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Number of Layoffs at HP Unclear

Rumors continue to swirl about layoffs at Hewlett-Packard’s Rio Rancho customer technical support center, and while declining to give numbers, the company has confirmed the facility is feeling the effect of its workforce reduction announced earlier this year.

The Palo Alto, Calif.-based high tech giant opened its 218,000-square-foot Rio Rancho facility in late 2009 with a commitment to have 1,350 employees by the end of this year.

If HP doesn’t meet that goal, the company’s agreement with the city requires it to repay a portion of the $2.2 million in land and building incentives it received from Rio Rancho.

But figures provided by the city show the amount is minuscule in relation to the value of the incentive.

For example, if HP was 10 percent short of its hiring target by the end of this year, the company would in 2013 pay a total penalty to the city of $16,484 based upon the formula in the project agreement.

If the company continued to miss its hiring target it would have to pay penalties in successive years based on the amount of the shortfall, city spokesman Peter Wells said.

Shortly after HP announced in late May that it would cut 8 percent of its 350,000 worldwide workforce by October 2014 and use the savings to develop new products and services, the Journal began receiving emails from Rio Rancho employees who said they and coworkers were being laid off. Although none of the employees would allow their names to be used publicly, they indicated about 50 to 60 employees were affected.

City Councilor Chuck Wilkins, a Farmers insurance agent, said he has had “five or six” clients say they were being laid off. He said two of them who had relocated to Rio Rancho when HP closed a facility in Colorado Springs, told him they were returning to Colorado.

At first, HP would not comment on whether the worldwide staff reduction affected Rio Rancho. The rumors continued and in mid-July a corporate spokesman confirmed that there had been layoffs in Rio Rancho but still declined to give numbers.

By law, HP is required to provide quarterly reports to the state Department of Workforce Solutions which show the numbers of employees at the Rio Rancho facility. The Department declined a Journal public records request to inspect the most recent quarterly reports saying the information was protected from disclosure by the state Unemployment Compensation law.