Mobile

Ouch: T-Mobile laying off 1,900 workers, more cuts to come

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Fourth-place U.S. wireless company T-Mobile will soon lay off around 1,900 workers due to the closure of seven call centers around the country.

T-Mobile has been in a precarious position ever since AT&T’s offer to acquire the company fell through in mid-December 2011.

Since the breakup, T-Mobile has scored a 3G roaming deal and a nice chunk of precious wireless spectrum from AT&T. But even with the additions, T-Mobile still reported a terrible Q4 in February with a loss of 802,000 contract customers.

T-Mobile USA CEO Philipp Humm delivered the somber layoff news to employees today with a memo about “consolidating” call center operations, according to a report by The Verge. In the memo, Humm wrote, “The reality is our cost structure must be better optimized to match our customer base and call volumes.”

The job cuts will come from closing centers in Allentown, Penn.; Fort Lauderdale, Fla.; Frisco, Texas; Brownsville, Texas; Lenexa, Kansas; Thornton, Colo.; and Redmond, Ore. Around 3,300 employees at the seven impacted facilities will be let go, but T-Mobile will immediately be filling as many as 1,400 positions at its other 17 call centers. As a result, around 1,900 employees will lose their jobs.

On top of that, Humm notes that more “restructuring” will come later, which almost always means more layoffs. T-Mobile will announce those cuts before the end of May.

You can read Humm’s memo in full below:

Dear colleagues,

I have difficult news to share today: we are consolidating our call center operations and closing seven of our 24 facilities. This decision was not easily reached, but it is a necessary measure. The reality is our cost structure must be better optimized to match our customer base and call volumes.

The affected Customer Service facilities are Allentown, Pennsylvania; Fort Lauderdale, Florida; Frisco, Texas; Brownsville, Texas; Lenexa, Kansas; Thornton, Colorado; and Redmond, Oregon. The consolidations will result in 1,900 net job reductions. Approximately 3,300 employees at the seven impacted facilities will be affected, and we will begin hiring immediately at the remaining 17 call centers to fill as many as
1,400 positions.

Impacted call centers will remain open for three months following this announcement. Affected customer service representatives will have the option to transfer to any of the remaining 17 call centers. Employees who choose not to transfer and are employed on the date the center closes, will be offered transition packages with severance pay and outplacement support. T-Mobile is partnering with an outplacement firm to provide on-site career centers at all seven facilities. Every employee will have access to a personal career coach and be offered job search training and tools. In addition, T-Mobile will pay for two months of continued health care coverage under COBRA (which is available for up to 18 months for eligible employees who elect this option).

Looking ahead, we will also be restructuring other parts of the company. It is important to note this will not include our customer service representatives in the remaining 17 call centers, technicians in engineering or front line employees in our T-Mobile corporate-owned stores. In other parts of the organization, the majority of changes will be announced by the end of May 2012. Senior leaders are intently focused on making the best possible choices standing on the foundation of our shared T-Mobile Values. The outcome will be an organization that is structured efficiently and closer to the customer. Leaders will share more information as plans evolve.

These are not easy steps to take — or, I know, to read. We must address our business realities so we can focus on getting T-Mobile back to growth.

Our commitment, as we go through this process, is to provide clear perspective and understandable rationale, be forthright in our communications regarding our decisions, and be respectful and compassionate in our treatment of affected individuals.

Thank you for your ongoing commitment and support.

With sincere appreciation,

Philipp Humm
CEO & President
T-Mobile USA

Umemployed worker photo: Dmitriy Shironosov/Shutterstock