350 Salaried Employees Given 60 Days' Notice

It was another difficult Friday at Hawker Beechcraft last week as some 350 salaried workers were handed layoff notices they have been expecting since September. The company also announced a timeline for a workforce reduction of about 800 union jobs.

President and CEO Bill Boisture reiterated that the economic recovery had not lived up to projections made earlier this year, and aircraft sales continue to be sluggish. He said it would be at least another year before economic conditions improved to the point that the industry would see significant gains. He said that the union jobs would be gone by August of next year, with much of the work transferred to the HBC facility in Mexico or subcontractors.

Media sources including the Kansas Star and the Wichita Eagle report that the timeline for moving work to other facilities appears to be moving faster than originally anticipated. In a letter to employees, Boisture said the company would:

• Move operations out of Plant I no later than August 2011 and as a result reduce employment by approximately 470.
• Move operations out of Plant II no later than May 2011 and as a result reduce employment by approximately 30.
• Move King Air-related back shop operations out of Plant IV no later than August 2011 and as a result reduce employment by approximately 195.
• Move electrical and upholstery from Building 94 no later than July 2011 and as a result reduce employment by approximately 80 employees.
• Complete the third and final phase of the outsourcing of our Logistic Center operations by January 2011 and as a result reduce union employment by another 45 employees.

The machinists union recently voted down a contract which contained significant pay reductions and benefit cuts, but which the company said made efforts to keep jobs in Wichita.

In the letter, Boisture (pictured) said that "reductions in benefits affecting the salaried, non-union employees of Hawker Beechcraft have saved the company approximately $4.5 million in health care insurance costs and $5.7 million in matching 401(k) contributions. Our salaried, non-union employees have also foregone annual merit salary increases that have saved the company an additional $15 million," over the past 24 months. He also said the senior management team had pledged to take a 10 percent salary cut, and that he personally had reduced his "contractually established" salary by 10 percent as well.

FMI: www.hawkerbeechcraft.com