In an amendment filed today to its Nov. 13 8-K filing with the SEC, financially challenged Sotheby’s revealed that its planned staff buyouts will result in a net headcount reduction of about 80 staffers. Because of the $40-million cost of the buyouts, which will be charged to the 4th quarter of 2015, it will take a year and a half for the expected savings to compensate for the $40-million hit.
Here is an excerpt from today’s amendment to the 8-K:
Sotheby’s expects to recognize a charge of approximately $40 million in the fourth quarter of 2015 as a result of the [buyout] Programs. This charge includes $4 million of accelerated equity compensation expense and $5 million related to 2015 incentive compensation that would have been paid to participants had they remained with Sotheby’s.
Taking into account the incremental net cost and expected net savings resulting from the Programs on their own, Sotheby’s expects a payback period of approximately 18 months.
Employee transitions under the Programs will commence on Dec. 31, 2015 and occur throughout the coming year. Sotheby’s currently expects that the Programs will result in a net reduction [emphasis added] of approximately 5% of its global headcount of approximately 1,600 employees prior to the implementation of the Programs.
Because some people may be hired to assume the functions of some who are leaving, the actual number of people taking the buyout may well exceed the 5% “net reduction” in headcount (about 80 individuals). So far, I’ve been unable to obtain any details about the total number of buyouts or the nature of the positions involved, let alone the names of some of those leaving.
As reported a week ago by the NY Times‘ Robin Pogrebin, the voluntary buyouts “achieved the company’s required cost savings. That means the auction house will not have to resort to layoffs.”
In sad Sotheby’s-related news, Charles Moffett, former curator at several major museums and former director of the Phillips Collection, who subsequently served as the auction house’s executive vice president and vice chairman of Impressionist, Modern and contemporary art (1998 to 2014), died Thursday of pancreatic cancer.
His exhibitions at the Metropolitan Museum were highlights of my museum-going life…especially one that I tweeted about yesterday, in what I assume to be a unique tribute–how he helped me focus on aesthetics, not obstetrics:
— Lee Rosenbaum (@CultureGrrl) December 14, 2015
Here he is, as photographed (and tweeted) by me in October 2014 at a Sotheby’s presale exhibition—the last time that I saw him:
— Lee Rosenbaum (@CultureGrrl) October 31, 2014