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Rusty delivers a public mea culpa on layoffs: ‘We’ve made the cuts that I think were necessary. Those were my responsibilities’

March 9, 2012

Rusty Gregory. Photo/Aleksandra Gajewski

Rusty Gregory, the CEO of Mammoth Mountain Ski Area, visited the Town Council Wednesday to clarify his decision to lay off 75 year-round workers last week.

It was very much a mea culpa.
 
“Most importantly I want to be personally accountable to you, the Town Council, and you in the community for the totality of my actions,” he said.
 
Gregory’s presentation of what, exactly, happened on the ski hill this year was loaded. He included an explanation of Mammoth Mountain’s relationships with its banks and lenders. He revealed skier numbers. He discussed the company’s new advertising strategy using RFID information and its continued commitment to air service.
 
But most of all, he disclosed his own responsibility for the layoffs, the cutback in hours and the pay cuts employees at Mammoth Mountain have endured.
 
“We did much, much better than our peers in the West and in Utah and Colorado. But all that did was made us the tallest man in a midget contest. All of us are struggling rather significantly.”
 
Even so, he said, he took it personally.
 
“The blogs were saying,  ‘Oh, it’s Barry Sternlicht who must have done this, or the banks must have done this.’ I don’t want to hide the fact that this was anybody’s decision but mine.
 
“I try not to read the blogs too much because they reflect the angst of the community during times like this. But my job is to be the lightning rod for those types of comments when severe action like this is taken. It goes with the territory. 
 
“The steps that we took this year have been very severe, and we had no choice but to cut the jobs of 75 year-round employees with an average length of time with the company of 10 years, and we had four employees who’d been with the company for over 40 years, whose jobs were terminated. It’s been a very painful process.”
 
In another part of the presentation, Gregory addressed the future in simple and dramatic terms.
 
“We will live to fight another day and that will be next year, when the winter comes back. Yes, we could have a drought next winter, that’s the next question: What happens if this happens twice?
 
“The answer is that I don’t have a clue if this happens twice.”
 
As for the transparency of the company, he said, “Those of you who are interested in the financial statements can sit down with me and go over them, whether you’re a member of the town council or staff or a community member at large—the ones who find me doing something wrong. I could use the help.
 
“As somebody who’s been in this community a long time, I know the penalty of not acting strongly on things that are challenging and hoping they go away in the hopes in salvaging some of my friends and popularity. I know that’s a very risky thing to do.
 
“So we’ve made the cuts that I think were necessary. Those were my responsibilities. My partners didn’t encourage me to do this, other than to say what the hell are you going to do now?” 
 
Gregory’s comments went over well with members of the council.
 
“I really appreciate you coming here this evening and explaining this as best you can what went on at the mountain,” said councilmember John Eastman.
 
“I think it’s important for your credibility and the mountain’s credibility to have this communication that you gave us this evening, so thank you for that.  
 
“The other thing I wanted to say is that yes, when you affect the lives of individuals, obviously you’re going to take heat. 
 
“It wasn’t your fault that we had a drought this year. I also wanted to mention that your snowmaking crew did a great, great job and so I would make the argument that as bad as the season was this year, it would have been a whole lot worse if the mountain had not made the commitment to snowmaking this winter, so thank you for that.”
 
“Everything we’re trying to do is open to questions and criticisms,” Gregory said, “and that can only make us better.  So we’ll remain optimistic. 
 
“We’ll keep everything open until we can’t any more, and for the people whose jobs were eliminated in this crisis, we hope to hire them back. 
 
“This is the second-most severe winter since I’ve been here. But I can say that of the 150 people who lost their jobs on Black Monday in 1990-91, most of them were back with the company after about 11 months. 
 
“We certainly look forward to having those people back. We’re optimistic about next winter.”

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