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Morals and Layoffs
Radical changes in modern institutional structure have ushered in an era of short-term, contract, or episodic labor, writes economist Richard Sennett in his book The Corrosion of Character. Corporations have sought to remove layers of bureaucracy, to become "flatter and more flexible" organizations. In place of pyramid-style organizations, management wants now to think of organizations as networks. This means many more layoffs, writes Sennett, and also that promotions and dismissals tend not to be based any longer on fixed rules, since tasks are fluid, and the network is constantly redefining its structure.
Executives are paid more and more to re-shape companies, and work becomes less stable in direct proportion. Workers have never been more powerless, their tenure more fragile. Tech workers, many of whom came of age in an era of growth and full employment, are learning the lessons of the real world quickly. Tasks and missions are temporal, the people employed to execute them highly disposable. Work and workers are both flexible and expendable.
One of the most shocking and widely accepted tenets of the new techno-workplace is that the well-run company, the one that wants to compete in the global economy, has to be so fluid, evolving and responsive to change that thousands of employees can get dumped at one whack and it's not even controversial. That's a pretty long trek from the capitalist ethic that only a few years ago valued corporate loyalty as much as profits, and touted the company-employee bond.
And it raises all sorts of new questions -- especially for a generation of tech workers experiencing layoffs for the first time.
In the Corporate Republic, where corporations fund the political system, control most mass media, write legislation, and now dominate entertainment and culture (and soon, much of technology, from bio-tech to Net access), there are few agreed-upon rules about layoffs. Hardly any would get far in Washington, the world headquarters of corporate lobbying. (Congress, allegedly the public's lobbyists, are scrambling to get campaign funds from corporate donors.)
Unions, already on the wane, have never gained much hold in the Tech Nation, populated by educated, mobile, skilled and independent-minded workers. Some tech companies are comparatively generous -- extending health plans beyond the federal requirements with some benefits extending past a layoff date.
Cisco has offered to pay its laid-off workers for an additional year if they work for charities the company supports. It's nice, but it isn't the same as job security. And even that kind of moral responsibility is rare.
Under COBRA (The Consolidated Omnibus Budget Reconciliation Act) passed by Congress in l985, some laid-off or terminated workers (those fired for reasons other than gross misconduct) are entitled to continuation of health benefits for extended periods of time. COBRA doesn't cover companies with fewer than 20 employees, and it doesn't cover all workers terminated under all circumstances. If the company goes bankrupt, for example, COBRA doesn't apply at all. You have to check and see if you're eligible.)
Corporations have no particular incentive to be generous, or even ethical, to terminated employees. Most answer to boards of directors and demanding shareholders expecting maximum profits. Generosity towards workers doesn't serve the bottom line, even when it might serve the company's long-term interests. One of the reasons Cisco treats laid-off workers well, company officials have conceded, is to keep morale high among remaining employees, who feel better about the company and the work they do for it.
All sorts of class issues are roiling the new, techno-driven workforce, amid the thousands of layoffs being announced weekly.
The layoff was once the more or less exclusive province of the working class. but in recent years -- and especially recent months -- it has become a fixture of the white-collar and managerial universe, and of skilled, educated, tech workers. U.S. employment figures show the number of workers on nonfarm payrolls plummeting.
Now lawyers and journalists are getting laid off as well as tech workers, and when reporters started hitting the sidewalk, layoffs became a big story in a hurry.
Yahoo, Dell, AOL Time-Warner and scores of other companies have collectively let go of hundreds of thousands of employees (soon, probably to be followed by layoffs at the new company formed by Hewlitt-Packard's acquisition of Compaq). A generation of tech workers, for the first time, is feeling the impact of a workplace in which corporations seem to feel virtually no moral obligation to the employees they let go.
So just what moral obligation does a company have to laid-off workers?
Some possibilities:
- Maximum warning. Employees ought to have between three and six months' notice before they're laid off, time enough to look for other work in a sane, secure way.
- Continued health benefits. Employment used to be a contract: you worked hard for the company, the company took reasonable care of you. Employees who have been with a corporation any length of time at all -- I'd say six months -- ought to keep their health benefits until they find new work, a guarantee not even COBRA provides.
- Innovative responses. The layoff has become almost a corporate reflex, a statement to analysts, boards of directors and stockholders that management is lean and mean. When the market drops, capital gets squeezed,or takeovers occur, employment gets slashed. This often seems short-sighted. Tech workers are skilled and valuable. It's difficult to predict the nature of technology, and of consumer attitudes towards technological products and innovation. People laid off today might be urgently needed in six months. Shouldn't they at least have a chance to come up with other tasks, products, functions or ideas before they're booted out?
For that matter, tech workers could seek out companies with humane policies towards their workforce, making the companies more valuable and competitive. They could also begin demanding contracts and codified job security when the seek and accept positions -- especially when the economy is in their favor.
Regulatory agencies consider the impact of corporate decision-making on the environment, the consumer, and on anti-trust issues. Why aren't consideration of layoffs and job losses a factor in mergers like that between AOL and Time-Warner, or Hewlitt-Packard and Compaq? Maybe the loss of thousands of jobs isn't worth the short-term savings of some mergers.
Let's not kid ourselves. In the Corporate Republic, we can't expect companies, governments, unions or regulatory agencies to strengthen a sense of corporate morality or humanity. Corporations are more powerful than any of these entities, as tech workers are discovering by the thousands. Workers are on their own. Companies will demonstrate loyalty when they re-gain a sense that it's more efficient, ultimately more profitable, to keep experienced loyal workers than to employ insecure short-term ones. That's possible. But it isn't likely.
Right now it's turning into a "you'll start carrying an ID or you'll cry and carry an ID" republic.
After allowing employees to take a voluntary pay cut to save their company and thereby their jobs, Hewlett Packard has found the $130 million in savings was not enough to make investors happy. So, some of the very same employees who gave up salary "for the benefit of the company" are seeing their loyalty paid off in pink slips.
But wait. In what they are heralding as "the next era in employee outplacement," HP is giving it employees a choice of how exactly they will be shitcanned. Apparently, the recent repositioning campaign about sending HP back to the garage where its founder, well, founded the company was no metaphor. By the time the company is done trimming, the remaining staff will be able to comfortably fit in an average two car garage.
Industry analysts say that if HP keeps firing people at this rate, they should be in the black by year's end, even if they sell nothing at all.
More than 6,000 HP Employees found this check-a-box note in their mail trays on Thursday morning.
[Note: "Have my manager fired or laid-off instead of me" was not part of the option menu. Neither was "Screw the investors, we're not in the f***ing commodity business."]
HP CEO Carly Fiorina says that she is excited about the company's brave new direction in outplacement.
"At HP, we've always been innovators in terms of employee benefits and employee options," said Fiorina. "We think other companies in our peer group will be following our lead."
Chief among the innovations in the program is the new "volunteer status" which allows employees to continue working for HP and serving HP customers without actually getting paid. While the money they would have made is not tax deductible, they are, as Fiorina put it, perfectly free to brag about it as they would for any volunteer work. The company has outlined preliminary plans for Habitat-For-Humanity-style t-shirts for the new volunteers.
"You would be shocked to learn what people will do for a t-shirt," said Fiorina.
That Wired Magazine owes you something?
If you are looking for work in the private sector (corporations) a Ph.D. is a complete waste. Salary studies consistently show that people in tech jobs with a tech bachelor's and an MBA earn roughly twice as much as PhD's. People with Tech Masters come in a close second.
People with PhDs in Tech jobs average somewhere between high school graduates and college dropouts in salary. Yes there are excpetions, but as a rule a Masters degree is the top of the line.
Remeber the old sayings about PhD? Piled Higher and Deeper; and Someone who knows more and more about less and less.
Chris
-- I need more coffee. It's Monday. There is no such thing as enough coffee on a Monday.