Last week, The Philadelphia Inquirer reported:
"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, were terminated around Dec. 15... More than 500 sales employees were terminated, company sources said... Comcast has not reorganized the direct sales forces and approach in the company’s two other big divisions, which include Pennsylvania, New Jersey, and Delaware. Comcast/NBCUniversal employs about 159,000.
In late December, Comcast announced that it would hand out $1,000 bonuses to full-time employees, in response to the Trump tax cut that will slash its corporate tax rate. The fired employees will be eligible for a “$1,000 supplemental severance payment,” Comcast said... Comcast direct sales employees earned $50,000 to $100,000 through a low base salary and commissions, the terminated employee said. The commissions ranged between roughly $75 for a new Internet Plus customer to $350 for a new customer who ordered a triple-play package with home security, the former employee said. Internet Plus is a package of television and broadband services..."
Reportedly, fired employees received severance pay only if they accepted non-disclosure agreements. Also, Comcast fired about 405 workers in Georgia.
Context matters. Earlier this week, Vox reported in December before the tax bill was passed:
"... the prospect for a deal on tax reform looking promising, lobbying reached a pinnacle this year, with 2,065 groups pushing their cause, according to reports published by the nonpartisan Center for Responsive Politics. The efforts are employing more than 6,000 lobbyists, the nonpartisan Public Citizen counted. The four organizations that reported the most lobbying activity on tax issues so far this year are Fortune 500 companies with a huge stake in the outcome: Comcast, Microsoft, Altria Group (formerly Philip Morris), and NextEra Energy."
Many politicians have repeated claims that tax cuts will create new jobs, and that repeal of net neutrality rules would encourage investment by ISPs. And, after the U.S. Federal Communications Commission (FCC) voted in December to repeal existing net neutrality rules, Comcast issued this statement:
"We commend Chairman Pai for his leadership and FCC Commissioners O’Reilly and Carr for their support in adopting the Restoring Internet Freedom Order, returning to a regulatory environment that allowed the Internet to thrive for decades by eliminating burdensome Title II regulations and opening the door for increased investment and digital innovation. Today’s action does not mark the ‘end of the Internet as we know it;’ rather it heralds in a new era of light regulation that will benefit consumers."
So, let's summarize events. After receiving two huge benefits (e.g., tax cuts, repeal of net neutrality rules), Comcast immediately terminated workers. Ars Technica asked Comcast why they fired workers when tax cuts were supposed to create new jobs:
"... 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." "
One of the claims by corporate ISPs and by FCC Chairman Ajit Pai has been that net neutrality rules killed infrastructure investments by telecoms. Ars analyzed this claim:
"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."
So, a few workers received bigger bonuses while others lost their jobs. And, it is worse. AT&T fired about 700 workers after promising to increase investments by $1 billion of Congress passed the tax cuts bill. Congress did, and AT&T didn't wait to terminate workers.
One can conclude:
- The investment claims, by ISPs and advocates of repealing net neutrality rules, were bogus,
- Voters either didn't pay attention or were duped by claims that net neutrality rules killed investments by telecoms,
- Voters were duped during the 2016 election into believing claims that tax cuts would create jobs,
- Voters accepted these job-creation promises without demanding any guarantees, and
- Tax cuts are being used to reward employees and managers with bigger bonuses.
The bigger bonuses are great, if you have a job. Regardless, we now see the results: tax cuts help companies and fewer jobs hurt workers. Repeal of net neutrality rules will hurt public libraries, the poor, and disabled persons. And, there's more to come as ISPs roll out their revised broadband services (with higher prices) without net neutrality rules.
Yes, this stinks. What do you think? Is this what you expected?