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AT&T managers opt to retire

At least 14,000 managers will leave under a voluntary retirement plan that boosts pensions by 20 percent and expands benefits.

AT&T today said at least 14,000 managers will leave the company under a voluntary management retirement plan recently announced in January that boosted pensions by 20 percent and expanded benefit eligibility.

AT&T chairman C. Michael Armstrong said the number of volunteers was higher than expected, calling it good news because the company will now be a year ahead of schedule in its plan to reduce the size of AT&T's total workforce by as many as 18,000 people over two years.

The force reduction effort is part of the company's plan to reduce selling, general, and administrative expenses from 29 to 22 percent of revenue by the end of 1999. This year, the company hopes to reduce those expenses by $1.6 billion.

Originally, AT&T estimated that 10,000 to 11,000 managers might take advantage of the voluntary plan, which experts have characterized as both attractive and generous. The reduction effort also called for phasing out 5,000 to 7,000 other nonmanagement and management positions over two years, mainly through attrition and selective hiring, the company said.

The company said most managers who leave under the program will retire this year. Departures will be staggered to ensure a smooth transition of work, and the firm will continue to manage employment levels through a process of managed attrition and selective hiring.