IBM Offers Retirement With Job Guarantee Through 2013 192
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."
Really? (Score:4, Interesting)
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 (Score:5, Interesting)
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...
What a crock of shit (Score:3, Interesting)
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?
Incredibly good idea at any time (Score:4, Interesting)
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.
70% pay for 60% of their schedule... (Score:4, Interesting)
Re:Incredibly good idea at any time (Score:4, Interesting)
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:They're acting like they're in trouble! (Score:2, Interesting)
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:crossover point (Score:5, Interesting)
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.