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Originally published Friday, October 20, 2006 at 12:00 AM

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Saflink plans mass layoffs; remaining employees to shift focus

In a major restructuring, Kirkland-based identity-security company Saflink said Thursday that it will cut its workforce by more than half...

Seattle Times technology reporter

In a major restructuring, Kirkland-based identity-security company Saflink said Thursday that it will cut its workforce by more than half and focus the rest of its employees on a single project.

Saflink will have 30 employees after the reduction, down from 76. Employees are aware of the restructuring but won't find out about individual layoffs until today, the company said.

In addition to the Kirkland office, Saflink has employees in California, Virginia, South Carolina and Alberta, Canada. The company would not say how many Kirkland workers would be affected.

The government has been slower than expected in rolling out several security-related programs that Saflink has been working on, said Jeff Dick, vice president of finance. The company needed to cut costs as a result.

"It just hasn't come to market as soon as we had hoped," Dick said. "The company was in a place where we needed to reduce our operating cash burn."

Saflink plans to have its remaining employees focus on a nascent project to create special lanes at airport security checkpoints for people who have been pre-screened by the government. These fast-pass lanes would likely require that participants undergo a background check and register their fingerprints.

Saflink has submitted a proposal to run a fast-pass project at Denver International Airport. It's talking to other airports and airlines about similar initiatives. The company has not yet been certified by the federal Transportation Security Administration.

Saflink also said Thursday that it is in violation of a Nasdaq rule requiring three independent board members on its audit committee. It broke that rule in September when it named the committee chairman, Steve Oyer, to the role of interim chief executive. The company plans to appoint an independent director to resolve the situation.

Another director, Kris Shah, is leaving the company today. There are no plans to replace him, Dick said.

Saflink's chief financial officer, Jon Engman, is resigning from the company and will be replaced by Dick next month.

Saflink's stock price rose by 5 cents to 25 cents in after-hours trading Thursday in response to the news, which was announced after the markets had closed.

Kim Peterson: 206-464-2360 or kpeterson@seattletimes.com

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