Cendant to close, 220 jobs lost

By Megan R. Harrell

STAR STAFF
mharell@starhq.com

   Rumors that Cendant Corporation might close its doors in Elizabethton were confirmed Tuesday afternoon. The local hotel reservation company will take its final call Jan. 24, 2003.
   Employees were called together to receive the bad news in what could be deemed poor timing on the part of the national corporation. All of the facility's 220 employees learned they would lose their jobs just two days before Thanksgiving, and emotions were raw as they left yesterday's meeting.
   Some of the employees have worked at the call center since it came to Elizabethton seven years ago, but were unable to discuss the closing's impact because of a gag order issued by the company. Employees feared losing their severance packages if they spoke to members of the media.
   Cendant's closing delivers another blow to a county and city that are still writhing from Alcoa's closing last year. Alcoa put 240 people out of jobs when they began making layoffs last February.
   Carter County and City of Elizabethton officials would like to offset the economic impact of Cendant's closing but have been kept in the dark. County Executive Dale Fair and City Manager, Charles Stahl still had not been officially informed of the closing as of late Tuesday afternoon.
   "We have no information in terms of written communication to my knowledge or verbal information about the status," Stahl said. "Any information of a business' closing is terrible news for our community, and is hard to accept even recognizing that the national economy may be a factor here."
   Stahl stated that it is especially difficult for the employees and their families who are affected by the closing during the holiday season.
   As County Executive, Fair is responsible for economic development in Carter County. Though he has not received any official information, he is working to lessen the economic impact of Cendant's closing.
   "I have been working in the background assuming the rumors were true, because I hope to have good news about the same time the bad news comes out officially," Fair said. "We have been talking with companies but we need to know when they are going to leave because we need to know when we can rent the building out."
   No local or corporate press releases were issued pertaining to the call center's closing; however, Rich Roberts, spokesman for the Cendant Hotel Group, did offer some answers. He stated the closing is the result of an overall downward trend in the travel industry.
   "The reason for the closing is that there has been an on going decline in our call volume over the last three and a half years, and it has not been just in Elizabethton," Roberts said. "Our calls volume has gone from 33 million a year to 15 million a year and as a consequence we have had to consolidate our facilities for handling these calls."
   Cendant blames the Internet for a decline in its call volume. Roberts noted that consumers have chosen to book vacations over the net because of its speed and easy access.
   He said the company needed to make cutbacks in order to stay afloat, and Elizabethton's facility was chosen because of its relatively small size in comparison to other centers. The company closed call centers in Colorado and Arizona last year.
   "Cendant regrets the need to do this. Closing a facility and terminating employees is always a last resort," Roberts said. "What we have encountered is a consumer choice and it is across a broad spectrum of the travel industry."
   Cendant has not attributed the call center closings to recent negative headlines it has received for an alleged probe by the U.S. Securities and Exchange Commission. The New York Times implicated Cendant, along with AOL Time Warner Inc., in unethical transactions with an online home listings company. Cendant Corp. issued a press release Tuesday denouncing the allegations.
   Other local companies owned by Cendant are experiencing consolidations instead of closings. Fairfield Resort facilities in the Tri-Cities will be consolidated at the beginning of December, and additional jobs will become available.
   As part of their severance agreements employees laid off at the Elizabethton location will be eligible for employment at other Cendant companies. They will be paid for accrued, unused vacation time. Cendant will pay for education assistance that has already been approved or in progress.
   Severance packages vary depending on employees' positions and employment status.