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IDT opts to shut Newark facility, meaning layoffs
Thursday, April 27, 2006
BY TOM JOHNSON
Star-Ledger Staff
IDT, the Newark telecommunications and entertainment company, yesterday said it will close down its call center in the city, a decision that will cost more than 300 employees their jobs.
"This was a difficult decision, no doubt about it," IDT Chief Executive Jim Courter said. "We have been thinking about it for a period of time."
In the end, the job cuts were probably ordained after the company stopped marketing bundled phone services to consumers after an adverse regulatory decision involving leasing of local phone lines. The layoffs will be effective in 60 days,
"We don't need the number of people in the call centers that we used to," Courter said. "That business is being slowly curtailed over time."
The company's consumer phone services business has been declining ever since federal regulators allowed the Baby Bells to charge more to lease their local phone networks. In the past year, the number of customers buying its unlimited bundled local and long-distance service dropped to 188,000, from 300,000.
The workers who will be laid off were notified yesterday as they arrived to work at the three scheduled shifts at the call center at 540 Broad St.
Courter said they will be offered severance packages ranging from a couple of months' pay to higher amounts, depending upon their length of service.
The company plans to bring in an outside consultant to help workers with future job placement and the state Department of Labor closer to when the layoffs will actually occur, he said.
IDT, which posted a loss of $58.7 million in the second quarter, has about 5,000 employees, about half of whom work in New Jersey. Its core business is selling prepaid phone cards, but in recent years, it has branched out into the entertainment field, including making animated feature films.
The company is expected to report a future charge against earnings of as much as $3 million to account for the cost of the layoffs.
"It's important for IDT to be an efficient company and to be operationally profitable," Courter said. "This will go a ways toward achieving that."
Tom Johnson covers utilities and telecommunications. He may be reached at tjohnson@starledger.com or (973) 392-5972.
© 2006 The Star Ledger
© 2006 NJ.com All Rights Reserved.
IDT opts to shut Newark facility, meaning layoffs
Thursday, April 27, 2006
BY TOM JOHNSON
Star-Ledger Staff
IDT, the Newark telecommunications and entertainment company, yesterday said it will close down its call center in the city, a decision that will cost more than 300 employees their jobs.
"This was a difficult decision, no doubt about it," IDT Chief Executive Jim Courter said. "We have been thinking about it for a period of time."
In the end, the job cuts were probably ordained after the company stopped marketing bundled phone services to consumers after an adverse regulatory decision involving leasing of local phone lines. The layoffs will be effective in 60 days,
"We don't need the number of people in the call centers that we used to," Courter said. "That business is being slowly curtailed over time."
The company's consumer phone services business has been declining ever since federal regulators allowed the Baby Bells to charge more to lease their local phone networks. In the past year, the number of customers buying its unlimited bundled local and long-distance service dropped to 188,000, from 300,000.
The workers who will be laid off were notified yesterday as they arrived to work at the three scheduled shifts at the call center at 540 Broad St.
Courter said they will be offered severance packages ranging from a couple of months' pay to higher amounts, depending upon their length of service.
The company plans to bring in an outside consultant to help workers with future job placement and the state Department of Labor closer to when the layoffs will actually occur, he said.
IDT, which posted a loss of $58.7 million in the second quarter, has about 5,000 employees, about half of whom work in New Jersey. Its core business is selling prepaid phone cards, but in recent years, it has branched out into the entertainment field, including making animated feature films.
The company is expected to report a future charge against earnings of as much as $3 million to account for the cost of the layoffs.
"It's important for IDT to be an efficient company and to be operationally profitable," Courter said. "This will go a ways toward achieving that."
Tom Johnson covers utilities and telecommunications. He may be reached at tjohnson@starledger.com or (973) 392-5972.
© 2006 The Star Ledger
© 2006 NJ.com All Rights Reserved.
posted by Jones Lang LaSalle NJ News Blog at 9:47 AM
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