a record. Ask for a reference while goodwill is high. And look after your health, because the evidence on the strain of job loss is serious. Talk to someone you trust and ask for help early.

The Bottom Line

Successful companies lay off employees because their decisions are about priorities, structure, investor expectations and sometimes imitation, not only survival. That is why a cut can land at a firm with record revenue, a unicorn valuation or a profitable year. It is also why a layoff says far less about you than it feels like in the moment.

What you can control is preparation. Know your contract, understand Section 20 and the tax rules, keep your evidence and your CV current, and watch the signals. A restructure announced on a Monday should never be the first time you think about your next move.

This article draws on TechCabal reporting on the Moniepoint restructuring, Nigerian business and technology press, research by Wayne Cascio and Jeffrey Pfeffer, Challenger, Gray & Christmas data as reported by secondary sources, the Labour Act, ILO and PwC summaries, and legal commentary, current as of October 2026. Some Moniepoint details come from company statements and employees quoted by the press, and the outcome of the exercise was not yet known at the time of writing. This is general information, not legal or tax advice. Contracts, collective agreements and individual circumstances vary, so consult a labour lawyer, your union or a tax adviser before accepting any exit offer. Verify any specific figure against its linked source.