Comcast reportedly fired about 500 salespeople shortly before Christmas, despite claiming that the company would create thousands of new jobs in exchange for a big tax cut.
Comcast apparently tried to keep the firings secret while it lobbied for the tax cut that was eventually passed into law by the Republican-controlled Congress and signed by President Trump in late December. The Philadelphia Inquirer revealed the Comcast firings this week in an article based on information from an anonymous former employee, Comcast documents, and other sources in the company.
The former employee who talked to the Inquirer "could not be identified because of a nondisclosure agreement as part of a severance package," the article said. The Inquirer headline notes that Comcast was able to implement the firings "quietly," avoiding any press coverage until this week.
Ars asked Comcast today if all 500 fired employees had to sign those nondisclosure agreements, but we didn't receive an answer. We also asked why the firings were necessary given that the tax cut was supposed to create more Comcast jobs, and we asked if Comcast has specific plans to create jobs in other areas.
Comcast gave us this statement but offered no further details: "Periodically, we reorganize groups of employees and adjust our sales tactics and talent. This change in the Central Division is an example of this practice and occurred in the context of our adding hundreds of frontline and sales employees. All these employees were offered generous severance and an opportunity to apply for other jobs at Comcast."
A Comcast spokesperson also confirmed the firings to the Inquirer.
“Thousands of new direct and indirect jobs”
The firings happened around December 15. On December 20, Comcast announced that, because of the pending tax cut and recent repeal of net neutrality rules, it would give "special bonuses" of $1,000 to more than 100,000 employees and invest more than $50 billion in infrastructure over the next five years.
"With these investments, we expect to add thousands of new direct and indirect jobs," Comcast said at the time.
We examined Comcast's investment claims in an article on December 21. As it turns out, Comcast's annual investments already soared during the two-plus years that net neutrality rules were on the books, and the $50 billion amount could be achieved if those investments simply continued increasing by a modest amount.
Comcast was one of the most active companies lobbying for lower corporate tax rates in 2017, Vox reported shortly before the tax changes passed in December.
The 500 fired employees were "managers, supervisors, and direct sales people in Chicago, Florida, and other parts of Comcast's Central region, mostly in the Midwest and Southeastern United States," the Inquirer reported.
These include many salespeople "who walk neighborhoods and troll apartment complexes to pitch [Comcast's] telecom and TV services." When Comcast announced the firings internally, the employees were told that a new direct sales system requires fewer humans, the fired employee told the Inquirer.
Comcast explained the firings to the Inquirer with this statement:
The Central Division is creating a new territory-based sales model that will connect more closely with residential prospects and customers in their communities. By giving highly trained sales professionals direct responsibility for entire neighborhoods, we can provide a better experience for those who are interested in our services, during and after the sale.
Comcast also told the Inquirer that terminated employees can receive a "$1,000 supplemental severance payment" that matches the size of the bonus given to workers who are still employed.
"Comcast offered severance and several months of health-care coverage, [the Comcast spokesperson] said," according to the Inquirer.
It stands to reason that more firings could follow if Comcast rolls the same new sales model out to other parts of its nationwide territory. The company, including the NBCUniversal division, has about 159,000 employees.
The Inquirer article included personal stories about the fired Comcast workers:
One employee kept holding his head and saying, "I can't believe it. I can't believe it." Another worried about how to find new healthcare coverage. A third employee was close to purchasing a new home and feared the personal income hit.
AT&T lays off workers after saying tax cut would create jobs
Comcast isn't the only company whose actions contradict statements that workers would benefit from the corporate tax cut. AT&T claimed that it would invest another $1 billion because of the tax cut and said that "research tells us that every $1 billion in capital invested in telecom creates about 7,000 good jobs for the middle class."
But as we wrote yesterday, AT&T is now laying off thousands of employees and is facing a lawsuit from a workers' union that is trying to stop the mass layoffs.