Circuit City to cut more than 3,500 jobs

venomclan

http://news.yahoo.com/s/ap/20070328/ap_on_bi_ge/circuit_city_layoffs;_ylt=Aof36O6C51JGp9QPcHdpknBv24cA

Circuit City Stores Inc. said Wednesday it plans to cut costs by laying off about 3,400 store workers and hiring lower-paid employees to replace them, and by trimming about 130 corporate jobs.

The store workers being laid off were earning "well above the market-based salary range for their role." They will be replaced with employees who will be paid at the current market range, the company said in a news release.


Right, because the $1 above minimum wage is big bucks. And I thought the service was bad now.....
V

PolkThug

lol, not suprised.

jdhdiggs

Well, $1/hr times 3,500 employees each working say 30 hrs/wk... $105K/wk, $5.5Million per year... Not a bad addition to the bottom line. Why do you think CC should be forced to pay their workers higher than the market rate for their skillset and experience?

heiney9

venomclan wrote:

http://news.yahoo.com/s/ap/20070328/ap_on_bi_ge/circuit_city_layoffs;_ylt=Aof36O6C51JGp9QPcHdpknBv24cA

Circuit City Stores Inc. said Wednesday it plans to cut costs by laying off about 3,400 store workers and hiring lower-paid employees to replace them, and by trimming about 130 corporate jobs.

The store workers being laid off were earning "well above the market-based salary range for their role." They will be replaced with employees who will be paid at the current market range, the company said in a news release.


Right, because the $1 above minimum wage is big bucks. And I thought the service was bad now.....
V

I didn't even realize it was legal to fire people and then fill the jobs again solely because they are paid too much. :eek: It just seems wrong. You can get away with "moving" to a country that has a lower pay scale to cut costs, but to balatantly say your current workers and paid too much so we'll fire and hire people who will work for less.

heiney9

jdhdiggs wrote:

Why do you think CC should be forced to pay their workers higher than the market rate for their skillset and experience?

Forced...........who forced CC to pay their workers the current money they receive .

Market conditions and the pool of employees should be a big determinig factor in what someone gets paid.

Pay discrimination goes on all the time, it's usually not this blatant and it's usually not announced in the headlines.

jdhdiggs

Exactly... If your employees are making more than the pool/market suggests you make a correction.

If person A and B are equally qualified and A is already working for you for $10/hr and B is willing to work for $8, you don't think it's the businesses right to change employees?

It's kind of like you switching what toilet paper, milk, or gas due to price. If it's cheaper to go across the street, you will. I really don't get why people get so outraged at stuff like this when they do the exact same thing everyday in their lives.

Also: CC can rehire/lower the wages of current employees. If the employees don't like it, they can find jobs elsewhere. Free market economies...

Check out France's economy for the alternative.

engtaz

They can also make everyone repost for their job and pay them less. Winn Dixie and Publix grocery stores have done that.

engtaz

venomclan

jdhdiggs wrote:

Well, $1/hr times 3,500 employees each working say 30 hrs/wk... $105K/wk, $5.5Million per year... Not a bad addition to the bottom line. Why do you think CC should be forced to pay their workers higher than the market rate for their skillset and experience?

I never said I thought that they should be paid higher than the "market rate", I just find it odd that they would blatently come out and say that they are firing their workers and in the same sentence, that they are hiring those that will work for less. It paints a terrible picture for the company and I am sure morale is not that great. it was a dumb and cold comment to make.

CC's presentation is not Wal Mart. They have big ticket items that demand some type of semi-informed sales staff. The company just basically admitted that they don't give a crap about customer service, non-laid off workers, etc... All that matters is the bottom line. While true, I think the comment is an error in judgement.

CC used to pay commissions. They went to straight pay about 7 years ago. Service eroded further. Now this.
V

heiney9

jdhdiggs wrote:

Exactly... If your employees are making more than the pool/market suggests you make a correction.

Who says they are making more than the pool/market suggests?? It's obvious CC is having financial problems meeting obligations to the share holders. Cut the workforce, reduce pay, close unproductive stores, cut back on perks, etc, etc. But it's just wrong to announce 3500 worker layoffs and then say but we will hire people back people who are willing to take less.

I know we all are (for the most part) at-will employees amd big corporations don't in any way shape of form foster loyality anymore. But this is just wrong, they choose to operate at the current pay scale, if corrections need to be made their approach is just wrong and dispicable.

zombie boy 2000

Why not "grandfather" in existing employees? And establish the new pay rate with subsequent hires. I'm sure the turnover rate at CC is high enough that financial results should be seen in the near future....

I'm with H9... it just doesn't "feel right"

mhardy6647

I am not a big fan of unions, which in many ways have outlived their usefulness... but this is the sort of thing that drives unionization of a workforce.

wingnut4772

Wow. So much for loyalty. That's like punishing employees for staying with you.

avguytx

Circuit City did this back in mid 2001 when they changed their pay structure from commission to hourly/salary because they had people being "paid too much". Hmm...ok, if you're in sales, and you want a raise, isn't the only way to get that raise to SELL MORE??? They went to that plan right as I went to work for the rep firm I'm with now and we were doing the call reports in the CC's for one of the lines we rep'd at that time. One month I did the call reports, the next month, it was over. And, it is always sad to see someone lose their job and move on. They never perfect their profession. That's one thing about this country that has changed over the years. Hardly anyone keeps a job with a company for 30+ years and "retires" with it. My grandparents both worked for the same company for 30 years and retired. The longest I've been with a company is 5 1/2 years and I doubt I retire with them...who knows.

I guess it's time for them (CC) to shed some pounds and try to start over again. In a way, you kind of laugh at the "Big Box" guys struggling to keep things afloat. I know I do in a way because it means my "independent" dealer base will hopefully take note and step up how they do things. Learn from the big guys mistakes and make changes. In this day and age of electronics (or anything for that matter), you have to change to keep up...or you go away. Look at Montgomery Wards...at one time they were the BIG DOG...then they were gone because they wouldn't change.

No one is guaranteed a permanent job in this industry (Cons Elec) anymore. It's like we've always joked about..."The names don't change...only the resumes`." I hope I can make it another 20 years in it at least! I've already been in at for 25 already. I gotta retire someday! lol

mrbigbluelight

Management types:

1. Manager: one who looks at the bottom line.
2. Leader: one who looks at the horizon.


CC is obviously infested with "managers".

jdhdiggs

And how many people who have posted run their own business? How many are at a level to make these kinds of decisions? Until you have, you can not really see both sides of the issue.

MBBL: According to that, being a leader is a hell of an easy way to get fired. Are you suggesting they overpay unskilled workers as the big blue box and walmart destroy the company and keep on doing so as CC is "led" into the ground and bankrupcy firing everyone? Good plan...

To me, at least they wer upfront and honest about it. Most companies would just fire the folks and never give the option for rehire. And yes, if they can fire everyone and rehire a workforce for less, they are paying above market.

As for punishing the employees that "stuck with you", um, have you been to a CC? We aren't talking about engineers or doctors who have put in 15 years of highly skilled work. Your talking about low/unskilled workers standing around giving you bad information and have a turnover time of around 8 months. The only guys worth a squat are the stockers and the car audio install guys. I mean, lyalty? Like the guy using the tuition assistance only to bail on the company when he graduates? Like that loyalty?

steveinaz

wingnut4772 wrote:

Wow. So much for loyalty. That's like punishing employees for staying with you.

Exactly. Corporate greed, plain & simple. ****. There is no loyalty in America anymore.

tommyboy

jdhdiggs wrote:

As for punishing the employees that "stuck with you", um, have you been to a CC? We aren't talking about engineers or doctors who have put in 15 years of highly skilled work. Your talking about low/unskilled workers standing around giving you bad information and have a turnover time of around 8 months.

These were the few guys that actually knew what they were talking about(at least the ones I worked with, though they made double I did...), now no one will know anything. I guess TV salsemans aren't real jobs anymore...

When they took away commission a few years ago, what they did at our store( I wasn't there) was anyone making on average less than $16, got that pay as an hourly wage. Anyone over 16, got "laid off". So you got fired for being a good salseman... thats smart.

Quitting that job was the best choice I have ever made:p

shack

There are several threads about "best deal", "lowest price", "where can I get XYZ product at the lowest/best price"....

And then this thread....

Low prices and low wages aren't mutually exclusive.

sucks2beme

I saw last XMAS big checkout lines at BB, quiet at CC. They're going under
sooner or later. This is the wrong move. You could go there with cash in hand, and leave pissed off with no service. This little move will doom them.
The management don't get it. They need to go wait around in one of their stores for service, then re-think pissing off what few real workers they have left. I don't go to Wallymart, guess CC is on the list now. Fry's should be on the "avoid" list too, but I still go there once in a while with false hopes that
things have improved.

Polkersince85

IMHO, This is just the start of something larger. There is a lag of recognition in most typical brick-n-mortor retail industries of the future trends of purchasing. Most of them have never faced the threats posed by the influx of inexpensive products coming from China, Inc. The online purchasing of the products has dramatically increased while the retail store suffers. With the cheap prices the products bring, the cash flow the managers depended on for years has disappeared. In retail, cash flow is what makes the world go around. The discounts of large volume purchases that the large cash flow used to command have disappeared with the influx of cheap products. Now everybody can buy cheaply. Like the founder of Intel said, "There are two types in business, the quick and the dead."

Rivrrat

I pretty much stay away from any of the mass market consumer electronic places whenever possible. They don't usually have the products I want, I can get accessories cheaper online, and what they do have that I could be interested in I can find comparable cheaper at someplace like Costco.

I also really hate being hassled incessantly about extended warranties on throw away electronics. NO, I do not want an extended warranty on a $199 camera.

I'm not surprised CC is in trouble. The one here stopped carrying anything decent, and looks like an Office Max now. At least Best Buy pretends to carry some higher end stuff (Magnolia Hi-Fi), but I avoid that place like the plague too.

What's really a shame is they absorbed Magnolia Hi-Fi in the first place, a place I used to hang out in when I was younger living in Seattle.

rskarvan

The solution is simple: Organize a Union and picket the piss out of the store!!!

Rivrrat

I just looked at their stock performance. They're down about 30% in the last year, and aren't rated as a good buy by the analysts, but Best Buy isn't doing much better either.

shack

rskarvan wrote:

The solution is simple: Organize a Union and picket the piss out of the store!!!

Wow there's a solution. Instead of some people having jobs...no one will have a job...guaranteed!

Mike682

CC's announcement of laying off "better paid" workers is a stupid idea that concentrates on immediate savings rather than long term effects.

Skim some of the fat cats off the top of the pile and get some executives that can actually drive the retail chain

Toxis

CC will be gone soon... give it a couple years. They've been on a spiral downhill and this just proves it. They're basically headed straight down and are trying to lift up which will do nothing.

I saw a report for the Kansas City market and BB had 55% market share where CC had 4.5% Yes, 4.5. Way to go guys.

Rivrrat

I saw a report for the Kansas City market and BB had 55% market share where CC had 4.5% Yes, 4.5. Way to go guys.

That sounds like a good stock to short.:rolleyes:

mrbigbluelight

jdhdiggs wrote:

And how many people who have posted run their own business? How many are at a level to make these kinds of decisions? Until you have, you can not really see both sides of the issue.

Well......maybe you, or the managers you associate with are restricted in the ability to think outside the box of their immediate, known surroundings, but I'm not.
I'm not a woman, but I can tell you rape ain't a good thing.

jdhdiggs wrote:

MBBL: According to that, being a leader is a hell of an easy way to get fired. Are you suggesting they overpay unskilled workers as the big blue box and walmart destroy the company and keep on doing so as CC is "led" into the ground and bankrupcy firing everyone? Good plan...

If being a leader gets you fired, than you're working for the wrong company.
Get a better job.

And being as peoples' tax dollars (in the form of TIF funding) help to build Walmarts all across the country (after all, Walmart is in dire financial straits, right ?), than what is the quid pro quo for the people providing this corporate welfare ?
How about : additional traing for these unskilled masses ? I say that that would be a fair return for the tax dollars given to Walmart that was taken out of the local communitys' tax coffers. Money that could have gone for .... a better, more affordable educational system for the unskilled masses.

jdhdiggs wrote:

To me, at least they wer upfront and honest about it. Most companies would just fire the folks and never give the option for rehire. And yes, if they can fire everyone and rehire a workforce for less, they are paying above market.

Than by all means, let's continue on with that admirable business model, and bring back the concept of the "company store", "company town", and "company doctor".
Well, I guess we already have embraced the concept of the "company doctor", only now they're called "Workmen's Compensation Physicians", some of whom actually speak English (to a degree).

jdhdiggs wrote:

As for punishing the employees that "stuck with you", um, have you been to a CC? We aren't talking about engineers or doctors who have put in 15 years of highly skilled work.

No, we're talking about teenagers (some of whom are working to pay their way through tech school or college), women (some of whom are working to pay their way through life as single mothers, a coping skill which can dwarf the skill level need be a doctor or engineer), and other working class people.

jdhdiggs wrote:

Your talking about low/unskilled workers standing around giving you bad information and have a turnover time of around 8 months. The only guys worth a squat are the stockers and the car audio install guys.

And where are the skilled, college-educated MBA's who are allowing these people to stand around ?
Is that a course taught in management classes ?
Giving bad information ?
So these unskilled workers actually have good information to give, but choose to give bad information ? Of course not, all they have is bad information.
Again, management's fault, either by hiring practices or by training practices.

jdhdiggs wrote:

I mean, lyalty? Like the guy using the tuition assistance only to bail on the company when he graduates? Like that loyalty?

Or the company, like Walmart, that uses business tuition assistance (aka TIF) to take from the community, hire unskilled, uneducated workers than lower wages when profits aren't as projected or desired.

wingnut4772

This was posted over at AVS :

"Having worked as a Grievance Officer and handled Civil Rights violations and a Fraud Investigator on Federal Programs I sincerely hope any protected classes caught in this crap transition seek legal counsel in their region and file Civil Rights complaints especially any that may be over the age of 40 for AGE DISCRIMINATION!

Many major corporations have attempted this in the past until challenged and in most cases they lose. You cannot just wipe the slate and fire all your older workers and replace them with new younger workers - Age Discrimination Act and Civil Rights laws have not changed period to permit something like this unless the employee's act as Sheep and let it happen. Hopefully Circuit City is held accountable for what is clearly an unfair labor practice and violates all Labor management laws.

Wouldn't corporate America love it to wipe out it's long term employee's and start with a bunch of fresh recruits at the bottom of the pay scale. AAA tried this in our State years ago and they paid in the millions for doing so. Hopefully any such protected classes seek legal counsel and make this BS punishable or the next thing we'll all be replaced by illegal immigrants or pimple faced burger flippers!"

__________________

BaggedLancer

This company will follow in the footsteps of Tweeter soon I feel(closing 1/3 of all stores)

jdhdiggs

Yup MBBL, your right, WTH do I know. With your real world experience of working with multi-billion dollar stores and the financial realities there in... I mean, if you're so good at thinking outside the box and being a leader, why aren't you on the forbes 500 list? If it was that easy for you, it would take no time at all to make a fortune. I am currently involved with CC on this very issue right now. I see the actual realities of what they face and I know for a fact the decision was:

Declare bankruptcy, shut half the stores, about 10,000 get outright fired
3500 have their pay decreased, and take other actions.

I'm not saying that their decision deosn't suck, it's just a lot better than the alternatives. And yes, the managment at the store levels has been atrocious leading to hiring and training of inept workers. But whay should that keep the company as a whole from correcting the issue? Are you really in favor of: "You hired them so now your stuck with them!"? If so, go see how France's economy is doing. How productive their average worker is and how much unemployment they have for just this very reason.

Which solution better to the workers? Do you amputate a hand to save a life?

Also: CC management is also trimming the fat out of other areas including corporate and other cost streams. I'd give you more but I am under an NDA. It is clear that most in this thread have no grasp of the responsibilities and realities faced by a corporation like this.

And why on earth are you bringing up Walmart policies as an attack on CC?

Also: I'd like for you to describe a person affected by this change that didn't choose to be in that position.