Layoffs, Delayed Raises in Publicis Groupe

CHICAGO Starcom here laid off 20 people, or approximately 4 percent of its 700 person staff, citing a need to reduce costs.

“This was a cost-management decision, and while it is never an easy one to make, it puts the company in a stronger financial position,” according to a statement from the agency.

The move comes as Starcom’s sister company, Leo Burnett, said it would delay awarding merit pay raises until at least November, citing “marketplace conditions,” according to an agency representative.

“Leo Burnett USA is postponing merit raises until November,” the representative said. “This was a difficult but necessary business decision.”

The Chicago-based agency, which is owned by French holding company Publicis Groupe, revamped its compensation structure in late 2001, eliminating annual bonuses for all employees in favor of selective merit bonuses.