Circuit City is an electronic superstore based out of Richmond, VA.
Today the retailer announced it will lay-off about 3,400 employees or 8.5 percent of its workforce. The company called the firings a "separation" and the process a, "wage management initutive." Someone was quite creative (and sinsister) to think up those creative euphemisms!
The company has completed a wage management initiative that will result in the separation of approximately 3,400 store Associates. The separations, which are occurring today, focused on Associates who were paid well above the market-based salary range for their role. New Associates will be hired for these positions and compensated at the current market range for the job.
After the firings, the company will hire new sales staff and at much lower salary or "the current market range" since the original employees were paid too well at the outrageous sums of 10-11 dollars an hour. <snark>
In addition, according to Bloomberg News, employees will not have an option of taking a pay cut either.
And of course, Circuit City's CEOs' salaries will not be cut for being overpaid:
Circuit City Chief Executive Officer Philip Schoonover was paid $8.52 million in fiscal 2006, including a $975,000 salary. Best Buy CEO Brad Anderson received $3.85 million, including a $1.17 million salary.
Mmmm, what do you expect from a company who donates 90% of its political contributions to Republicans, according to BuyBlue? 26,000 may not seem a lot, but it does buy a certain amount of attention.
$2,500 to Democrats
$23,500 to Republicans
$0 to Others
$26,000 in Total Contributions
Labor. Is it dead? Is this just a step in a long downward spiral for salaries in the US? Thinking about it, it can happen to most of us.
Well, give Circuit City a holler. And tell them a Concerned Progressive sent ya!
Circuit City Stores, Inc
804-527-4000
Update: Shares are UP for Circuit City. Interesting, the retailer doesn't mention the lay off news on its own investor relations news page website! Instead, the news appears on its news release page on a page titled, "Circuit City Stores, Inc. Announces Additional Changes to Improve Financial Performance." Scoundrels.
Update II: Pretty good article on the possible backlash of all of this. vassmer
http://www.courant.com/...