MCI Communications Corp. is drastically pruning its Washington litigation support division in the wake of a settlement of two antitrust suits with American Telephone & Telegraph Co. and the regional Bell operating companies two days ago.
One source at the 2000 M Street NW division, which has 217 employes, said MCI "fired about 20 [part-time] people today and gave full-time people a week to find other jobs."
Another source at the division said many in the division were hired "knowing full well that, when the task was over, the job was over." MCI is going to try to find other jobs in the company for some of the employes but "clearly we can't accommodate everyone," the source said.
Analysts yesterday also estimated that MCI will receive no more than $200 million in the settlement with AT&T and the regional companies, enough to cover legal expenses for the last several years. The settlement "can't be much more than $200 million," said John Bain, an analyst with Shearson Lehman Bros. Inc. AT&T is liable for 18 percent of any settlement, with the rest split among the other regional phone companies, he said.
MCI spokesman John Houser said yesterday that of 117 of the 217 employes at the 2000 M St. NW division were full time and the rest were part time or were hired on a limited contractual basis. "Part-time and contract employes are being released over the course of the week," he said.
"We will have a skeleton crew of 10 to 12 people and will make every attempt to find employment within the company" for all full-time employes, he said. Some of the employes might be accommodated in regulatory departments of MCI divisions around the country, while others will be eligible for other jobs at MCI, he said.
MCI would not estimate how much the division, which had grown exponentially over the past three years to handle the suits, was costing the company. He said more than $1 million a year would be saved by eliminating the part-time personnel.