Groupon is a company that was celebrated by investors until August of this year when their web traffic dropped by 50% from June. The company has also been trying to deflect a lot of negative publicity with regards to valuations that put them between $15 to $20 billion even thought Q2 of this year they lost $103 million and claimed revenues of $878 million. Unfortunately for them, things are getting worse with the addition of another class action lawsuit.
Employee dissatisfaction seems to be at an all time high with regards to their sales force. Former salesperson Ranita Dailey will represent hundreds of plaintiffs in the suit that cites Groupon violated state and federal labor laws. They are seeking three years of overtime, other back wages and punitive damages. Filed with the suit was a bi-monthly pay stub that has Dailey working 106 hours and receiving compensation for 19.75 hours along with $478 in commission. The lawsuit was filed last month after alleged Groupon employees were posting comments to the tune of "Immense pressure to hit unrealistic sales goals," and "Sales staff cries all the time," on Glass Door.
I think many of their problems stem from a business model that just doesn't work and businesses are finally starting to realize that offering their services at 50% then giving Groupon a cut is not such a hot idea.