Arkansas Children’s Lays Off 25, Cuts Exec Pay

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Arkansas Children’s, which operates hospitals in Little Rock and Springdale, announced Friday that it had laid off 25 employees, cut executive compensation and taken other “cost-saving measures” in response to the impact of the COVID-19 pandemic.

“We are collectively living through the most difficult health crisis of our lifetime,” said the statement from Fred Scarborough, executive vice president and chief communications officer. “As a direct result of the impact of COVID-19, Arkansas Children’s has experienced a decrease in patient volumes and a reduction in workload for some team members. There is every indication that these changes in volume and workload will last through June 2021.”

Forty-two positions were eliminated across the nonprofit organization, of which 17 were already vacant. The 25 employees being laid off have been offered “severance benefits and outplacement services … to help them pursue new career opportunities.”

Executive compensation will be reduced 20% for the fiscal year that begins July 1, and director compensation will be reduced by 10%.

Other actions being taken for the upcoming fiscal year include:

  • Mandatory reduction of all external travel costs;
  • Elimination of select contracted services;
  • Significant reduction of onsite catering and sponsored event expenses;
  • 50% reduction in minor equipment expenditures;
  • 30% reduction in capital expenditures;
  • Elimination of traditional merit pay program for all staff; and
  • New hiring limited to “strategically essential positions.”