AOL Lays Off 700 Employees

AOL Lays Off 700 Employees

In a move to increase its competitiveness and to stem economic losses, America Online Inc. has laid off 700 employees, with the majority at the headquarters in Ashburn.

"Those workforce reductions took place today," AOL spokesman Nicholas Graham said Tuesday. He declined to say how many Ashburn employees lost their jobs. The layoffs also affected workers in Ohio, California and New York.

Last month, AOL’s parent company, Time Warner Inc., notified employees there would be layoffs in early December "to better align our resources and to become nimble and flexible and competitive in the marketplace," he said.

Graham said another reason for the move was to increase the effectiveness of its operations.

"These reductions are part of the transition to a newer structure internally," he said. "The number of jobs today represent less than 5 percent of the AOL Worldwide workforce of 20,000 employees."

AOL Vice Chairman Joe Ripp, AOL President of Broadband Lisa Hook and other top officials lost their jobs in the transition. "Other executives were provided with new titles and direction," Graham said.

The change will better align AOL with the marketplace, he said. "Obviously we’re constantly fine-tuning our business strategy to enable us to provide services and products that our members expect from us."

AOL, which has 22.7 million domestic members and 6.3 million in Europe, provided "outplacement assistance" to help area individuals find new jobs.

"We offered very fair severance that will take them through the holidays and into the next year," he said. Some severance packages extend farther than others, depending on the job, he said. "Each of the departments that are not part of the members service organization were impacted, such as marketing, broadband and technology."

<1b>— Andrea Zentz