This is effectively demoting and laying off middle management.

These SDMs won't be an IC _and_ manager. These SDMs are demoted.

Eh, not necessarily demoted; many companies, and I'd assume Facebook, would have IC levels parallel to their EM levels. They might be looking at... sidemotion?

> would have IC levels parallel to their EM levels. They might be looking at... sidemotion

Sure. Many companies do this too. Like Senior Engineer at the level of Engineering Manager and Staff at the level of Senior Engineer Manager.

They don't have direct report and they still write code.

Same payband and leveling but different job function.

But at the end of the day, the ICs still have to "report" to Management: Senior Engineer even if they have same payband and leveling still have to report to an actual Manager.

Well, sure, but in a company of any size managers also have to report to managers; it's managers all the way up.