Entertainment Partners Hit With "Significant" Layoffs
The formerly employee-owned company sold itself to a private equity firm in March, but had been planning a reorganization and reduction in force for several months prior to that.
Entertainment Partners, the large payroll house that sold itself in March to a private equity firm, executed a reorganization and layoffs across the company July 24, The Hollywood Reporter has learned. The number of people terminated was described as “significant” by a source speaking on condition of anonymity, who said he had spoken to an EP executive. An EP spokesman declined to comment.
Employees, who numbered about 1,100 prior to the layoffs, received word of the moves on an internal blog post from EP president and CEO Mark Goldstein. A company source told The Hollywood Reporter that the reorganization and reduction in force had been in the planning stages since the beginning of the year.
“Since January, the Executives and I have been planning and discussing our size and scale,” Goldstein wrote. “With the sale behind us we have refocused on the future… These plans will … unfortunately, cause the elimination of positions across many of our teams.”
In the post, Goldstein touted the company’s SmartStudio cloud-based services that support a wide range of production functions, including a SAG-AFTRA residuals direct deposit system developed by software developer Exactuals and EP that went live in April. With eight offices in U.S. and Canadian production centers, the company also advises on tax incentives and operates Central Casting for casting background actors. (Disclosure: EP engaged and paid this reporter in late 2017 and early 2018 to deliver an eight-hour course on residuals to its staff.)
Prior to the March 26 sale to TPG Capital, EP was 100% employee owned, describing itself as one of just 4,000 U.S. companies that were. “We care about [the employee-ownership structure] a great deal,” said a now-shuttered EP webpage. “Our culture is grounded in the ownership philosophy….”
That structure changed with the acquisition by TPG, but Goldstein’s post also noted that the sale of the formerly employee-owned company “allowed us to reward everyone.” In addition, in connection with the layoffs he said the company was providing “generous severance packages, outplacement, and other benefits to help with the transition to new employment.”
Read Goldstein’s July 24 note:
At the beginning of this year we introduced a new vision for the company: to be THE production partner in the evolution of entertainment. Our SmartStudio continues to be widely embraced, our AWS move to the cloud has been extremely successful, and our new updated Movie Magic product will soon bring legacy users across the globe into a modern, cloud-based, multi-user reality. Overall, our continuing investment in technology these past several years has really begun to pay off and our clients are noticing. We have observed significant process improvements, yielded greater efficiencies, improved our delivery of our service to our clients and have been infusing innovation throughout our culture and environment as applicable to keep pace with our vision.
We previously set the course for the future guided by goals, initiatives, and key performance indicators (KPIs) this year that will guide us into the future. We committed to making this year (and all subsequent years) the year of client first and have rethought our service structure and roles to deliver on this promise. Operational efficiency, streamlining of our client experience, and a reduction in touchpoints for simplicity of working with us have been our guiding directives.
We’ve made great progress in the first half of this year. The consummation of our new ownership by TPG allowed us to reward everyone for the extraordinary accomplishments over the last 15 years — something we should all be very proud of. Since January, the Executives and I have been planning and discussing our size and scale to make sure we are both aligned correctly and staffed appropriately for the work ahead to deliver on our client-first culture. With the sale behind us we have refocused on the future, and each Executive has worked on finalizing a realignment plan necessary to maintain and accelerate our momentum and with the significant advancements in technology, a technology plan based on the investments we want to make. These plans will result in moving some departments to a new COE [“Center of Excellence,” i.e. a department or division], more focus on certain technology initiatives and, unfortunately, cause the elimination of positions across many of our teams.
Today, we are beginning the communication of these changes with our employees. We have had tremendous contributions from our employees for many years, so I would like to thank all those who are being impacted for their efforts. For those who are leaving we are providing generous severance packages, outplacement, and other benefits to help with the transition to new employment. Our focus will be on providing the highest level of support and care to everyone who is affected by these changes.
We will soon be holding COE meetings to further discuss our progress and our needs going forward and will hold a companywide Town Hall session in a couple of weeks to reiterate what we must do to make our client-first vision the norm and keep everyone focused on our goals.
Change is a necessary part of any evolution, and frequently requires tough decisions. Our market has taken note of our invigorated energy and commitment and the gap between us as the market leader and everyone else in our space continues to widen. Your ongoing efforts are going to propel us even further ahead. Thank you in advance for your patience as we implement the organizational changes this week and please don’t hesitate to talk with your immediate supervisor, COE Executive, or the HR team if you have any questions or concerns.
7/29/2019 12:54 p.m. clarified timing of layoff plans vis-a-vis sale to TPG