New owners don't want to deal with entrenched bad habits. Easier to hire new people and teach them THEIR way of doing things.
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14577.....so, they hit numbers for a company that is being liquidated for not following rules and regulations. As a business owner, I don't want those types of employees, even if some are "not guilty." If you make a premium salary, I show you the door and bring in your replacement for much less. I don't have to un teach CCI (yes, even with you I would have to un teach CCI). With all the bad press and crap reputation, it's a reclamation project as is. Higher salary=longer tenure=first out.
This is something that CCi learned firsthand. Some of the acquisition schools became a huge PITA and never came round to the CCi way (which, believe it or not, was far superior to their old habits). The downtown Atlanta school springs to mind. It had almost constant turnover of presidents and education directors because the long-term staff they had inherited in education & admissions were so stubborn and disgruntled over any change. I imagine the other companies who could be in a position to purchase us have had similar experiences. It's sad, but sometimes it's best to clean house and start from scratch. Only the most valuable (hard to replace) employees would remain.
fire sale
Liquidation of a firm's assets at prices far below their fair market value (FMV) to achieve a quick sale, either to avoid a financial disaster or to satisfy the debts of an insolvent or bankrupt firm. Banks and other lenders usually value a firm assets at their fire sale value to judge their worth as collateral.
14589 so true. Months ago our DOA was told to staff up but when they told her what she could offer she was so embarrassed. $12/hr. What an insult to the applicant and those already doing the job.
14577 that's IF they start them at 40k. No experience and they are likely to try to get them at 32k or less. You have some reps making 70-80k along side reps brought in for a lot less years later but producing the same numbers now. There is no expense in training anymore and the expectation is that they ramp up and start enrolling within a month...and again no bad habits to break or know it all attitude.
Replying to 14509. So for 10k difference plus the cost to train a fresh employee, its better to layoff someone seasoned consistent with their numbers than to hope for the best in a newbie? Come on. Then put into play how long they even stay at the job.
Do these for profits have tenure? I thought everyone was on short term contracts, no benefits, etc...
In some departments there won't be anyone left over 50K. They already started cleaning house before the ish hit the fan...and still at it. Folks are being called to the carpet for their production ON YESTERDAY (Monday 6/23)...Like really? You tell us sell or close are the only options and much of the future is unknown but you still expect smiling and dialing and more importantly expect me to LIE TO MY STUDENTS AND POTENTIAL STUDENTS ABOUT THE POSSIBILITIES 8-10 months from now if they take this step. REALLY.
Right..just like when Barclay's bought Lehman Bros and JP Morgan bought Bear Sterns
It completely depends on the background of the buyer. If the purchasing company already is in higher-ed, then they will likely just be buying the OPEID's. It is also very possible there are multiple buyers for specific entities.
Disagree 14504...the initial poster is essentially right, for better or for worse. The premium dollars tenured people make will be used to help train the new staff. Why keep a holdover from CCI at $52k when they can hire a new person they can train fresh at $40k? I understand what you are implying, but new owners won't.
Thats not always the case. New owners could also keep the most tenured. Not all tenured people have bad habits. They show loyalty to a company and it will be less expensive to have to hire and train new employees.