A Melville credit-card processing company that has been sold plans to lay off more than half its staff, according to a state regulatory notice.
Federated Payment Systems plans to lay off 47 of its 81 employees, according to a WARN notice the Labor Department posted on its website on Monday. The notice lists the company's purchase by credit-card processor EVO Payments Inc., which also has an office in Melville, as the reason for the downsizing.
An EVO executive confirmed the planned layoffs, which the filing says will take place "on or about" Jan. 8.
Some of the affected employees may be able to transfer to EVO 's Melville office, chief financial officer Kevin Hodges said in an interview Tuesday. He declined to say how many. That office is EVO's North America headquarters. Its global headquarters is located in Atlanta.
The planned layoffs involve employees who worked in back-office jobs such as customer service, accounting and marketing, Hodges said. "The nonsales positions are being eliminated," he said.
The EVO location primarily has information technology and accounting positions, he said.
EVO provides cash advances, among other services, to businesses that its website says range in size from small to multinational companies in North America and Europe. The founder of 29-year-old EVO, Ray Sidhom, funded a management team to start Federated in 1999, Hodges said. And EVO had held a 33 percent stake in Federated.
In September EVO acquired the rest of Federated, according to a news release issued at the time. The transaction is expected to generate about $13 million to $15 million in additional revenues for EVO in 2019, the release said.
“The acquisition aligns well with EVO’s direct U.S. merchant sales strategy and provides an opportunity to accelerate growth in this line of business," the EVO announcement said.
The acquisition came about four months after EVO went public in May and began trading on the Nasdaq. The company's shares rose 5 percent Tuesday to close at $24.25.
Under New York’s Worker Adjustment and Retraining Notification Act, companies with at least 50 full-time employees must file a 90-day notice of a mass layoff or closing.