Circuit City has announced that it has laid off thousands of employees who the company says were paid well above the market-based salary range for their role.
The company says it will hire new employees for the positions and compensate them at the current market range for the job.
The layoffs affected about 3,400 store employees. The layoffs are part of a series of changes the company says it is making to improve financial performance.
The company also announced that it has entered into an agreement with IBM to outsource its information technology infrastructure operations. A total of approximately 130 Circuit City corporate employees will be effected by the change. Circuit City says approximately 50 of them will transition to jobs with IBM and remain on-site serving the Circuit City contract.