Sprint Asking for Layoff Volunteers

Sprint is asking for volunteers to hit the layoff line.

The company is trying to reduce costs and the size of its labor force with a voluntary employee layoff program and a slew of operational reductions, InternetNews.com has learned.

In addition to asking for voluntary layoffs or early retirement in some cases, the nation’s third largest wireless carrier is cutting costs by trimming office supplies, encouraging employees to print less, and minimizing cafeteria services.

Sprint would not comment on how many employees are eligible for the program or the projected labor cost savings. Formal layoffs are not expected before year’s end, the carrier said.

“I can share that one of the company’s primary goals as part of its 2009 budgeting process is to have a cost structure that is better aligned with our business,” Lisa Zimmerman-Mott, a Sprint spokesperson, told InternetNews.com.

“Like all businesses, Sprint is looking at a variety of cost-saving measures, and labor is only one of those costs,” she said.

The voluntary employee “separation” program was first reported by the Kansas City Journal. The volunteer program, which sets a December 3 deadline, is aimed at employees not working in customer-facing roles.

Sprint said its business-planning process will be completed in January 2009. Any decisions about involuntary layoffs won’t be finalized until after then.

The news comes shortly after Sprint’s less-than-stellar third quarter earnings despite revamping subscriber rate plans and service programs in the past few months.

Sprint reported third quarter revenue of $8.8 billion — a 3 percent drop from the previous quarter — which led to a net loss of $326 million, or $0.11 per share.

That’s compared to a $64 million profit and $0.02 per-share profit for the same period a year ago.

The carrier lost 1.3 million subscribers in the quarter and now counts about 50 million customers. By contrast, AT&T’s total subscriber base is 74.9 million, while Verizon Wireless now boasts 84 million subscribers after regulatory approval of its $28 billion acquisition of rural carrier Alltel. The industry’s two top carriers also reported healthy wireless data revenue earnings in the third quarter.

During midday trading, Sprint’s stock was up by 18 cents at $2.42.

Sprint has eliminated the purchase of all but the most essential office supplies, said Zimmerman-Mott. She said the move has reduced office supplies costs by 86 percent in the third quarter 2008, compared to the second quarter 2008, saving $17.55 million.

The carrier has also cut internal printing by two thirds in eliminating cover pages, reducing printers and encouraging employees to print less. Sprint printed 2.5 million sheets in October compared to printing of 8.8 million sheets last February.

The carrier also cut back on air conditioning by increasing internal building temperatures to 75 degrees, compared to the 73 degrees, which saved $200,000 in cooling costs.

Even food costs are under scrutiny as Sprint closed two food service outlets on its Overland Park, Kansas campus, which the carrier said saved half a million this year.