No one ever stated that BC employees transistioned to Expo Holdings were earning an average of $60K a year. There are a lot of costs associated with keeping an employee on the payroll and EXPH was quite clear in stating these ARE employees...not independent contractors.
To begin with, EXPH has employee costs that are not voluntary. The employer must contribute 7.6% of total wages (there is a current limit on SS of $106.8K after which the 6.4% is no longer payable by employee or employers, there is no wage limit on the 1.45% due from employer on MC). There are contributions for unemployment insurance that must be made to both federal (FUTA) and state unemployment pools. There are workplace provisions that must be made for each individual employee, safety gear provided and other federal and state requirements concerning employee safety and well being dictated by OSHA. Then there are the voluntary costs. Insurance of which health insurance, even in the case of a co-pay can be enormous. Vacation pay, 401K and other benefits in the case of the executive or sales portion of the workforce. These costs and others all come before wages/salaries are even considered. My estimate would be that EXPH has a CONSERVATIVE 25-28% cost associated with each employee whether a laborer or executive. Making my estimates of their actual wages an average of around $850 a week or around $44K a year. Assuming half of the transition team was executive/management and half laborers, that works out well within standard wages for the industry. $15-17 an hour for a skilled woodworker is not out of line in NC or anywhere else in the country. That is only a tad over double minimum wage for a skilled position after all. Nor is $55-$60K a year for executive management. I can make a pretty good case from prior financials that Brown and Harrs were earning $125K gross a year. If that sets any kind of precedent, I don't think my figures are at all out of line for EXPH.
Of course it misses the BIG PICTURE that EXPH has transitioned these people over for CIMA. A division that will need to earn net revenues of more than EXPH's VERY HIGHEST goal set for it to pay for the cost of these nineteen alone. That means they will be LOSING money into the forseeable future even if my conservative estimates are off by 33.3% on the HIGH side.
All IMHO.
SBB
