Sprint severance and other job cutting costs hit $150 million

Severance and other costs related to job cuts at Sprint Corp. will total $150 million and reduce earnings by that much in its next quarterly report, the company said Monday.

Job cuts began early this month and are part of a effort to reduce spending throughout the company by $2.5 billion. The job reductions will be “largely completed” by the end of January, Sprint said in a filing with the Securities and Exchange Commission.

January also marks that last month of a generous severance plan that the company said recently it would replace. The current plan generally provides two weeks of pay, plus $1,000, for each year of service. The new plan generally would provide one week of pay per year of service.

Sprint has said any employees notified of a layoff before the end of January would fall under the more generous severance plan regardless of when their last day would be.

Monday’s notice of severance and related job cutting costs is similar to notices Sprint made last year in two different rounds of cutbacks.

In January 2014, Sprint identified $168 million in severance and other charges tied to a job reduction. Those cuts included 300 to 500 retail jobs tied to less profitable Sprint stores the company planned to close that spring.

Sprint identified an additional $160 million in severance and other costs in October 2014 in a new round of job cuts in its information technology, portfolio management, network and technology groups. Those cuts totaled 1,700.

Sprint then said it would eliminate an additional 2,000 jobs as part of a $1.5 billion reduction in spending.

This story was originally published December 21, 2015 at 4:31 PM with the headline "Sprint severance and other job cutting costs hit $150 million."