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MCI Cutting 2,000 Jobs, Closing Centers

Posted on: Tuesday, 29 June 2004, 06:00 CDT

MCI Inc. announced Friday its third major round of job cuts this year -- the elimination of 2,000 positions at four U.S. call centers.

MCI spokesman Peter Lucht said the company will close call centers in Colorado Springs, Colo., and Wichita. Operations in Greenville, S.C., and Iowa City, Iowa, will be reduced.

The job cuts will take effect over the next few months.

MCI executives refused comment on what effects, if any, the call center closings would have on MCI operations in Tulsa. MCI employs just under 1,900 workers in Oklahoma, most of them at Cherokee Industrial Park.

Earlier this month, MCI laid off 200 Tulsa-based employees as part of an ongoing restructuring to reduce costs and make the telecommunications giant more competitive.

The Oklahoma layoffs have come despite the company's agreement with Oklahoma Attorney General Drew Edmondson to hire 160 people a year in the state for the next 10 years.

According to the agreement, if the Oklahoma jobs don't average $35,000 in salary, MCI will pay a penalty of 5 percent, or $1,750 per job. In return, Edmondson agreed to drop criminal fraud charges against the company and six of its former executives.

In March, MCI closed call centers in Denver, Phoenix and Niles, Ohio, and scaled back operations in Alpharetta, Ga., Colorado Springs and Springfield, Mo. The closings affected 4,000 workers.

Last month, the company announced 7,500 job cuts throughout its operations.

So far this year, MCI has eliminated 14,000 jobs, reducing its work force to about 40,000 people.

The call centers have been particularly affected by the job cuts due to the impact of federal "do not call" legislation, Lucht said.

"Telecommunications market realities, including industry, economic and regulatory conditions, require MCI to take these actions as part of its ongoing cost reduction effort," Lucht said. "While reductions like these are always a last resort, MCI must continue to revamp its cost structure."

MCI, which emerged from bankruptcy protection this year, lost $388 million in the first three months of 2004. The company previously said that the job cuts announced in March and May would save $600 million a year and allow it to return to profitability in the second half of 2004.

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