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Wednesday, December 10, 2008

Rumor Patrol: PTO and Staff Reductions

Its been a week since our last round of staff reductions; long enough hopefully for a little dust to settle. I want to address two rumors that went around last week in the emotions of the moment and make sure that the air is cleared and facts are known as to the role that our Paid Time Off (PTO) program played in these terminations.

For those of you reading from outside the company, about three weeks prior to these terminations we made an intentional move away from paying for unused PTO; converting instead to a "use-it-or-lose-it" policy. This move will save us hundreds of thousands of dollars next year, or the equivalent of about 40 jobs. We announced this change both in writing and at informational meetings, most of which I conducted, a few days prior to our staff reductions.

The two rumors or comments that I've heard about this policy change are (1) that we said we'd do this instead of cutting jobs but then cut jobs anyway, and (2) we did this to avoid having to pay terminated people their PTO. Here are the facts:

1. We said this move "saves 40 jobs", and it did. We never discussed staff reductions in the PTO meetings or communications, nor did we play cute with our language in order to infer that we wouldn't cut staff. This policy change did reduce the body count from last week, and I continue to believe it was the right move.

2. Every employee who was terminated last week will receive full payout for their accrued but unused PTO on the December 12 pay date. The changes in the PTO policy came mid-year with a forfeit date of December 31st, 2008 for all unused PTO hours. As such, we believe this time is considered wages earned under Tennessee Wage and Hour law. The policy change did not cost any of these 54 terminated employees one dime.

I hope this sets the record straight. If you have any questions or comments that you want to say to everyone, please comment below. If you want to communicate directly with me, please use my company email address:

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