Faced with a slow recovery in the radio advertising market, Westwood One, already reeling from financial difficulties, instituted further cost reductions to lower operating expenses.
The plan, announced Tuesday (Sept. 29) calls for a one-week furlough (no work, no pay for five days) and salary cuts equal to five days spread over 10 week. In total, employees will be faced with 10 unpaid days.
The cuts are on top of recent salary reductions between 5 and 15 percent, and a number of reorganization moves.
Despite the various initiatives, Westwood’s president and CEO Rod Sherwood, told employees in an internal memo that it wasn’t enough.
“In spite of all our efforts, and the sacrifices our employees have made, we are not yet experiencing the kind of revenue growth we need to meet our financial goals and support our current cost structure,” Sherwood said. “We have experienced a revenue shortfall this third quarter, and we face continued uncertainty in the fourth quarter. Moreover, no one can accurately predict when a sustainable recovery in the advertising marketplace and the radio business will begin.”
In addition to the compensation cuts, the company also put in place a 2010 performance bonus plan that allows employees to earn an amount equal to five days pay plus an additional 10 percent bonus, and one additional paid vacation day in 2010.