Fairpoint to Lay Off 400 Workers
Four Years After Promising Verizon Deal Job Creation
To get their $2.7 billion acquisition of Verizon's New England networks approved by regulators, in 2007 Fairpoint promised they'd create 675 jobs
, but immediately following the deal Fairpoint collapsed into bankruptcy amidst a wave of significant service disruption. While the company has righted the ship somewhat and has been meeting broadband build out conditions
, Fairpoint remains financially strained by the heavy debt-burden of the deal -- and the constant erosion of traditional landline customers. Roughly four years after making job creation promises, Fairpoint has announced
that the company will be slashing their job force by around 400 workers to save $34 million. "We are making this decision after careful evaluation to ensure that FairPoint is staffed appropriately to serve our customers well, while prudently managing expenses," says company CEO Paul Sunu.
math isn't too far off $34 mill / 400 employees = $85,000/employee
I'm sure that includes benefits
Re: math isn't too far off thats before benefits, average technician is making around $75k to $80K before overtime...
Re: math isn't too far off
said by charlieweiss :?Really? Average technician pay is 80,000 a year before overtime? Really? That comes out to over $38 an hour. Fairpoint techs make $38 an hour, base wage? I'm working for the wrong telco!
thats before benefits, average technician is making around $75k to $80K before overtime...
Executive I bet no executives loss there jobs and even if they do they get a HUGE golden parachute for there part in helping verizon offload a failing business(Landlines). If the numbers are right then the people losing there jobs are ones that make around $85,000. a very nice wage but not near the pay a executive gets in salary and those "bonuses". Why cant exec's of a failing company ever just take a pay cut? i mean they get stock options not available to most workers, and they usually get very nice bonuses. Middle class being beat again for the failings of people who never have to worry about being poor.
New York, NY
Re: Executive Amen
Re: Executive Yeah - typically if it is managements fault, they take the whole company down with them (Enron, WorldCom)
| |N3OGHYo Soy Col. "Bat" GuanoPremium
Re: Executive Those guys at Citibank and Bank of America are doing an upstanding job, too!
All hail the job creators.
Oh, right. Never mind......
Gotta go, I've got a call coming in from Arthur Anderson via my Worldcom secure CEO link. I'm important, and you're not.
Now, go. Go back Proletariat fly to your un important little job, I have millions to make and deals to broker while you try and figure out how to heat your house this winter, or make your next car payment....
....Click Yes, Mr. Gore? Absolutely, I have no problem helping keeping your mansions cool in the summer and warm in the winter. Carbon footprint? That's for the schlubs who listen to so called "leaders". Do as I say, and not as I do.
Um, Mr. Gore, have you seen the Bush Ranch in Texas? Absolutely, Mr. Vice President, I agree, that solar thing is a bunch of bullshit, and that rain water collection WILL leave spots on our suv. YES, I understand that the Geothermal thing and passive solar will leave Tipper cold in the winter, but... but.. but...
Whole system's full of shit. Government by the people & for the people?
We're all puppets. Whole thing is a crock.
Petty people are disproportionally corrupted by petty power
| $34M is the cost saved by eliminating those employees. What the average employee earns isn't as simple as $34M/400. We have to remove these expenses from the $34M before dividing by 400:|
1. Average health plan costs for family coverage is $14K, for individual coverage $6K. On average companies pay 70% of family and 80% of individual.
2. Employer-paid wage taxes
- social security (6.2%)
- medicare/medicaid (1.45%)
- federal unemployment taxes (FUTA)
- state unemployment taxes (SUTA)
3. Employee materials & equipment (paper, pens, staples, copiers, printers computers, network, phones etc.)
4. Employee office space (cubes, chairs, desks)
400 people need a lot of space. Eliminating that many people may allow them to sell a building or terminate a lease.
Considering these costs, the average employee might be paid $50K to $60K, which is still a wage with some discretionary spending power but I wouldn't classify that as a "nice wage". $60K/1920 (workable hours in a year after 2 weeks vacation and 10 paid holidays) is a bit more than $30/hour. That's certainly better than burger joints and Wal-Mart but it's tough to support a family on this wage unless both adults work. As a result, a lot of families are going to be stressed and with 9% unemployment, it'll be hard to replace that $60K job. Since some of these folks are probably former Verizon "lifers", it's quite a bummer for them.
This is why the AT&T merger should be approved. To lose jobs!
Valley Stream, NY
Re: This is why the AT&T merger should be approved. And annoy existing customers
Re: Because they're losing customers to Time Warner how bout the CEO and Board take 30% pay cuts... Asses!!!
Re: Because they're losing customers to Time Warner I don't think the board members get paid large sums of money. While I agree with the premise of whacking executive pay if a company isn't performing, cutting a CEO's pay by 30% has more emotional impact than financial impact. Even if a CEO makes $10M a year base pay, 30% is only $3M. Granted, it's icing on top of $34M but not enough to really improve anything.
It is true that some CEOs have generous incentive pay packages but a company laying off employees isn't meeting it's financial targets and it's likely that most of those incentives won't be paid at all or will be substantially less. If they are tied to stock performance (options/stock grants), the CEO might be able to claim losses to offset their tax burden! (When you think about it, doesn't that suck!)
| |HarddriveProud American and Infidel since 1968.Premium
Wow. What a shit company. Good job Vermont, New Hampshire, and Maine. You've done a great service to your citizens.
When I press '1 for English' that means I want to talk to someone that speaks English!
Pro tip for all future buyouts like this: "Oh, but esteemed Mr. Congressman, what happened to Fairpoint would NEVER happen to us!"
Broke I can see why, just mailed my last check to Fairpoint, wire is dead.
Agencies.. and congress should never ever ever believe that mergers/takeovers, and acquisitions will result in job creations. They always result in job losses.
Fairpoint was just a way for Verizon to dump an albatross and get huge tax credits.
Re: Agencies.. congress had no control over this. It was basically let it happen or VZ will and would let those areas rot and get the sames to take away MTS and those citizens wouldn't have shit after that. Telcos also can NOT be forced to service any area. They can pull out with due notice 3-6 months (depending on the state) and then what happens? Grandma doesn't have telco service.