Odysseus punishes the disloyal servants with death. Of the fifty maidservants in the palace, twelve have been unfaithful--such as Melantho, who has been sleeping with Eurymachus. These women are made to clean the great hall, which is splattered with blood, and then they are hanged. Melanthius is the only male servant who is killed; he betrayed Odysseus by obtaining weapons for the suitors from the storeroom where Telemachus had placed them, supposedly to protect them from smoke and to keep the drunken suitors from using them against each other, he had said. Recall as well that when Odysseus, disguised as the beggar, accompanied Eumaios the swineherd on a journey to the palace, Melanthius the goatherd had belittled the beggar and tried to kick him. After the battle Melanthius' body is mutilated horribly before he dies.
Odysseus doesn't kill all his servants in the first place. He does kill very many, though. He kills most of them for following the suitors (serving the suitors), and I guess because the more people to survive, the faster more soldiers would come. Also, he's kind of ticked off. (I would use a different word.)