IBM Offers Retirement With Job Guarantee Through 2013

dcblogs writes "IBM is offering employees who are nearing retirement — and may be worried about a layoff — a one-time voluntary program that would ensure their employment through Dec. 31, 2013. The program, described in a letter addressed to IBM managers, 'offers participants 70% of their pay for working 60% of their schedule.' Participating employees would receive 'the same benefits they do today, most at a full-time level, including health benefits and 401(k) Plus Plan automatic company contributions.' In 2006, IBM employed about 127,000 in U.S. The Alliance@IBM, a CWA local, now estimates the U.S. workforce at around 95,000. How far IBM will go in cutting is up for debate, including one radical estimate."

Comments

They're acting like they're in trouble!

[ZorinLynx]

Why the heck does IBM need to cut so many jobs? They're actually doing rather well by all business standards.

Yet here they're acting like they're hemorrhaging money and need to cut costs fast.

American Airlines did this sort of thing too, along with voluntary furloughs... But they're actually in trouble and have a reason to.

WTF?!

Re:They're acting like they're in trouble!

[SJHillman]

Cutting jobs that aren't needed is one way to continue doing well by business standards. The longer people on the payroll, the more they cost - if you don't generate more for the company than you cost, why should they keep you on staff?

Re:They're acting like they're in trouble!

[gl4ss]

they can't think of anything useful for them to do.

putting all engineer eggs in one corporation basket like that has a tendency to end up like that... it seems the lead layer doesn't just scale up like that, don't want duplicates of things going on in-house I suppose being part of the problem, so even if you have them on the payroll it's hard to justify using them for some project x which doesn't have a viable route to a viable product or it's too much like product y.

it's old geezers anyways, people who are nearly able to retire anyways. this way they would know exactly how their retirement would go and when they would move to it.

Re:They're acting like they're in trouble!

[Anonymous Coward]

Because IBM wants to get rid of American employees and replace them with Chinese and Indian employees at a fraction of the cost. I suspect they want to hold a general layoff, but the age demographics that they want to eliminate in the US (ie, mostly older employees) is prohibited by age-discrimination laws. So instead, they do this first, get rid of a number of older employees, then do the layoff in a legal way.

Re:They're acting like they're in trouble!

[AdrianKemp]

This is something that I feel has been lost in recent years, and I blame the political correctness garbage.

I work with people every day that have no job to do. I'm not talking about the typical "I'm the backbone of the company and without me they'd sink" attitude that so many people have. I mean they literally sit and play solitaire all day. They aren't doing bad work, because they don't have any to do.

Yet, they aren't fired, because you need fourteen thousand strikes and a paper trail eight miles long to do it.

I salute IBM in cutting jobs, the global computer market has changed, and IBM is no longer at the forefront of the entire market (nor can they be, it's so much bigger than it used to be).

Re:They're acting like they're in trouble!

[P-niiice]

Too many english speakers on the payroll, most likely.

Re:They're acting like they're in trouble!

[cpu6502]

Who wants to retire? You sit in your house. Alone. Nothing to do. Better to just keep going into the office, and sharing your knowledge/skills.

Re:They're acting like they're in trouble!

[vlm]

putting all engineer eggs in one corporation basket

it's old geezers anyways, people who are nearly able to retire anyways. this way they would know exactly how their retirement would go and when they would move to it.

Those quotes don't go together.

Prevailing wisdom is IBM is a tech company, this plan applies to people who are retiring next year so they're about 64, right? However the prevailing belief is pro football quarterbacks, heck, pro football linemen have longer professional careers than techies, so you'll never be hired after age 40 ever again. This would seem to imply the only people getting this offer are in finance, accounting, HR, receptionists, blah blah. Cant apply to anyone in tech because everyone in tech gets the solyent green career path around age 40.

That being said, the onsite IBM mainframe CE at a finance corp job 20 years ago was so freaking old he could have been there since the unit record equipment days (1930s), so its hard to say how it is now. Another datapoint is they were firing experienced people around that era and replacing them with recent college grads like a buddy of mine. In summary its unclear whats going on "inside" WRT to techs, unless we get someone "inside" to comment here.

Re:They're acting like they're in trouble!

[S77IM]

They've painted themselves into a corner. They experienced rapid "growth" by decreasing the bottom line. Now investors expect that, and so in order to keep up, they must continue aggressively decreasing the bottom line. If they stop, their stock price will drop as growth slows dramatically. It sucks for all involved, because eventually they'll run out of bottom line to cut, and then everybody's screwed except the investors (and executives) who sell just before that happens.

This is exactly the sort of thing Steve Jobs was talking about in the quote about bean-counters taking over the company and loss of product focus. Making enterprise software on an IBM scale, and doing it well enough to grow constantly, is really super hard. Short-term gains through off-shoring are easy.

  -- 77IM

Re:They're acting like they're in trouble!

[dkleinsc]

The longer people on the payroll

That's an odd way of making the decision - there are very few businesses where how long somebody is has anything to do with their job performance.

Re:They're acting like they're in trouble!

[gstoddart]

Cutting jobs that aren't needed is one way to continue doing well by business standards.

Provided, of course, that these are actually jobs that aren't needed. Corporations sometimes suck at that part.

Several years ago, the entire project team I was on was notified we were being let go. As we got closer to our final days, Sales had their knickers in a twist because they had a huge business deal on the line for the product we built.

Trying to explain to a panicked salesman that fixing that bug or adding that feature wasn't going to happen because your last day is the end of the week is always fun. It boiled down to "wow, how unfortunate for you to be trying to close a multi-million dollar sale when the company has decided they don't need any of the people involved". Of course, the salesman was frantic about the sale and his commission -- couldn't quite understand why that was no longer our problem.

I've seen several instances where the bean counters decided to get rid of certain people without actually knowing what their role was.

Re:They're acting like they're in trouble!

[Jah-Wren Ryel]

The longer people on the payroll, the more they cost - if you don't generate more for the company than you cost, why should they keep you on staff?

That attitude is fine - as long as management is never tries to exploit employee loyalty to work for less than market rates. Goose and gander as it were...

Re:They're acting like they're in trouble!

[Gr8Apes]

Why do share holders like dividend increases?

Why do executive like larger, rather than smaller, bonuses?

So let's start by getting rid of some executives....more bonuses for those that are left, and happier stock holders because the outstanding shares just went down and there's a reduction in losses.

Re:They're acting like they're in trouble!

[Anonymous Coward]

IBM is doing well by short sighted measurements. IBM is not doing well for the long term. Quality is no longer provided. Especially with the India based delivery teams. Nothing and I mean nothing is completed on time anymore. Even two or three years ago the delays on my current customer in implementing the security policy would have heads rolling. Instead delays keep getting reported to the customer. Now with double checks to see if the security policy is implemented we are turning up tons of issues where no work was done.

IBM is well on its way to corporate doom. The great reputation IBM held for many years is the only reason the company is holding on now. The shorted sighted leadership that started with Sam Palmisano and continues with Virginia Rometty should be used as case studies in business schools on how to destroy a company. IBM doesn't even have the excuse of the car manufactures dealing with unions.

Re:They're acting like they're in trouble!

[vlm]

Keep 5% extra on staff if you're expecting 5% growth next year and it takes weeks to years to get up to speed.

Dump people if you predict permanent long term economic decline.

Hmm, which future outcome are they apparently publicly predicting, and should I therefore buy or sell IBM stock?

Its not so much a current or historical thing as a future prediction.

Say it costs on average half a years pay in severance and half a year's pay in recruiting costs. You're betting that you won't need to hire people for expansion at least a year, or in IBM's case, frankly probably forever.

There are other hidden costs... only a madman or a desperate man would take a job at IBM knowing its only a matter of time until they randomly get the axe. In fact anyone with the ability to get a job elsewhere should hurry the F up and get out to any job, any where, especially IBMs competitors, because when IBM dies, their competitors will boom with all the new revenue. That has a HUGE medium to long term impact on productivity and corporate survival. IBM's only hope is to try and destroy their competition in the short term... watch for it.

Re:They're acting like they're in trouble!

[houghi]

I used to work at a company and they decided that each department needed a 50% cut in staff. This was calculated on actual staff, not on people actually being there.

One department should have 4 people. It was 2 people understaffed, so they fired one. Person got a nice handshake to leave. I believe several months (7 or 8) pay.

That person was re-hired after a month. I would not be surprised ig that person was hired with a higher pay then before.

Re:They're acting like they're in trouble!

[vlm]

Difference between education and training:

Educated guy has stuff to think about and do; hobbies; lasts a lifetime.

Trained guy has nothing to do but go to work, nothing to do at home but watch TV, maybe drink.

I've seen both types retire... uneducated retirement isn't pretty and they don't live long, educated guys have a freaking blast after retirement.

Re:They're acting like they're in trouble!

[MozeeToby]

Where do you work? Most every state in the US has at will employment; you can fire whoever you want whenever you want, as long as you aren't doing it in retaliation or to discriminate, and even then the burden is o the fired employee to prove. Maybe your company signs contracts with their employees, or explicitly states that you won't be fired without cause, or (more likely in general but given your 'playing solitaire' comment pretty unlikely) maybe they're unionized. But outside of those situations there's no reason your company couldn't fire 90% of their workforce tomorrow morning without warning.

Re:They're acting like they're in trouble!

[Anonymous Coward]

Who wants to retire? You sit in your house. Alone. Nothing to do. Better to just keep going into the office, and sharing your knowledge/skills.

Who wants to work? You sit in your cubicle. With your fellow cow orkers. You've got things to do - things so odious that others have to actually pay you to valuable money to do it. Better to just sit in your house, working on some project that you, personally, found so interesting you'd do it even though nobody's paying you, and share your knowledge/skills.

Re:They're acting like they're in trouble!

[thomasw_lrd]

Sounds like my job, only my bosses really can't get rid of me, cause I'm the only programmer, and the only one who can work on this colassal clusterfuck of a php/mysql webapp.

In fact, I'm so good at doing nothing, that I just got a bump in the bonus pool, and I get to work from home 3 days a week. Of course, I'm not being paid even half of software engineer median pay, but then again I live in the rural south, where everything costs a hell of a lot less than almost everywhere else, so it's a pretty good trade off.

Re:They're acting like they're in trouble!

[Local ID10T]

They've painted themselves into a corner. They experienced rapid "growth" by decreasing the bottom line. Now investors expect that, and so in order to keep up, they must continue aggressively decreasing the bottom line. If they stop, their stock price will drop as growth slows dramatically. It sucks for all involved, because eventually they'll run out of bottom line to cut, and then everybody's screwed except the investors (and executives) who sell just before that happens.
  -- 77IM

To borrow a phrase "I don't think that word means what you think it does".

While growth may indeed cause the bottom line to decrease (ie hiring more people, opening a new office, or buying new equipment (growing the business) costs money and reduces (decreases) the amount of cash you have left (the bottom line)), generally investors want to see an INCREASE in the bottom line -they want more money, not less. If you are "aggressively decreasing the bottom line" you are doing it all wrong.

Re:They're acting like they're in trouble!

[AdrianKemp]

I don't work in the US, I understand that your laws are better, however from what I know you're also a little ways from reality.

While it's true that the employee in the US has to prove discrimination to actually win any sort of suit, they by no means need to do so to cause serious problems for the company.

Re:They're acting like they're in trouble!

[vlm]

A prime example of theoretical vs practical.

The legal costs of defending someone filing a lawsuit, even a completely frivolous one, are so high compared to the cost of some salary that its cheaper to collect a folder of signed disciplinary actions and formal gathered evidence than to just toss them out on the street like a bouncer in an old western movie tossing a guy outta bar.

There are also numerous legal issues with your exaggerated example of firing 90% of your company... here we have "at will" theoretically, but the company has to pay a rather substantial fine to the state if they fire more than 50 people with less than 60 days warning. I really have no idea why. Technically its not "at will", in the same way that our financial system is not a "free market" but we pretend it more or less is.

Never forget than 50% of management is below median. You might think they would want to dispose of the deadweight, but they may be idiots.

Finally, or they may realize if they get rid of the peons they won't be able to justify their empire based on # of direct reports. One place I worked at, the manager really wanted to be a director, and he's not getting that promotion unless he has the minimum of X front line employees, so lots of solitaire was played. Out of business now, of course, but it was a rational strategy for that boss at that time. I'm sure he's a VP (if not higher) somewhere now.

Re:They're acting like they're in trouble!

[scot4875]

Better? That's awfully subjective.

--Jeremy

Re:They're acting like they're in trouble!

[tattood]

there are very few businesses where how long somebody is has anything to do with their job performance

He wasn't saying it was directly related to performance. If your company pays raises every year, then the longer you work there, the more and more they have to pay you. Unless you are getting more and more responsibilities to work on, then you are not doing any more work for the increased pay. Therefore, his argument that the longer you work there, the more it costs the company with no productivity benefit.

Re:They're acting like they're in trouble!

[alexander_686]

It’s not a question of age or productivity. The issue (I am willing to bet) deals with actuary science and low interest rates. IBM has a lot of people on their Pension Plan. They tried to push people to a hybrid plan, but lost a court case.

Pension obligations are based on expected future payments (as calculated by actuaries) and discounted by a interest rate – in this case long term government bonds.

So we have older workers whose future payments are more or less fixed. Government interest tank, so the obligations go through the roof, so the company has to contribute more, so the older work’s (effective) pay goes through the roof. Kind of the dark side of having a defined benefit plan which few people talk about.

Re:They're acting like they're in trouble!

[AdrianKemp]

Well inherently the word better is subjective, yes...

You seem to disagree though, what restrictions (aside from criminal discrimination) would you place on a business removing employees?

Re:They're acting like they're in trouble!

[mc6809e]

Where do you work? Most every state in the US has at will employment; you can fire whoever you want whenever you want, as long as you aren't doing it in retaliation or to discriminate, and even then the burden is o the fired employee to prove.

Mostly wrong. Your own link shows that 43 states have public policy exceptions that limit at-will employment, and 37 states have implied contract exceptions. There are also covenant of good faith and fair dealing exceptions.

Oh, then there is federal law.

There is no place in the USA with genuine at-will employment. If you fire someone, there's a chance you're going to get sued. Even if the case is without merit, a sympathetic jury can see you as a villain and nail your ass to the wall. Even you win the case, you can expect huge bills from your attorney.

Then there's the issue of being liable for the actions of your employees while they're on the job if they acted on their own and even in opposition to your directions.

Employing another person in the USA is legally hazardous. The law is definitely not on the side of the employer.

Re:They're acting like they're in trouble!

[vlm]

Ohh another real world example, happened to a friend and coworker of mine.

Multimillion dollar service contract (maybe low 9 figures total?) depends on department being ready to hit ground running to even submit a qualified bid, much less to win. Department also needs regulatory approval for the tariff (yes, this was telecom). Regulatory approval and contract negotiations took over 3 years after my buddy was hired. Much solitaire played for full salary. Wish I was there! They literally did Nothing business related for years. Department wide LAN parties, salaried guys only showed up for an hour or two per day, 3 hour lunches each day (described as like a roman feast, except no togas). Read books, do homework for night school classes... Some weird story about a guy painting plastic dnd miniatures or maybe it was warhammer miniatures for weeks at a time, donno. RC car races around the cubes... nap time after lunch. Watching downloaded movies on the projector in the meeting room. My buddy finished most of a CS degree in night school... helps if you have about 7.5 hours free time to study and do homework each "working" day. He didn't feel bad about it, he considered it like winning a scholarship.

Re:They're acting like they're in trouble!

[dkleinsc]

You missed the joke - SJHillman had accidentally left out a verb, so the word "long" described the person, not the tenure of his/her employment.

Re:They're acting like they're in trouble!

[Anonymous Coward]

Whoooo...

No, I'll even explain it.

The "longer" people on the payroll.

The people on the payroll, who are longer.

MEGA COCKS = FIRE THEM

It's penis envy.

Re:They're acting like they're in trouble!

[crazyjj]

Why the heck does IBM need to cut so many jobs? They're actually doing rather well by all business standards.

Because that's how companies up their short-term profits these days, of course. Any CEO knows that you don't boost profits by making stuff and selling it or any of that nonsense, you just cut costs by firing more workers and making the existing workers pick up the slack (hey, where are they going to go in this economy?). And it's all about the short-term profits. Up those numbers for next quarter and you get a bonus. Sure, it may hurt your company in the long-term, but you'll be long gone with your golden parachute by them. And that's what being a CEO is all about.

Re:They're acting like they're in trouble!

[Red Flayer]

This is exactly the sort of thing Steve Jobs was talking about in the quote about bean-counters taking over the company and loss of product focus.

Obviously you didn't read the thing Steve Jobs was talking about (or didn't retain the point he was making)... it wasn't bean-counters running the show that he found problematic, specifically it was salespeople running the show. More generally, it was non-product people running the show.

I know the zeitgeist on slashdot is to hate beancounters, but I think that's misplaced. Usually the beancounters take the bad rap among staff for decision by those made above them -- that's fine, we understand it's one of our roles (I'm speaking as a beancounter myself). But if you're going to analyze it from a higher perspective, you need to understand who is actually calling the shots -- it's rarely the beancounters (and I've yet to see any major company that isn't in bankruptcy (or near it) where finance runs the show -- it's almost always product or sales people).

Re:They're acting like they're in trouble!

[bryan1945]

Would have be great to be a fly on the wall when the executive in charge of that decision found out what happened. And then when his boss found out what happened.

Re:They're acting like they're in trouble!

[noh8rz3]

where do you work? business, govt, academia? union, non union?

Re:They're acting like they're in trouble!

[Yaotzin]

Tall people do, statistically, earn more money though.

Re:They're acting like they're in trouble!

[Kittenman]

This is something that I feel has been lost in recent years, and I blame the political correctness garbage.

I work with people every day that have no job to do. I'm not talking about the typical "I'm the backbone of the company and without me they'd sink" attitude that so many people have. I mean they literally sit and play solitaire all day. They aren't doing bad work, because they don't have any to do.

Companies have a choice - you can be overstaffed when there's no crisis and have people sitting (basically) idle - but hopefully doing self-education (hopefully not minesweeper, but...) or be understaffed when there is a crisis. Most companies prefer the former.

Re:They're acting like they're in trouble!

[sociocapitalist]

Cutting people that aren't as profitable is one way to continue doing well by business standards. The longer people on the payroll contributing their lives to make the owners rich, the more they cost - if you don't generate more profit for the company than people in third world countries who are willing to work for 1/10th to 1/300th of what it costs to keep you, why should the greedy bastards keep you on staff when they can cut you and improve their bottom line?

FTFY

Re:They're acting like they're in trouble!

[Xemu]

Never forget than 50% of management is below median. You might think they would want to dispose of the deadweight, but they may be idiots.

You're not thinking it through. 50% of management will always be below median, however the median may change. It only makes sense to fire-and-replace if you actually believe you will end up with a higher median. Consider you are likely to end up with a lower median if your company earns a reputation for suddenly sacking 50% of its workforce. There is also wisdom in the saying better the devil you know.

Re:They're acting like they're in trouble!

[hairyfeet]

The airlines did it so they could dump the retirement benefits they had agreed to onto the US taxpayer which of course saved them a shitload of money. it was a nice scam, get the employees to agree to all these cuts in return for benefits and then don't actually provide the benefits. As for IBM? They are just showing why the USA is a corpse, they are shedding as many USA jobs as they can because you can hire someone in India and China for a pittance compared to a US worker.

This is why I have been saying for years FREE TRADE IS A LIE because it is impossible to have free trade with a country that has practically zero worker or environmental regulations. it would be like putting your HS football team against the Denver Broncos and then paying the refs to look the other way on fouls. Even if your team played their ass off the other guy has so many advantages, in this case they can have unsafe work conditions, no overtime, dump toxic waste in the ditch, that there is simply no way to compete.

So while the MSM lies to us about "jobless recovery" which is newspeak for "The rich are doing VERY well, aren't you happy?" the reality is if you go to the flyover states and drive through their business districts they look like "Escape From New York" with endless empty factories and abandoned buildings. For the first time ever I have had several businesses that I work with file bankruptcy and close shop, not because they were wasting capital or running debts, but because they could see the writing on the wall and realized it was impossible to compete. A few sold their assets and then retired, a few other moved to mexico, but the one thing I heard over and over was "I just can't compete with those that don't have any regulations" and its a fact. Free trade is a lie, it benefits the 1% while destroying the country and its time we made isolationism and nationalism the policy. Do you think India and China would put up with this kind of crap? They would shut down their borders first.

Re:They're acting like they're in trouble!

[swb]

They can show you the door anytime but in most places they have to do it "for cause" in order to avoid paying you unemployment, which is actually fairly costly for an employer who is eliminating a *person* and not a position, as they will have to hire a new person for the position and train them, too, in addition to paying unemployment. The net effect is basically paying two salaries.

It's the "for cause" thing that makes it hard, you have to show that they were ignoring legitimate direction, had attendance problems or violated legal company policies and were given ample opportunity to correct their behavior.

Without cause, they can easily collect unemployment as well as hire an attorney and fish for more money based on their protected class status (ie, black, woman, older, etc) even if they have little grounds on which to pursue action. There's a lot of experienced attorneys who know how to turn a termination without cause into a quick $10k settlement. That's an easy nickel for the client, plus unemployment. I call that getting fired plus a week in Florida.

Re:They're acting like they're in trouble!

[Luckyo]

Loyalty and experience of working in that particular company.

If you ever got out of your hypothetical slogan ivory tower and actually worked with new company recruits in any field that requires high levels of education and by extension a lot of specialist workplace training, you'd know that first few months is essentially figuring out if the person matches your needs. Then you spend a year or so apprenticing the person to someone experienced and letting him learn the ropes of how company works.
Then you have to give the guy a huge raise and start moving him on his career or your competitors will poach him because they get a trained employee with good knowledge of their competition's modus operandi.

And finally, if it's a position where person gets to manage company money, you stand to lose several orders of magnitude if you put someone unsuitable to that position. I know of several people who essentially "play solitaire" for months on until next project that they need to manage comes. Why are they kept on their huge salaries? Because they have earned company trust and company knows that they can put projects that require very strict kind of work and management into their capable hands.

Looking for a free agent for such work will cost your company at least an order of magnitude more then this person's big salary because of all the bonuses you'll have to pay to jury-rig the "trust" necessary, and it'll still not be as reliable.

Re:They're acting like they're in trouble!

[Mr. Shotgun]

there are very few businesses where how long somebody is has anything to do with their job performance.

Porn: Blazing trails in business for millenia!

Re:They're acting like they're in trouble!

[SJHillman]

It seems that the more time I on Slashdot, the more I to leave out verbs.

Re:They're acting like they're in trouble!

[vlm]

Hmm my point was not just fire the bottom half, but to realize that what a smart /.er would consider blindingly obvious might be far beyond the ability of perhaps the bottom half of managers, especially the lower level ones.

Sometimes it sucks to work for a guy who got his job solely based on his golf game, or who his daddy is... that's your fault for not gaming it into a new scenario where it rocks to work for someone who got his job solely based on his golf game, or who his daddy is... In the long run that behavior will destroy the company, but no one cares about the long run anymore, so...

Re:They're acting like they're in trouble!

[Wansu]

  I salute IBM in cutting jobs ...

I salute them too, but in a different way.

This is IBM's new business model. They make the books look good by laying people off. Go for it! At the rate IBM is shrinking, they'll be gone soon enough and the world will be shed of them.

Re:They're acting like they're in trouble!

[couchslug]

"educated guys have a freaking blast after retirement."

Fuck yes.

BTW, joining the military is a screaming deal. I'm retired after 26 years, debt-free, and with low overhead. "But people who join the military often have lower lifetime incomes that civilians!" No shit. If I don't feel like working, I don't have to. Beats "dying in harness" like an old plow mule any day.

Re:They're acting like they're in trouble!

[drsmithy]

You seem to disagree though, what restrictions (aside from criminal discrimination) would you place on a business removing employees?

A legitimate reason.

"Your job no longer exists" is a legitimate reason. So is "you're incompetent".

"We're going to fire you today so we can hire you back tomorrow to do the same work on half the pay" or "we're going to fire you so we can hire the new CEO's son into the same position" are not.

Re:They're acting like they're in trouble!

[realityimpaired]

this is also why they won't try for government contracts because of quotas and the fear they will be stuck dealing with workers they are afraid to let go for fear of spending a year or more dealing with a lawsuit lotto.

You don't have malicious litigation rules that would require the plaintiff to pay legal fees for the defendant if his complaint is found to be without cause?

We have those kinds of rules here in Canada, and it does a pretty good job of stopping people from suing unless they have a legitimate beef.

Re:They're acting like they're in trouble!

[bws111]

The problem IBM has is not too much staff, it is that the staff is shall we say 'mature'. They had a huge hiring boom in the late 70's through middle 80's. In the 90's it was apparent that they had too much staff, so they cut a whole lot. However, they only cut people who were no longer needed, they did not cut older people and replace them with younger ones (which would open up a whole different set of problems).

In spite of some things you read from bitter people, working at IBM is a pretty good job. Once people have been there a few years they tend to stick around forever. This leads to very low turnover.

So, the problem they are now facing is that much of their US workforce is nearing retirement, but nobody really knows when or if people are going to retire. Those people have wealth of knowledge about the company, it's products, it's customers, it's way of doing business, etc. They can not afford to lose all that knowledge.

This causes too much uncertainty in the company. If they hire new staff, and the older people do not retire, they have too much staff. If they don't hire new staff and people do retire, they lose all of the knowledge those people have.

So, they approach this in different ways. One way is to hire in countries other than the US, and when those hires come up to speed they transfer the workload to the other country. Now less people are needed in the US, and they have a layoff. Because the workload has moved, it is harder for someone to claim age discrimination as the reason they were let go. The new approach seems to be to encourage people to consider retirement, and transition to it with a plan such as this one. While the to-be retiree is working part-time they can hire someone to replace him, and he can use the time he is working to train the new hire. Where those new hires will be is of course another question.

Re:They're acting like they're in trouble!

[hairyfeet]

Nope it is EXTREMELY rare for the losing party to have to pay shit, and since you have tons of ambulance chasers willing to work on a contingency basis, aka "We get a cut only if you win" that is why many here call it "lawsuit lotto" because like the lotto it costs the person VERY little to play and can net them millions. Of course the ones that DO pay are minorities who won't get hired for fear of lawsuit lotto, stores who bump the hell out of security for fear of the fake slip and fallers looking for lawsuit lotto, pretty much everyone BUT the one actually starting the spin at the lawsuit lotto wheel pays.

NOW do you see why i say we're fucked in the USA? if I was starting a new business it would be in China, too much BS and risk here.

Re:They're acting like they're in trouble!

[swalve]

When you are too lazy to do the hard work of maintaining a paper trail, you are going to get bad employees. And then when you fire them, they will sue you. It feeds on itself. If you just do a three strikes thing, when the employee knows their job is on the line they are going to be much less likely to sue when they finally screw up. As a bonus, your employees have good feedback on their job performance.

Re:They're acting like they're in trouble!

[swalve]

I agree. Defined benefit programs ought to be illegal. I mean, it's nice for the employees who manage to collect, but it ends us screwing up businesses and future employees. I'm not sure if the statistic is correct, but it has to be close to the truth: more of the price of a GM car goes to pay retiree benefits than it does to pay the people who actually built the thing.

Re:They're acting like they're in trouble!

[DDLKermit007]

I used to work for MGM Resorts in Las Vegas. Nevada has it bad for "at will" work state, but corps like MGM just get so big it's easier to file people away to the point the useless people make up 70% of staff if not more. Getting them to fire someone is hellaciously difficult. Corps like that are deliriously faerful of things like unemployment.

Re:They're acting like they're in trouble!

[WOOFYGOOFY]

I work with people every day that have no job to do. I'm not talking about the typical "I'm the backbone of the company and without me they'd sink" attitude that so many people have. I mean they literally sit and play solitaire all day. They aren't doing bad work, because they don't have any to do.

I have no idea where you work. I too work with people who literally play solitaire all day and once in a while get up to see how it's going. They're managers and I''ve learned to shuffle my feet on the way to their cube b/c they really hate being caught out with that little card game on their screen...

But I have a different experience than you. The way it works at my company, you're golden if you have allies at the top and otherwise you're expendable. They've fired the BEST developers we had b/c those developers looked crosseyed to Mr Well Connected and believe me when I say the firing was just a matter of crossing the Ts and dotting the Is - a mere formality, based on a falsifiexd evaluation of not even their work product but their "communication ability" or some such shit.

So that's my data point. If you want a view with more gravitas and a wider range of experience from someone in HR who did the firing , then I heartily recommend the now classic book Corporate Confidential http://www.amazon.com/Corporate-Confidential-Secrets-Company-Know/dp/0312337361 where the author buttresses everything I just said.

Firing is no problem in the US even if you're a minority and even if you're over 40. They're not the least bit intimidated by the law, nor are they going to allow themselves to become dependent on a performer so don't even think of trying to obtain job security through excelling - they just see that as you trying to top them from the bottom, and it pisses them off.

. Learn how to be liked by people who no one would describe as other than cretinous, or be fired. Really.

Re:They're acting like they're in trouble!

[bloodhawk]

"We're going to fire you today so we can hire you back tomorrow to do the same work on half the pay" or "we're going to fire you so we can hire the new CEO's son into the same position" are not.

those are certainly arsehat reasons to fire someone, but I would argue that really that is their right it is their money and their business, if they want to run it into the ground it is their right, just as it would be the employees right not to work there for half the pay.

Re:They're acting like they're in trouble!

[bloodhawk]

They aren't dumping people because they predict a downturn, they are dumping people in costly western countries and hiring in cheaper countries. It is more of a cost restructure to do the same (or more work) but with significantly cheaper resources thereby giving them there targetted increase in profitability. Not saying it is good or that it will work, but purely on the accounting side it is a pretty basic cost reduction concept.

Re:They're acting like they're in trouble!

[Anonymous Coward]

Soon there will be no more of us American IBMers left to clean up the crap that comes from India.

Re:They're acting like they're in trouble!

[timeOday]

Kind of the dark side of having a defined benefit plan which few people talk about.

That's the entire point of a defined benefit plan. That's what "defined" means. It means the company is taking on the risk of unpredictable future returns, giving the employee a predictable standard of living in retirement.

But it turns out this was theoretical for those of us beneath a certain age. 10 years ago I was told there was so much money in my company's pension fund they didn't know what to do with it. So they gave existing retirees a raise in their pensions. Then once the market tanked, the pension fund went broke so they cancelled it for new hires and curtailed future accruals for current employees, shifting us to 401k's. What might those be worth when we need them? It is unknowable. Meanwhile existing retirees are sitting pretty in expensive neighborhoods drawing their bloated benefits. Oh yeah, they got pre-medicare health coverage too. Now cancelled.

I really think Social Security is a good idea, since there is no predictability at the level of individuals. However, Social Security needs to be tied to the long-term median income (say, 10 years) of current workers instead of inflation. Today's retirees seem to be oblivious to what is going on to current workers and our poor prospects for financial security in old age.

Re:They're acting like they're in trouble!

[Nursie]

"those are certainly arsehat reasons to fire someone, but I would argue that really that is their right it is their money and their business, if they want to run it into the ground it is their right, just as it would be the employees right not to work there for half the pay."

And that's where you disagree with modern (and I would say enlightened) labour laws in places other than the US. This sort of thing is the reason I (and many others) would never consider going there to work. People are kept in a state of fear for their employment, work stupidly long hours, take little to no vacation, frankly it's hell.

Somehow, places like Australia and the UK that have more reasonable employee protections haven't completely fallen apart yet.

Re:They're acting like they're in trouble!

[alexander_686]

But that is expensive. A company could go out and buy the exact same benefits for their employees via a life insurance company – but at much higher cost.

Life Insurance companies (effectively) have to discount their liabilities at government bond rates – which are guaranteed. I mean, if you are going to guaranty a rate, and returns are linked to risk, that implies a low risk, and thus a low return.

I think you are a bit off on Social Security. Currently benefits are tied to Average Wage Index, not inflation. (And yes, Congress will sometimes step in a goose the figures up a bit when inflation goes up faster then the Average Wage Index, but that is the exception, not the rule.)

But back to pensions – and those are expensive. A company could go out and buy the exact same benefits for their employees via a life insurance company – but at much higher cost.

Life Insurance companies (effectively) have to discount their liabilities at government bond rates – which are guaranteed. I mean, if you are going to guaranty a rate, and returns are linked to risk, that implies a low risk, and thus a low return.

Private companies can use a much higher rate, usually a blend of stock market rates and corporate bonds – and thus are much freer to take risk.

It’s not that I am against pensions – it’s just that I am against the bad actuarial assumptions that most company plans make.

I will point you to a contra example. When AIG blew up, and the government had to bail out corporate, you might have noticed that they did not have to bail out the fixed annuity arm. That’s because 1. the life insurance was segregated out with their own accounts, 2. the pension obligations were conservatively modeled – by state regulators who are not interested in bailing out life insurance companies.

Re:They're acting like they're in trouble!

[rtb61]

What part of 'offers participants 70% of their pay for working 60% of their schedule.' do you not understand. Just because you are a ruthless unthinking schmuck does not mean IBM is.

It's called job sharing. People who aren't as greedy and have enough sharing employment opportunities with others.

Basically IBM is being very smart 21st century smart, by establishing the principle of job sharing they can in fact increase the size of the labour force without substantially increasing cost. In terms of sales this puts many more boots on the ground, many more people interested in promoting the future of IBM.

So smart thinking not screw everyone else greed thinking.

Re:They're acting like they're in trouble!

[Compaqt]

Wouldn't it just be easier to offer $10k (or $7.5k) upfront along with an agreement that says "This is a final settlement"?

Re:They're acting like they're in trouble!

[Nursie]

Enlightened countries realise workers need rights too, and the right to remain employed so long as they fulfil their end of the deal and the company can afford it, that's a good right.

I agree there should be no barrier to getting rid of useless people, or making people redundant in a downturn in the business's fortunes, but that's as far as it goes. Kicking someone out 'just because' is unreasonable. Sorry if you feel it's your money, but it's also their life.

Re:They're acting like they're in trouble!

[Nursie]

Not taking on people because they can't afford it?

It's probably good that that happens. Hell, it's a positive that they're not taking someone on (who may then organise their life around the job) if they think they'll have to ditch them again at short notice.

Re:They're acting like they're in trouble!

[PybusJ]

There is no place in the USA with genuine at-will employment. If you fire someone, there's a chance you're going to get sued.

But then, there's very little that you can do at all (which might piss off someone else) which doesn't carry some risk of being sued, even if the suit is without merit.

Re:They're acting like they're in trouble!

[realityimpaired]

It doesn't matter that your lawyer is working on contingency. If you sue me because my shoes caused your mother's cancer, then my lawyer isn't working on contingency. Even if you don't end up having to pay your legal fees because you didn't win, my lawyer, in a Canadian court, will file a brief requesting that you pay my legal fees under malicious litigation rules, and you'll be on the hook for paying my lawyer for the work she did defending against you.

Re:They're acting like they're in trouble!

[tehcyder]

Yet, they aren't fired, because you need fourteen thousand strikes and a paper trail eight miles long to do it.

Yes it's political correctness/socialism gone mad, isn't it?

What with unions abl to negotiate pay rises and conditions, the right to strike, health and safety legislation and anti-eight-year-olds-sweeping-chimneys laws, it's impossible for any brave entrepreneur to make more than a few paltry billions today.

Re:They're acting like they're in trouble!

[tehcyder]

What ignorant right wing twats like you always forget is that the employer-employee bargaining and contract making relationship is not based on an equal footing from the beginning, and is therefore morally void. If it wasn't for unions and progressive government legislation, you'd be on a dollar a day like the wage slaves in China.

Once you are an employer, you call the shots, or at least you would if the libertaritards had their way.

Re:They're acting like they're in trouble!

[tehcyder]

I hardly consider those enlightened labour laws. They are draconian governments dictating to people what they can and cannot do with things they own. Whether that is an individual or a company it is a slippery slope that is far worse than any of the labour wrongs it is trying to right. Just look at the fucked up labour laws in Australia, it sees companies and small businesses refusing to hire as they are too scared they will be stuck with them in a downturn.

If you genuinely think that employees are the property of employers, I almost feel sorry for your stupidity.

Re:They're acting like they're in trouble!

[tehcyder]

Never forget than 50% of management is below median..

Whereas of course 100% of software developers (or whatever it is you do) are above average.

Re:They're acting like they're in trouble!

[tehcyder]

If you fire someone, there's a chance you're going to get sued.

Well, yes. In the same way that if you end any contract there's a chance you're going to get sued.

The main difference is that employment contracts are drawn up by employers, and employees generally have two options: sign it or look for another job. In effect, all employment contracts are signed under duress, whatever the free market fantasies of some highly successful and well paid people.

Re:They're acting like they're in trouble!

[tehcyder]

Yes, it's not like large corporations have any access to lawyers or anything to sort their problems out. It's only unions and employees who can pay for legal advice, it's so unfair.

Re:They're acting like they're in trouble!

[tehcyder]

Yeah, your anecdote reminds me of stories about beggars in cities actually being millionaires. They live in luxury houses and just dress up as beggars from 9 to 5 and earn a fortune. It's true, the Daily Mail here in the UK says so.

Tosser.

Re:They're acting like they're in trouble!

[pnutjam]

Employers don't pay unemployment, it is not like paying two employees. You are misinformed or deliberately misleading.
Employers do pay an unemployment insurance rate which can increase if their frequently putting people on unemployment, but it is much less then any individuals salary.

Re:They're acting like they're in trouble!

[pnutjam]

I've been in these environment before. Sometimes it comes from the top down and sometimes there is a middle manager doing it and the top is clueless. Thank God I don't have to deal with that anymore.
At one of my previous positions there is not a single person that was in the IT dept that is still in IT 4 years later (except me).

Re:They're acting like they're in trouble!

[tehcyder]

I have talked to owners of companies that privately confided in me they are afraid to hire certain races, not because they harbor any kind of ill will or racism, but because the last time they did and fired a worker who wasn't pulling their weight they had to deal with lawsuit lotto.

Yes, I've heard this argument a lot from company owners too. The thing is, it's usually with a wink, as most people nowadays at least have the common sense to know you're not allowed to say you're racist.

Similar explanations include "I'm not racist but blacks/Asians/whoever are just lazy", "I'm not prejudiced but I just can't understand the way black/Asian/whoever people talk" and "I'm no bigot, but it's been scientifically proven that blacks/Asians/whoever are intellectually inferior".

Now wait for the slashdot fascists to accuse me of reverse racism or something.

Re:They're acting like they're in trouble!

[tehcyder]

Until your instructive anecdote, I had no idea that big corporations were such wonderful charities that they paid two thirds of their staff to do nothing.

You've certainly opened my eyes to the reality of capitalism, here was I thinking that when large companies slashed the workforce at every opportunity to increase profits! I must have been reading too much left wing propaganda.

Re:They're acting like they're in trouble!

[swb]

The gimmick often is luring employees into agreeing to an agreement that gives them N weeks of salary/benefits but makes them agree to all kinds of employer-friendly clauses like non-disparagement, binding arbitration, etc.

Many people are like "Shit, I'm losing my job and they are offering 6 weeks severance -- where do I sign?" Often times not even realizing that they may be "voluntarily" resigning and thus forfeiting unemployment compensation.

Re:They're acting like they're in trouble!

[painandgreed]

Nope. "At will" means a company can end employment for any or no reason.

For no reason, yes, but not for an illegal reason. What the illegal reasons are will vary from state to state. So, even if a company is ending somebodies employment for no reason, they still have to make sure they can defend themselves against the person claiming that it was for an illegal reason. Every now and then, it just turns out that everybody laid off for "no reason" are all the non-whites in the department, or the only person out of a group a few months from getting their pension. In those cases it turned out they had a case. (Anecdotal examples that did happen to coworkers of mine at various jobs.)

Re:They're acting like they're in trouble!

[jonatha]

Unemployment insurance is quite cheap, and the premiums are only paid on the first few thousand dollars of wages. The net effect is nowhere near paying two salaries, unless one of them is in Zimbabwe....

Re:They're acting like they're in trouble!

[jonatha]

IBM didn't lose the court case that counted (appeals court - SCOTUS denied cert). Anybody younger than about 50 at IBM is on a hybrid (cash balance) plan...

Re:They're acting like they're in trouble!

[jonatha]

Prevailing wisdom is IBM is a tech company, this plan applies to people who are retiring next year so they're about 64, right?

Retirement eligible after 30 years, so many in their early 50s...

Re:They're acting like they're in trouble!

[hairyfeet]

Well I'm happy for you as it sounds like Canada has a decent system but Google "Frivolous lawsuits USA" and you'll see some real doozys, like the guy that sued a drive cleaner for a billion dollars because they messed up his pants. Oh and you should watch TV in the USA in the daytime some time, the commercial are NOTHING but ambulance chasers looking for those who want to play lawsuit lotto. Here lawsuit lotto is a VERY real threat and sadly a reason why minority unemployment is so high compared to whites as whites as less likely to be able to scream "that's racist!" and get a free spin at lawsuit lotto.

Re:They're acting like they're in trouble!

[garaged]

I hope you are not rich with that kind of attitude !! :)

Re:They're acting like they're in trouble!

[dontclapthrowmoney]

I think they meant that they own the business, not the staff. I hope that's what they meant anyway.

Our labour laws do stifle productivity in some cases by impacting on hiring decisions, and they also protect staff in other cases. There's no one good solution that fits everyone/everywhere. Personally I'd like to see the labour laws that lean more towards protecting staff than helping businesses, just because that seems the right thing to do.

Really?

[Antony T Curtis]

I had thought that IBM had a problem with attrition among their mainframe programmers: More of them dying though natural causes than entering the field.

crossover point

[vlm]

If IBM were not closing in the US and moving completely to China and India as fast as they can, just like GE and a zillion other companies, lets figure out the crossover point:
Assume one months pay per year of employment.
This is guarantee of 70% of 18 months or about one years pay. Along with 18 months of health insurance, I'd assume.
So if you have more than 12 years in, you should risk it, you'll probably come out ahead. Less than 12 years in, you'd be better off taking the offer.

Most likely they're going to downsize every american citizen in their corporation, so you do appear to be better off taking the offer because its not a random distribution.

I'm also curious in salaried positions if you're expected to put in 50 hours per week for a "40 hour schedule", then what does 60% of schedule even mean, like you no longer work Monday and Friday at all, or you're still expected to put in 50 hours per week, except now on a imaginary "24 hour schedule"?

And a message for the last F500 employee in america, please remember to shut off the lights on your way out of the office...

Re:crossover point

[dimko]

Worked for them in czech republic, if anyone thinks to rellocate - don't bother, its not worth it.

Re:crossover point

[cpu6502]

Pretty soon if you want to keep your job, you will need to accept a salary equal to what an Indian software engineer would get. ($20,000)

Re:crossover point

[dubbreak]

I'm also curious in salaried positions if you're expected to put in 50 hours per week for a "40 hour schedule", then what does 60% of schedule even mean, like you no longer work Monday and Friday at all, or you're still expected to put in 50 hours per week, except now on a imaginary "24 hour schedule"?

I'm curious as well. It's not like IBM employees bill for every minute of overtime (especially where I live which falls under legislation lobbied by EA that excludes software developers from requiring overtime pay). My wife, a nurse, gets overtime in 15 minute increments (works 1-15 extra minutes gets paid for 15, 16-30 gets paid for 30 etc). If she was on a 60% schedule it would be explicit and any overtime would be paid out. Maybe they'll work a 3 day week? Sounds good to me, plus I put money you'd get a lot more bang for your buck. People tend to be more efficient when they work less hours and are better relaxed (from 4 days off).

Re:crossover point

[vlm]

If they'll accept the same level of software "quality", and if they'll accept made up resume stuffing and imaginary degrees, and if they'd accept everything taking 5 times as long as having a $60K local do it, I'd take that offer. Heck I'd take three or four of those jobs simultaneously. Now we're talkin...

Re:crossover point

[lgw]

My first software job paid less than that (in America). You have to get your start somewhere. But Indian software engineers (who aren't just out of colege) make more than that these days, in my experience. $30k, or more if in Bangalore (where costs of living can exceed Silly Valley).

Eventually it will be a global market, and you will have to work for about the same salary regardless of where, but the cost of living (and standard of living, at least for programmers) is rising quite fast in places like India these days - it's not really a race to the bottom.

Re:crossover point

[Anonymous Coward]

Your assumption of one months pay per year of employment is incorrect. IBM typically offers30 days notice and then two weeks pay per year of employment in its separation package. So really if you more than about 7 years in, take the deal.

Re:crossover point

[Gwala]

As a manager over a team in Shanghai; I can confirm that salaries are rapidly equalising there as well; you also need to pay very high payroll taxes (up to 40%); so the cost advantage is beginning to go away. (Where 5 years ago you could hire a team for the price of a single american developer; now you only get ~2 people)

On the upside; the food is better in China.

Re:crossover point

[Microlith]

Eventually it will be a global market

It's not a global market until I can move to the areas where the cost of living is cheaper and look for work on a whim. I can't, however.

It's a global market, but only for corporations.

Re:crossover point

[cpu6502]

There are many States with the union that are cheaper to live. For example instead of paying $4.50 for gasoline & $2000/month rent in California..... you could move to Oklahoma or Delaware and pay $3.20 and $800.

Re:crossover point

[afidel]

How much of that is salary inflation and how much of that is the rise of the Yuan against the dollar and Euro?

Re:crossover point

[lgw]

Everywhere I've lived before California, my actual cost of living was less than what a typical mid-career engineer in India gets paid. And the difference in standard of living on that pay is .. complicated. He gets a household staff, but I get clean air and easy availability of houshold electronics.

And you do realize that blaming everything on corporations (like blaming everything on "the man") makes you sound like a whiney loser, right? Assuming you have any sort of full-time job in America, you're already in the top 1% of the world, and (despite the cost of living) living better than 95% of people who have ever lived. Life is simply more pleasant when you're appreciative of that!

What a crock of shit

[Anonymous Coward]

My father was just released from them last year. He was a senior level engineer 3 years away from retiring, and then they come out with this?

Re:What a crock of shit

[GungaDan]

"Hallo! My name is anonymous coward. You sacked my father. Prepare to learn Mandarin."

Re:What a crock of shit

[evil_aaronm]

Buddy of mine retired last May. Within a week or so, "See mans" came out with a voluntary retirement program. If he'd stayed 30 more days, he could've been eligible for 3 months pay for retiring just the same. It's hard to know these things ahead of time.

Sorry for your dad, bud...

Re:What a crock of shit

[Anonymous Coward]

The company my dad works at has rolling buyouts. As long as you are above a certain age, have been there for long enough, and agree to hold harmless and non-compete for 90 days, they allow you to take early retirement. They give benefits until you are at Medicare age (or can get them at another job) and 100% contributions to the 401(k) and a year's salary. You then work there until the next buyout windows starts (the next quarter), and then you retire.

Apparently, by doing it that way, they have had more people retire, rather than waiting until they literally can't work anymore, they are laid off or fired. Plus, they can hire three (almost four) entry level people at the average salaries of the retirees. It also greatly improved company morale as there was more certainty as to what would happen if revenues fell or the like. Plus, they have had the occasional retiree get rehired by the company after the revenues went up.

Re:old people don't know anything about computers

[ZorinLynx]

Heh, I'm sure you're being facetious.. but in the tiny event that you're not...

A while back we had some IBM big iron on campus, and our regular IBM tech was a guy in his (estimated) high 50s. Never have I seen someone who so *intricately* knows their shit as this man. He casually explained to me, while working, exactly what the capacitor cards do in the p690, why the system is designed the way it is, and so on. His troubleshooting ability was amazing, too.

This is expected when you have three to four DECADES of experience. A newly minted college grad may be able to sling C# code like there's no tomorrow but he won't have this experience.

I think IBM is making a mistake by letting these people go, and I'm betting they'll suffer down the line for it.

Does It Involve Being Digitized?

[sanman2]

Or can you stay in corporeal form?

Re:Does It Involve Being Digitized?

[ajlitt]

That explains Watson: an all-digital mechanical Turk that feeds on the souls of employees who expected a pension.

Incredibly good idea at any time

[Anonymous Coward]

I work for a large company where the senior folks have an attractive retirement plan. Since work is slowing down and there are fewer exciting projects to work on, more of these folks are deciding to leave. They can decide to pull the ripcord rather abruptly with an email saying they've decided to burn up their remaining vacation pay while waiting for their retirement package to be processed. It kind of sucks to need to talk with someone who is the sole holder of some technical data to find out they had announced their retirement the week before and are now gone.

On top of how their abrupt departure can leave some of us more junior people stranded, a lot of these guys don't know HOW to retire. They're so fully part of the Borg that once they separate, they have no idea what to do with themselves. Some come back eighteen months later as consultants or part time employees. Others sit at home and whither away. I don't think is as much a problem for Gen X'ers and younger, as we've got so much going on in our outside lives we can't wait to be free to pursue those interests. However, a lot of the senior people have given so much time to the company they're lost without it... institutionalized, if you will.

Yeah, I think this is a great idea, whether it's to initiate a RIF or not.

Re:Incredibly good idea at any time

[SecurityGuy]

It kind of sucks to need to talk with someone who is the sole holder of some technical data to find out they had announced their retirement the week before and are now gone.

This is something many companies do badly, and one reason they may feel they have too many people on the payroll. They have no depth. They're a collection of single points of failure where every single one of them is guaranteed to fail, many in the next decade or so.

If your company has experienced employees who are the only holders of technical (or other) knowledge that is worth keeping, the time to worry about it is before they leave. It's before they get near retirement age. It's before your formerly gruntled employees become dis-. Really, the time to preserve it is not too long after it's become valuable.

Re:Incredibly good idea at any time

[Anonymous Coward]

On top of how their abrupt departure can leave some of us more junior people stranded, a lot of these guys don't know HOW to retire. They're so fully part of the Borg that once they separate, they have no idea what to do with themselves. Some come back eighteen months later as consultants or part time employees. Others sit at home and whither away. I don't think is as much a problem for Gen X'ers and younger, as we've got so much going on in our outside lives we can't wait to be free to pursue those interests.

I was in my cube, and I was just like reading Slashdot with my headphones on while my subconscious thought about how all these damn classes and methods fit together,
But then again I was reading about retiring,
And then my boss came in and I didn't even know she was there.
She tapped on my desk because I had the headphones on and I didn't hear her, and then she started screaming "MIKE! MIKE!"
And I go: "What, what's the matter?"
She goes: "What's the matter with you?"
I go: "There's nothing wrong,"
She's all: "Don't tell me that, you're slacking off!"
I go: "No, I'm not slacking off, I'm OK, I was just thinking you know, when a programmer stares at the walls he is working."
She goes: No! That's not Agile!"
I go: "No, I'm just thinking!"
She goes: "No, you're not thinking, you're slacking off! Productive people have more effective habits!"
I go: "Look, just tell me about the RIF programme, please?
All I want is to retire, roll over the 401(k), and she wouldn't let me.
Just a gold-spraypainted parachute.
And IBM wouldn't give it to me!
(I just wanted my retirement. AND THEY WOULDN'T GIVE IT TO ME!)

I'm not crazy! - INSTITUTIONALIZED!
You're the one that's crazy! - INSTITUTIONALIZED!
You're driving me crazy!- INSTITUTIONALIZED!
They stuck me in the Institution,
Building them an agile solution,
To help make sure my career is developed,
To protect them from the competition - myself.

I was sitting in my cube when the my boss and the HR manager came in and they pulled up a chair and they sat down.
They go: "Mike, we need to talk to you."
And I go: "Okay what's the matter?"
They go: "Me and the HR department have been noticing lately that you've been reading a lot of /. lately,
And you've been going off the grid for no reason,
And we're afraid you're going to hurt our bottom line,
And we're afraid you're going to hurt your career prospects.
So we decided that it would be in you're best interest if we helped you find a place
Where you could get the career guidance that you need.

And I go: "Wait, what are you talking about, WE decided!?
MY best interests?! How do you know what MY best interest is?
How can you say what MY best interest is? What are you trying to say, I'M crazy?
When I went to YOUR schools,
I went to YOUR six-sigma centers,
I went to YOUR sensitivity training seminars?!
So how can you say I'M crazy?
I'm not crazy! - INSTITUTIONALIZED!
You're the one that's crazy! - INSTITUTIONALIZED!
You're driving me crazy!- INSTITUTIONALIZED!
They stuck me in the Institution,
Building them an agile solution,
To help make sure my career is developed,
To protect them from the competition - myself.

Doesn't matter, I'll probably get laid off anyway.

Re:Incredibly good idea at any time

[sociocapitalist]

More likely they come back as consultants or part time employees because they're asked to and there's a need that they can fill that you more junior people aren't filling, not because they don't know what to do with themselves.

Re:Incredibly good idea at any time

[couchslug]

If I made good money at a more comfortable schedule and didn't mind my job on those terms, why not consult or part-time?

Re:old people don't know anything about computers

[Anonymous Coward]

Kid....computer and programmers existed long before your parents where born.
Making a statement like this only reveals that YOU don't know ANYTHING about computers.

Google Ada Lovelace, google Donald Knuth, google, Charles Babbage, google Sir Tim Berners Lee, google Steve Wozniak, google Konrad Zuse, google Wilhelm Schickard, google Blaise Pascal, Gottfried Wilhelm Leibniz, google Herman Hollerith. google Alan Turing.

YOU are N0ob. Now go back and play some idiotic shooter game.

Re:old people don't know anything about computers

[P-niiice]

They'll save money by cutting back on troubleshooting and move toward throwing in new cards. No need for that experience. Let the guy go and end up with another unemployed nobody who a certain party can blame for their "failure".

A Safe Way Out - Anecdotal

[cosm]

This is purely anecdotal, but from experiences with past co-workers who have been in the IBM trenches, it apparently isn't unheard of to get sacked a few months out from retirement at IBM, thus losing benefits or full retirement or whatever. So I'm guessing to those at IBM in the throes of fear of being sacked, this is perhaps an out to prevent being completely screwed and perhaps from an MBA standpoint a moral stabilizer (or destabilizer depending on your business unit).

Any IBM'ers feel free to chime in? My story is simply hearsay so I'd be interested in knowing how it really is under the various tentacles of that hydra.

Re:A Safe Way Out - Anecdotal

[cosm]

*morale, not moral; In terms of corporate morality, well that's all subjective :)

Re:A Safe Way Out - Anecdotal

[pak9rabid]

This happened to a good friend of my father's back in the '90s. He was a loyal employee of 27 years and they canned him right before retirement. Seems to be (or was) business as usual up there.

Re:A Safe Way Out - Anecdotal

[quacking duck]

Nortel did this as well, and got hit with a lawsuit by all the people they laid off just a few months or years from retirement. Nortel lost.

This happened a few years before my father was laid off in 2002, so although he no longer went in or did any work, he was "bridged" over to retirement age (a year and a half), at which point the pension kicked in.

Of course, we know what happened to the pension last year...

70% pay for 60% of their schedule...

[kungfugleek]

That's an empty promise. IBM will just keep forcing them to work overtime and now only pay them 70% of their salary.

Re:70% pay for 60% of their schedule...

[buk110]

That's an empty promise. IBM will just keep forcing them to work overtime and now only pay them 70% of their salary.

Nothing like some mandatory unpaid overtime to make up for mismanagement and under bidding on work.

Re:70% pay for 60% of their schedule...

[niks42]

Half of my 27 years with IBM was with free, unpaid overtime. Expected and delivered; early days I did it freely, but it became duty, then an irritation, then the weak-willed, lily-livered so-called management taking the piss. They are most definitely not the company I joined in 1977. I've been fortunate enough since then to work in a series of engagements with companies who value the greying hair and thousand yard stare. I try not to bore them with old school anecdotes, but I do try to deliver a work ethic and core values that I once learned at IBM.

Ran it through Google's Bullshit Translator

[crazyjj]

Ran "Guaranteed employment through Dec. 31, 2013 and offers participants 70% of their pay for working 60% of their schedule" through Google's Bullshit Translator and got back "We'll promise to keep you on for another year if you'll agree to a 30% pay cut."

Re:Ran it through Google's Bullshit Translator

[Anonymous Coward]

From: RMAC COMM/Armonk/IBM
To:
Date: 05/01/2012 08:16 AM
Subject: Announcing IBM’s new Transition to Retirement program

Dear IBMer:

IBM is pleased to notify you of your eligibility to apply for a one-time, voluntary program for IBMers in the U.S. nearing retirement. Called Transition to Retirement, it offers a gradual way to retire, with advantages for both you and the company.

If approved to participate in the program, you’ll receive 70 percent of your current pay while working 60 percent of your current schedule. You’ll also receive the same benefits you do today, most at a full-time level, including health insurance and 401(k) Plus Plan automatic company contributions. Due to the experience and skills you possess and the business need to close the gaps your departure would create, you’ll be exempt from any resource actions that may occur during the Transition to Retirement period. You agree to retire on December 31, 2013 -- or earlier, if you choose to do so.

IBM is offering this program to address issues facing American businesses and employees alike.

In recent years, American workers, including IBMers, have been asking for ways to gradually ease into retirement – maintaining a certain level of pay and benefits while freeing up time to explore what to do in their next phase of life.

At the same time, businesses, including IBM, want the ability to forecast when employees may retire so they can better plan.

The Transition to Retirement program was designed to address these issues. We believe it balances the needs of our U.S. retirement-eligible employees with the needs of our business.

For you, it provides a way to scale back on IBM commitments so you can explore what to do when you retire, whether that involves a second career, volunteer work or other meaningful ways to fill your time.

For IBM, it provides advance notice of when IBMers will retire, giving managers time to work with their teams to identify key skills and knowledge, while maintaining commitments to our clients and the business.

Financial planning and retirement resources – including MoneySmart seminars, individual coaching sessions and other programs -- are available to help you decide if Transition to Retirement is right for you. Much more information, including eligibility requirements, start dates, resources and application procedures can be found on the w3 Transition to Retirement for Eligible IBMers resource page.

Whether you ultimately decide to participate, IBM encourages you to use the resources available to help you plan what you’ll do when you are ready for that next phase in life.

Sincerely,

Randy MacDonald
Senior Vice President, Human Resources

Re:old people don't know anything about computers

[cdrguru]

This is the sort of attitude that permeates the computer industry today. This is why we have people building software that absolutely and faithfully recreates the problems that were solved in the 1960s and 1970s - the people doing the work have absolutely rejected the idea that there is anything to learn from the past. History is dead to them because they think everything they are doing is new and different. They think they are striking out in unknown territory when in fact they are just walking alongside the same path that was covered 40 years ago.

Today, many of the same problems that are encountered are simply recreations of things that happened before. A huge problem is file systems that do not have sufficient robustness to deal with unexpected outages and hardware errors. If you have a file system that fails if you shut the power off unexpectedly at the wrong time you have something that was designed from a blank piece of paper. This kind of problem was dealt with in the 1970s in several different environments but nobody working on recent file systems have any experience with those solutions. Mostly because "it is all new" is an attitude and considering anyone over the age of 40 to be outmoded and incapable of dealing with all this new stuff.

Re:old people don't know anything about computers

[P-niiice]

Companies think they can build systems to retain the knowledge that actual experienced employees would give them. And they end up spending multiples of their salaries to do it. And it never works, and always gets torn down for the next management book of the month.

Will these IBM execs be there after 2015 . . . ?

[PolygamousRanchKid]

Or, will "those who were responsible for the sacking, have been sacked" . . .?

Back in the early 90's, when IBM nearly cratered, then CEO John Akers hatched a plan to break up the company, because he didn't know else what to do.

Akers got the boot, Lou Gerstner came in, and reversed the break up.

IBM is undergoing an ambitious plan for growth up to 2015, and these cutbacks are part of the plan. We'll know in 2015, if it worked. If it doesn't. Well, those planners will be getting the 70% / 60% offers.

Re:Will these IBM execs be there after 2015 . . .

[niks42]

In what way was the breakup reversed? Thinking of Toshiba - LCDs, Lenovo - Thinkpads, Hitachi - Storage, Cisco - Networking Hardware, AT&T (WAN), Lexmark (printers) ..all companies that took over product lines. Thinking of the manufacturing plants that were sold off.

UNtil they don't.

[WOOFYGOOFY]

Get real. What do you think a retirement / pension "guarantee" ever was? And what happened to those promises? Chapter 7, that's what happened. Look at all the workers who were promised future benefits in lieu of today's pay and then none of it ever materialized.

IBM is like, the MOST cynical place to work after Intel, which IS the WORST place to work, ever.

R. X. Cringely's take on this

[Lee_Dailey]

howdy y'all,

take a look at this set of articles by the original Cringely.
- Not your father's IBM (I, Cringely - Cringely on technology)
http://www.cringely.com/2012/04/not-your-fathers-IBM/

it's a very well thot out condemnation of ibm and it's planned 75% north america emloyee count reduction. definitely bean counters doing their usual "forest for the trees" gutting of a company.

take care,
lee

Re:old people don't know anything about computers

[Anonymous Coward]

I retired from IBM 11 years ago. I shared you experience - the old dudes knew their stuff. Nowadays, everything is "contingent." I have to wonder about how loyal IBM customers will take to having someone without that experience show up at their location without such knowledge. Back in the early 70's, the R&D department I worked in had its own 370/168 machine. It broke frequently. The CE (customer engineer) assigned to it, George, had about a zillion years of experience. When we phoned in a problem, George would show up, look at the console lights for a minute, and zip straight to the problem. It'd be fixed within minutes. Nowadays, the hardware is far more reliable...are the CE's?

Except IBM has been a cash balance plan since 1999

[tlambert]

You have your facts wrong; IBM has a cash balance plan ("hybrid plan"). They didn't lose the lawsuit, and the Supreme Court refused to hear the appeal after IBM won.

Specifically, July 1, 1999; I was an IBM employee at the time they converted.

In a cash balance pension plan, like a defined benefit plan, there is no favoritism in contribution for tenure, so getting rid of the older workers doesn't benefit IBM, so long as the older workers are productive.

You should read up on cash balance plans: http://en.wikipedia.org/wiki/Cash_balance_plan

You should also realize that ranknfile-ue.org and endicottalliance.org (alliance@ibm) are propaganda arms of the CWA (Communications Workers of America) union, and that the CWA has been trying to get their camel's nose into the IBM tent for forever, ever since they saw the handwriting on the wall about the Internet becoming a big deal. They have their origins in the telephone industry: http://en.wikipedia.org/wiki/Communications_Workers_of_America#History

When I was at IBM, we never gave them the time of day.

* First of all, very few IBM employees are technically communications workers; all of the CWAs historical strikes to date have been against telephone companies.

* Second, we were very well paid with very good benefits, and there was no reason to hold IBM's butt to the fire in exchange for the CWA getting a percentage of our paychecks to line their pockets.

You really need to RTFA and look at who sourced it.

-- Terry

Re:Except IBM has been a cash balance plan since 1

[alexander_686]

I stand corrected. My memory is playing tricks on me. I remembered that IBM had aggressively encouraged employees to switch from a define pension over to the cash balance account and that things had gone poorly, and thus IBM had a surplus of define pension plans (which are affected by interest rates).

By the way, from my perspective you took a sharp turn with the 2 organizations which I did not follow. I had to look those up.

The thing to remember

[gelfling]

Is that in IBM and so many other companies, the C-level staff changes, the Board changes, the employees turn over but the top people in HR NEVER DO. And no one even really knows who they are, what their plans are, who they're accountable to or what their direction is. Their job seems to amount to nothing more than creative and stealthy ways to fire people.

To all the libertarians here who are cheering, I'd ask "Why do the HR tools even have jobs if they've done such an astonishingly bad job at OVER hiring in the first place?"