Circuit City laying off its highest-paid salespeople
The company said it's eliminating jobs that paid "well above" market rates. Those who were fired can apply for the lower pay jobs, a company spokesman said yesterday. He declined to give the wages of the fired workers or the new hires.
The moves will reduce 2008 expenses by $110 million and trim $140 million in annual spending in 2009. Sales may be volatile during the first half of this fiscal year as the new salespeople learn their jobs, the company said yesterday.
The fired employees will get severance pay. The job cuts, as well as plans disclosed last month to close 600 stores and cut 400 jobs, will result in a $145 million pretax charge in the fiscal 2007 fourth quarter.
Circuit City pays about $10 to $11 an hour, on average, said Rick Weinhart, an analyst with BMO Capital Markets Corp. in New York. Entry-level pay probably is close to $8, for inexperienced workers, he said.
Chief executive Philip Schoonover received total compensation of $8.52 million in fiscal 2006, including a salary of $975,000.