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6/3/2004

Underwriters Laboratories doubles layoff plan

By Mark Harrington
Newsday

Underwriters Laboratories Inc., the product-safety testing giant, told employees Tuesday it plans to more than double planned U.S. layoffs this year after averting a “critical cash crisis.”

The Northbrook, Ill.-based company, which certifies the safety of everything from toasters to industrial equipment, told its 3,800-employee U.S. workforce Tuesday that it now plans to dismiss 750 mostly U.S. workers this year. It had previously expected to cut only 300 jobs in 2004. The layoffs are in addition to expected cuts in its internal computer services operations, 40 percent of which will be outsourced by year-end.

UL, which has enacted a controversial transition to overseas product certification, has cut its U.S. workforce 16 percent over three years, to 3,839 people, according to its annual report, while it has largely expanded overseas, particularly in the Far East and Europe.

In a memo to workers Tuesday, Loring Knoblauch, the not-for-profit company’s chief executive, said that while UL has done “a lot of restructuring” during his tenure, “there is still a lot that needs to happen.”

“The restructuring will be designed to properly size our U.S. operations to the realistic future demands of our business,” Knoblauch told employees.

UL locations across the country, most notably in Santa Clara, Calif., have seen their worker ranks reduced as the company attempts to build a large overseas operation in order to locate nearer its clients, even though some large clients are opposed to the idea. Other large offices among a dozen in the United States are in Research Triangle Park, N.C., Camas, Wash., and Novi, Mich.

Company spokesman Paul Baker said UL “does not intend to close any of our facilities.”

One of the aims of the job cuts is to improve the company’s cash position, Knoblauch indicated.