LITTLE ROCK — Hewlett-Packard Co., which opened a $28 million customer support facility at Conway three years ago, said Monday it plans to lay off about 500 workers at the site.
The company told employees at its customer loyalty center it would provide severance packages and help find other employment for those displaced.
The layoffs are part of the Palo Alto, Calif.-based computer firm’s efforts to streamline operations.
HP Media Relations Officer Sarah Pompei said the layoffs were effective immediately, although some positions will remain for the next few months. She said there should be "no disruption" to any services despite the cutbacks.
"We reaffirm our commitment to providing innovative technology solutions to every community we reach," she said. "As well, HP will be taking steps to help our affected employees during this transition."
The restructuring is part of an announced plan made public in May 2012, which involved significant layoffs at various other facilities, although Conway was not affected at that time.
Pompei said the layoffs announced Monday were a component of the plan "designed to simplify business processes, advance innovation and deliver better results for our customers, employees and shareholders."
The company announced in 2008 it would locate in Conway, and the company moved into the 150,000 square-foot facility located on 180 acres in Meadows Technology Park in January 2010. The facility employs about 1,400 workers and is owned by Conway Development Corporation.
News of the state landing the Hewlett-Packard facility in Conway was heralded as game-changing for the state’s economic reputation. The city’s two colleges and one university were to be a feeder for the tech jobs the center would field.
At the time, as many as 1,500 jobs were expected.
Jamie Gates, senior vice president with the Conway Development Corp, said Monday’s news was not the kind officials enjoy getting.
"Our first thoughts are with the employees who are affected. Thankfully announcements like this have been few and far between in Conway. It’s an example of why communities have to work every day at attracting jobs and growing the economy," Gates told the Log Cabin Democrat newspaper in Conway.
He said HP is still a significant and positive influence on the local economy and that economic developers would continue to promote the Conway facility as a site for growing sectors within the company.
"As an organization we will do what we can to facilitate successful transition for those affected and continue to attract jobs and economic opportunity to Conway," he said.
Conway Mayor Tab Townsell said the news came as a surprise.
"We weren’t expecting this at all," Townsell told the newspaper. "We know the company has had some struggles and had made the company-wide announcement last year, but we didn’t know how that would affect Conway. Obviously it’s something we’d rather not see, and we feel for all of the people affected."
Joe Holmes, spokesman for the Arkansas Economic Development Commission, outlined the incentives HP received when it located in Conway. He said that the payroll incentives were performance-based and would be evaluated for settling-up purposes.
He also anticipated meeting with HP officials in the coming weeks to determine if other state investments might warrant some return to the state.
The incentives included:
—Tax Back, which provided sales and use tax refunds on building materials and taxable machinery.
—Advantage Arkansas, which provides 1 percent income tax credit for payroll for new jobs for 5 years.
—Create Rebate, which provides a cash rebate equal to 5 percent of payroll for 10 years.
—$10 million from the Governor’s Quick Action Closing Fund for infrastructure that will be permanent to the building such as generators, cabling and other needs.
Arkansas News Bureau business columnist Roby Brock contributed to this report.