Arkansas Children’s lays off 25, announces cost-saving measures across system due to COVID-19

Arkansas Children’s announced Friday (June 12) it would make a number of cost-saving cuts including layoffs of 25 workers.

“We are collectively living through the most difficult health crisis of our lifetime. 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,” said Fred Scarborough, Executive Vice President and Chief Communications Officer.

The reductions and restrictions include:

• 20% reduction in executive compensation for fiscal year 2021.
• 10% reduction in director compensation for fiscal year 2021.
• Mandatory reduction of all external travel costs through June 2021.
• Elimination of select contracted services.
• Significant reduction of onsite catering and sponsored event expenses.
• 50% reduction in minor equipment expenditures through June 2021.
• 30% reduction in capital expenditures through June 2021.
• Elimination of traditional merit pay program for all staff through June 2021.
• Required Executive Vice President approval for any new hire. Only strategically essential positions may be hired.

Arkansas Children’s also said it would eliminate 42 positions across its footprint. Seventeen (17) of those 42 positions are currently vacant. Twenty-five (25) of the position eliminations affect workers who have already been notified. Arkansas Children’s said it is offering severance benefits and outplacement services to the employees whose positions were eliminated to help them pursue new career opportunities.

“Again, these difficult actions are through no fault of any employee, but rather a direct result of reduced workload due to the impact of COVID-19,” Scarborough said.