AT&T cuts 80
Similar layoffs are planned
in three other areas,
an official says
AT&T Corp. plans to announce Tuesday morning that it will close its telemarketing center in Honolulu's Waterfront Plaza and lay off nearly 80 union workers and managers.
The closure, which was confirmed last night by AT&T spokesman Andy Backover, is part of a nationwide move to stop advertising and marketing to attract new local and long-distance customers after a regulatory decision made it more expensive for the company to lease lines from local telephone providers, such as Verizon Hawaii. AT&T said it instead plans to focus on gaining new business customers and building its Internet-based calling network.
In July, AT&T laid off about 70 employees at the same center, according to Bob McCulloch, contractual vice president of Local 9415 of the Communications Workers of America.
With the closure, AT&T will be left with about 300 workers in Hawaii serving businesses and the military, Backover said by telephone from New York. The telemarketing and billing workers laid off will receive severance packages, according to McCulloch. They also will receive job placement assistance, he said.
Backover said similar layoffs are planned next week in West Virginia, Massachusetts and Puerto Rico.
Although Hawaii's workers were not supposed to find out the bad news until next week, word leaked out earlier this week in West Virginia, McCulloch said. He said Hawaii's AT&T management at Waterfront Plaza told the workers of the layoffs after they started asking about it. About nine management jobs are included among the layoffs, according to McCulloch.
McCulloch said a 60-day plant closure notice will be filed next week, and the employees' last day of work will be Nov. 19.
AT&T, the nation's largest long-distance company, occupies three floors in one of the Waterfront Plaza towers, and two of those floors will be vacated, McCulloch said. The only presence in the tower will be the floor that contains network operating equipment. He said two technicians will remain there to oversee it.
"We'll be working with our members to do whatever we can to assist in placing them in other jobs and in obtaining training for other jobs," McCulloch said. "These are all very highly skilled employees, and the company and the union does have a training program that will allow members to continue training even after they have left the company."
Backover said the company had warned of additional layoffs when it announced second-quarter earnings in July that showed an 80 percent drop in earnings and a decline in revenues for the 18th consecutive period.
"It's not an easy decision," Backover said. "We've been reducing costs in many parts of the company to remain competitive in the industry. Clearly, these jobs affected in your state are the direct result of a regulatory decision that went against us, forcing us to move resources out of a business that we had been in: traditional consumer residential phone services."
The federal court decision, which was not appealed by the Bush administration and the Federal Communications Commission, overturned a federal rule that had governed phone competition and allowed companies such as AT&T to lease local residential phone lines at discounted rates. The change in policy meant that AT&T would be facing higher charges to lease those lines.
Backover said the company's strategy shift will mean the type of work being handled by the affected employees will be less prevalent within the company.
McCulloch said the earlier round of layoffs indicated that there could be additional layoffs.
"It wasn't a total shock, but we had no idea when this was announced (in July) that this office was going to close," McCulloch said. "We weren't aware of which offices were going to close until this happened."