Hallmark to lay off 6 to 8 percent of U.S. work force, with some in Lawrence

Company has 700 employees working at Lawrence production plant

Hallmark Cards announced Tuesday that it would be eliminating jobs at its production plants in Lawrence, Topeka and Leavenworth, part of an overall plan that could cut up to 750 jobs from the Kansas City, Mo.-based company.

Hallmark plans to reduce the size of its U.S.-based work force, excluding subsidiaries, during the next six months by 6 percent to 8 percent — translating to 550 to 750 jobs out of the 9,200 full-time employees who work in Hallmark’s personal expressions business.

Hallmark said it would offer a voluntary severance program for eligible, hourly employees in its operations division, which includes company production plants in Lawrence, Topeka and Leavenworth. All eligible employees were informed of the voluntary severance offers beginning Tuesday morning and have two weeks to decide whether to accept.

Hallmark expects as many as 450 jobs to be eliminated from the seven locations in five states that make up the division, including:

• Lawrence, which has 700 employees making Shoebox and other greeting cards, plus ribbons and other products at 101 McDonald Drive.

• Topeka, which has 680 employees making cards and envelopes.

• Leavenworth, which has 405 employees making giftwrap, paper plates and cups, and a variety of Crayola products.

Involuntary cuts will occur during the next month to six months at the seven operations locations, plus Hallmark headquarters in Kansas City, said Julie O’Dell, a Hallmark spokeswoman. The cuts will not affect Hallmark’s U.S.-based subsidiaries, including Crayola and Crown Center.

All affected employees will be provided severance and transition assistance.

“Reducing our work force by this many jobs is something we wish we did not have to do,” said Donald J. Hall Jr., president and CEO. “These actions are all the more difficult and emotional because of the strong and personal culture we share at Hallmark. Despite all the steps we have taken to date to avoid eliminating additional jobs, the state of the economy and its impact on our business require us to take further action.”

Earlier this year, Hallmark had announced that it would be closing its corporate headquarters and all production and distribution centers for the week between Christmas and New Year’s Day, part of a cost-cutting move.

Hallmark reported net revenues of $4.3 billion last year, down from $4.4 billion in 2007. Hallmark expects “additional pressure” on revenues and earnings this year, as the company grapples with declining consumer confidence and spending.

The planned job cuts are intended to address the company’s economic condition and expectations for 2009, O’Dell said.

“Like everybody else, the economy is having an impact on our business,” O’Dell said. “We definitely think we’re taking adequate steps now, but we, too, will have to continue to monitor the climate … and we will react as we need to.

“We’re hopeful that these steps will be enough.”