Employment Tales: PR Firm Says Goodbye, then Says Hello
March 24, 2009
Rob Kuznia--HispanicBusiness.com
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Conventional wisdom holds that when the viability of a company is jeopardized by the lousy economy, it can either lay off employees or give everyone a pay cut.
But a prominent PR and advertising firm in Tucson, Ariz. found a third option: fire the vast majority of the staff and re-hire them as contractors.
LP&G, whose clients include Tuscon Extreme Makeover: Home Edition , fired 15 of its 17 employees and re-hired them as independent contractors. As freelancers, the employees will lose their benefits.
Owner Leslie Perls told the Arizona Star the company had to "adapt or die."
"We are adapting so we can press forward with more great work," she told the paper.
Last year, the company's profits plunged from $6.2 million to $1.7 million, the Tucson Citizen reported. When the company moved into its current office in 2004, it set its sites on contracts worth $250,000 or more, but now handles contracts for as little as $2,500.
To weather the storm, LP&G not only turned its employees into contractors, but also decided to move out of its 5,000-square foot office and into a smaller one.
LP&G is allowing the former staff members to take home their desks and computers, thus sparing the company the additional costs associated with moving and providing the former employees some free equipment.
One of the re-categorized employees, Cindy Jordan-Nowe, told Media Jobs Daily she is grateful just to still be working.
"I see my friends working at other agencies going through weekly layoffs," she said. "That is a slow death that eventually kills the work product. This was our way of doing it differently."
Other clients of the company include University Physicians Healthcare, the Susan G. Komen Foundation and Xood, an energy drink.
LP&G's Web site includes a photo and bio of each of its 17 employees-turned-contractors. Each bio includes an interesting tidbit about the person in question. Jordan-Nowe, for instance, is a former police officer.
Source: HispanicBusiness.com (c) 2009. All rights reserved.
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