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Circuit City laying off 3400 experienced employees - they cost the company too much
Goraja
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Registered User regular
http://www.usatoday.com/money/industries/retail/2007-03-28-circuit-city-layoffs_N.htm?csp=34
So much for last hired, first fired. Apparently having experience with a company isn't an important consideration when determining who one keeps and who one let's go. I never realized that being considered a good worker and keeping your job with the same employer for a long period was a company just being "charitable" to the employee.
Someone who has worked 3, 5, 10 years for a retailer, always been given great performance reviews, generally considered an asset to the operating of the store and likely can be counted on to do their tasks without needing to be checked on every few minutes should simply be sacked because his competence and experience at the business now prices him higher than the raw new employees? It's not like everyone with experience can become (or wants to become) a manager. If the employee likes his job and does it well, why should he be summarily penalized for being competent at what he does and compensated for the many years of service already provided? The experience alone is going to make the long-term employee more productive in their ability to help customers and whatever other tasks they have to do during the day than a constant turnover of new workers who, knowing the company will only keep them for a few years and fire them if they stay around too long, are not gonna have any reason to provide anything more than the absolute minimum level of performance.
Poor form, Corporate America.
Circuit City's plan to fire 3,400 will have ripple effects
By Stephanie Armour, USA TODAY
Circuit City Stores' (CC) decision to lay off 3,400 employees in order to hire lower-paid replacements is raising questions about the impact of severe cost-cutting on employee morale.
The consumer electronics retailer announced Wednesday that it was immediately firing store associates "who were paid well above the market-based salary range for their role." New workers will be paid less, although Circuit City did not reveal the pay of the workers.
Laying off workers who earn higher pay raises the risk of deflating the morale of employees who are left behind, says Penelope Trunk, author of Brazen Careerist: The New Rules for Success.
"People left behind are probably thinking they don't have a future there," Trunk says.
Those hourly workers who are laid off will get severance packages and can apply for open positions after 10 weeks.
"We have and continue to pay competitive wages in the stores across the country, but we have to control costs," Circuit City spokesman Jim Babb says. "We've got to get our stores to adhere to wage ranges."
The layoffs could have broad impact:
•Copycats. Other employers could follow Circuit City's lead. Many already are trying to curtail compensation costs. Seven percent of companies plan to trim staff levels during the second quarter of 2007, according to a survey by Manpower.
"If lower-cost labor is available, it's the right thing to do. They're not a charity," says Francie Dalton of Columbia, Md., president of Dalton Alliances, a management consultancy. "If it was your business and you have lower-cost labor available, you should do the same thing."
•Employee morale. After layoffs, companies must deal with a demoralized workforce by reassuring them that the decision is in the best interest of the company and those left behind.
"You have to reassure (the remaining workers) that, 'You're OK, and we're a stronger company now,' " says Paul Endress, president and CEO of Maximum Advantage, a Harrisburg, Pa.-based company that focuses on applying psychology to hiring and retaining workers.
•Waning productivity. Employees left behind or rehired later at lower wages could struggle with productivity, which is common in the wake of corporate cost-cutting.
Circuit City, which like other electronics retailers faces stiff competition, reported a loss for its most recent quarter ended Nov. 30, and its stock price has fallen 39% from its 52-week high. Its share price rose Wednesday to $19.23, up 1.9%
Contributing: Jayne O'Donnell
So much for last hired, first fired. Apparently having experience with a company isn't an important consideration when determining who one keeps and who one let's go. I never realized that being considered a good worker and keeping your job with the same employer for a long period was a company just being "charitable" to the employee.
Someone who has worked 3, 5, 10 years for a retailer, always been given great performance reviews, generally considered an asset to the operating of the store and likely can be counted on to do their tasks without needing to be checked on every few minutes should simply be sacked because his competence and experience at the business now prices him higher than the raw new employees? It's not like everyone with experience can become (or wants to become) a manager. If the employee likes his job and does it well, why should he be summarily penalized for being competent at what he does and compensated for the many years of service already provided? The experience alone is going to make the long-term employee more productive in their ability to help customers and whatever other tasks they have to do during the day than a constant turnover of new workers who, knowing the company will only keep them for a few years and fire them if they stay around too long, are not gonna have any reason to provide anything more than the absolute minimum level of performance.
Poor form, Corporate America.
Goraja on
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Work for 5, 10 or 15 years at retailer? Pffftttt....
haaaaa gughghhaaaa haaaa.... "Hi Bob. You've been with the company for a long time, and we think you are a great worker. So, we are going to lay you off, but feel free to come back and work for a quarter over minimum wage in a few weeks."
seriously, it is fucking retail. Experience beyond about 3 months does not make a difference, folks are over paid for the work they do.
I'm calling it early. Don't do your Christmas shopping in November this year. Wait until Circuit closes a shitload of their stores in January, and clean up at the liquidation sales.
I don't know about you, but I prefer to get advice from people that have actual experience in their field. There's a very tangible service quality moving between high-school wage slaves at Best Buy and the tech enthusiasts that have been working at Radio Shack for years.
I was interviewed by no less than five people, each of whom said, "So you want to work in our music department?" "Uh, no, I'm responding to the ad in the paper for a computer salesperson." The fifth person finally leveled with me: they weren't going to hire me because I had too much computer experience and they prefer to use their computer department as training for their entry-level salespeople.
Fuck Circuit City.
the "no true scotch man" fallacy.
Bold'd for "Excuse the fuck out of me?"
Having worked retail for the vast majority of my adult life, I wouldn't say that there's ever been a single time in my life that I've come across a retail employee who was overpaid for what they do. Retail corporations make a ton of money off of the fact that their jobs are in high demand. They can hire at minimum wage or just barely above and still keep employees for a long time. The only ones they need to pay well are the management (sometimes not even that) and corporate.
Retail employees are the new blue collar worker of our service economy.
Rule #1 when shopping at a big box store. Always know exactly what you’re looking for before you go.
I’m getting off the soap box now. This rant isn’t a much fun as I’d hoped.
Probably a lot, but it's kind of disturbing to think about.
How would Francis Dalton feel if her job was given to someone new and she was thrown out on the street? Probably wouldn't be feelin' that too much.
Screw that noise. Working hard and paying your dues just doesn't count for much anymore.
I wonder if they know that treating your employees like shit tends to have a strong, negative impact on customer-service.
Silly VC, no big retail chains recognize this.
Starbucks.
That's because Phillip Morris knows how to keep customers coming back for more.
Starbucks = food service != retail. But point taken, nonetheless.
The best thing for the remaining employees to do would be to find new jobs and then give two seconds (not weeks) notice.
Yeah, coffee-shops are actually both.
No, they're running a company. And this is a particularly shitty way to do it. Don't give me that hyper-capitalist bullshit.
None, eh? None at all? Don't show up on time, don't do their jobs, they all just come and go as they please and steal from the company at will, eh?
I'm not defending the actions of the company, but this is pretty much how retail -works-. You get kids who need money while they're taking classes to handle sales, or old people who are bored out of their minds but who will die soon.
I worked retail for three and a half years, while getting through my GE courses and getting my sanity back.
It was a struggle to get a 30 cent raise there after two years, and my being one of their best employees.
The problem with this is that most of the big retail chains and a large percentage of the smaller stores DO expect their employees to treat the jobs as permanent. A lot of retail jobs are really tough to get time off from, for example. When interviewing with retail companies, they often ask you how long you intend to stay with them if they hire you - heaven fucking forbid you answer anything less than "Why, forever, sir!"
I agree that this is still how they treat you once you are, in fact, hired. You're so expendable as a retail employee, you're constantly looking over your shoulder to make sure you're not being watched for every little mistake. It's a fucking nightmare.
Unfortunately, it's also the only thing a lot of people are qualified for. I've done nothing but retail work my entire life, and I haven't been able to figure out how to work my way elsewhere. It really sucks to be 25 and still applying for retail jobs, but a very large sector of the employed population is dependent on retail-level employment.
You read that exactly backwards. Read the second sentence and try to figure out how that's "hyper capitalist".
Man, what? Maybe you should just re-state it.
Tell me about it. I'm 27, managed to squeeze my way into an assistant manager position a year ago, and I'm fucking miserable. A nice, boring, monotonous office job spending 8 hours staring at three walls of a cubical sounds like heaven to me, but good fucking luck getting a callback for an interview when all I have on my resume is retail.
Incenjucar: I live in California. Construction is done entirely by migrant workers here, pretty much.
Cat: I suppose I could try that, but I'm not sure that would be the way I want to end up, either.
Groups like McGraw Hill (standardized testing agency, among other things) and the IRS have occasional periods of "We need a thousand monkeys for our thousand type writers."
My mom once landed a temp job with the first that turned in to a 25 year career, and got into a management position. She only left because she had risen too high for her shitty weak heart to handle, but she was making some damned good money before she left.
And I assure you, that's better for your resume than "I worked at Wal*Mart for a 25 years."
--
Defrag: I work in a general construction contractor's office in one of the most construction heavy parts of California, in a construction family, and still have my Carpenter's Union card, even though I don't touch tools anymore. You really shouldn't be telling -me- how construction works here. Why don't you tell TheCat about soil.
It seems like a stupid move.
"Retail-training" is a misnomer.
All those costs will be less then what they lose paying more experienced employees. As for happy customers? They only care so far. Plus most of retail jobs don't require that much experience for you to be adequate at them, which is all that's really expected of you.
took out her barrettes and her hair spilled out like rootbeer
Most of the people I've worked with were white, or near-white, and the only people I dealt with who didn't have English as their primary or only language were the unskilled LABORERS.
See, here's the thing. The unions? Especially the carpenter's union? They like people who are at least -reasonably- educated, and can read instructions, so as to live long productive lives which will bring in lots and lots of money (Seriously, the dues the unions charge are insane, you have no idea what a carpenter is worth -- and they're one of the lowest paid groups in construction until they hit management -- steel workers make a goddamn killing, when they don't fall off of skyscrapers by ignoring safety rules). The Unions also really hate it when you can't speak English proficiently.
http://www.dir.ca.gov/DLSR/PWD/index.htm
Right now, I think the starting, minimum wages you can get as a carpenter, first year union apprentice, is $16 an hour, in Fresno, which is pretty low in Cost-of-Living. Health and benefits and vacation kick in fairly soon. You will be trained. They will help you get jobs when projects are finished. You get unemployment if you don't screw up and get fired before a project is finished.
Again, Carpenters actually have some of the lowest basic wages. This is offset by them being the most likely to be put in a management position, where you can hit six figures if you play your cards right.
That said, you -do- earn all that money. That shit will wear you out like you wouldn't believe.
But I'd rather earn $30 an hour plus benefits than $8 an hour plus being fired when I'm there long enough to earn $9 an hour.
that means in a given year, nearly every single employee will either quit or be fired --> the latter often because they've been there too long and are being paid more than BB would like to be paying it's employees.
thats the official stat, but anecdotally, pretty much everyone I know and worked with at BB has either been fired over something relatively trivial (looking for reasons to can a person) or quit because everyone else was canned. and they get replaced with n00bs who know next to nothing, but will accept several dollars less in their hourly wage
Man, what? Maybe you should just re-state it.[/QUOTE]
Fine: Yes, businesses aren't charities. They should keep in mind that works both ways. Most managers would be EXTREMELY pissed if you quit without warning for a 2-cent raise, but they do the equivalent to their employees without batting an eyelash. Its going to bite them in the ass eventually.
Deusfaux: yep. The last time I worked retail, I was there for one year. By the time I left, I was the third most senior employee there..
And the ones who have been there longest also will know the best ways to get stuff out of the store.
This is basically the Wal-Mart effect in action. It's a drive to the bottom; lower service, lower standards theoretically lead to lower costs, which bring in customers and raise profits. Of course, Circuit City is not Wal-Mart, I doubt they have the business structure to be able to run that way. Plus, they probably realize that having experienced, knowledgeable staff is not useful anymore, given that so many people get their info from the Innerweb these days.
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