Convergys Corp’s (NYSE:CVG) office in Lubbock filed a notice with the Texas Workforce Commission saying it will soon be laying off 406 employees. The global outsourcing firm said the call center layoffs are a result of low call volume, a trend that has already claimed hundreds of Convergys jobs in Arizona and Tennessee this year.
Convergys to Lay Off 406 in Lubbock as Low Call Volume Trend Continues
Convergys provides customer service, analytics, technical support, collections, and other outsourcing services. The company has operations in 33 countries. In fiscal 2016, Convergys reported a 20% decrease in net income on flat revenue. In the first half of 2017, total revenue and net income was flat.
Employees at Convergys’ Lubbock location may not have officially been told yet, but the company filed a notice with the Texas Workforce Commission suggesting 406 employees will soon be out of work. The effective layoff date is November 30, 2017. Convergys employees are not represented by a collective bargaining agreement.
According to data from the Texas Workforce Commission, this represents the state’s fifth-largest layoff in 2017 as of this writing.
While Convergys has not provided an official statement on the looming layoffs, Danny Soliz, director of business development at Workforce Solutions, said the layoffs are a part of the closure of the Lubbock office.
Under the WARN Act, companies need to provide 60 days notice before a mass layoff. However, Soliz does not think the layoffs will occur at one time. Rather, they are going to do it in stages, with some in November, December, and January.
Convergys Previous Cut Jobs in 2017 Due to Low Call Volume
Low call volumes have been behind a number of large layoffs at Convergys in 2017. In February, Convergys filed a WARN notice with the Tennessee Department of Labor & Workforce Development for a “permanent closure” of one of its divisions in Clarksville. The closing affected 134 employees and took place on April 10.
Convergys first opened its doors in Clarksville in 1999. The company’s headcount over the years has been between 600 and 1,000.
Fast forward to May, and Convergys announced its second large layoff in Clarksville. This one affected 160 Convergys employees.
Ed Loyd, director of corporate communications, said a client program at the Clarksville contact center would end on July 14, “impacting up to 160 employees due to low call volumes.”
Combined with the February layoffs, these two announcements account for the bulk of Convergys’ workforce. That said, the company did not say how many employees would still be left working at the plant after July 14.
Convergys also eliminated 269 jobs at its Camelback Road facility in Phoenix. The February 2017 layoffs were also prompted by low call volumes.
What does the future hold for Convergys’ employees? Commenting on its second-quarter financial results, president, and CEO Andrea Ayers said call volume fluctuations would continue with its largest communications clients. As a result, the company revised its full-year revenue outlook down to negative four percent to negative two percent, from prior guidance of negative three percent to positive one percent. This points to further layoffs at Convergys in 2018.
“WARN Act Listings,” Texas Workforce Commission, last accessed October 25, 2017.
“WARN and Closure/Layoff Reports,” Tennessee Department of Labor & Workforce Development, last accessed October 25, 2017.
“Convergys Reports Fourth Quarter and Full Year 2016 Results,” Convergys Corp, February 22, 2017.
“Convergys Reports Second Quarter Results,” Convergys Corp, August 8, 2017.
“Convergys to lay off 134 workers,” The Leaf-Chronicle, February 9, 2017.
“Convergys to lay off 160 more workers,” USA Today, May 11, 2017.