Why Did ByteDance Fire 90 Employees in 3 Months? Disney Trips, Crime, and the Hidden Cost of Growth

353 Employees Fired for Misconduct in a Year—What's Really Going On Inside ByteDance?

Would you risk your career for a weekend at Disneyland?

This isn’t a rhetorical question—it's precisely what happened recently at ByteDance. On March 6, 2024, ByteDance, the tech giant behind TikTok, released a shocking internal report through its Corporate Discipline and Ethics Committee. The report revealed that 90 employees were dismissed in just the fourth quarter of 2024 alone, and among them, 9 faced criminal charges.

But this isn’t just another corporate scandal—it’s a clear signal about how seriously big tech firms are cracking down on internal misconduct.

Luxury Hotels and Theme Parks: The Costly Mistake

A significant chunk of these dismissals involved employees abusing company resources for personal gain. More than 50 staff members were caught booking luxury hotels or expensive stays at Disneyland and Universal Studios—on weekends, no less—without any business justification. They exploited the company's co-payment policy, forcing ByteDance to cover up to 70% of their indulgences.

As ByteDance found, the issue wasn't isolated. Throughout 2024, a staggering 353 employees were fired for various violations, with 39 facing criminal investigations.

The Larger Trend: ByteDance Isn't Alone

ByteDance’s stringent actions are not isolated incidents within the tech industry. Consider:

• Meta Platforms (formerly Facebook) terminated 24 employees in late 2024 for misusing $25 meal credits to buy personal household items like toothpaste and wine glasses.
• Apple Inc. faced internal turmoil with the #AppleToo movement, where harassment and discrimination allegations exposed deeper cultural issues.

Such incidents highlight a concerning pattern—tech companies may be growing rapidly, but they're also struggling internally with employee misconduct.

Why Does This Misconduct Happen?

The reasons behind employee misconduct in rapidly expanding companies like ByteDance are complex:

• Inadequate Oversight: When businesses scale quickly, management oversight often fails to keep pace, creating gaps that unethical behavior easily exploits.
• Complex Organizational Structures: Hierarchies in large firms can blur accountability, making misconduct harder to detect and easier to hide.
• High-Pressure Environments: Employees under relentless pressure to deliver results might cut corners ethically, rationalizing unethical decisions to meet targets or secure personal rewards.
• Company Culture: If unethical behavior is quietly tolerated or poorly addressed, misconduct can quickly become a norm.

The High Cost of Ignoring Internal Misconduct

Ignoring internal misconduct can be catastrophic:

• Financial Impact: A recent U.S. study revealed misconduct costs businesses more than $20 billion annually.
• Reputational Damage: High-profile misconduct erodes customer trust, harming brand reputation and revenues.
• Morale and Productivity: Ethical lapses demoralize teams, decreasing productivity and increasing employee turnover.
• Regulatory Scrutiny: Persistent misconduct invites increased regulatory attention, potentially resulting in hefty fines and stricter regulations.

Investor Alert: The Importance of Corporate Ethics

For investors, these incidents are more than scandals—they're critical indicators of deeper organizational health. Companies like ByteDance acting decisively against misconduct signal a commitment to transparency and robust governance, vital for long-term sustainability and investor confidence.

However, frequent occurrences also raise red flags about internal governance risks. Investors should scrutinize corporate cultures and governance structures closely, evaluating whether companies adequately address misconduct proactively or only reactively when crises erupt.

Takeaway: A Wake-Up Call for Tech Giants

The ByteDance crackdown sends a strong message: ethical lapses are no longer tolerated, no matter how trivial they might seem initially. As tech firms continue to scale, maintaining ethical standards isn’t just idealistic—it's essential for sustained growth and trust from both investors and consumers.