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Highlights—April 26, 2008

  • Yahoo! IBM Retiree Information Interchange: New Retiree and some disturbing retiree medical plan costs...what to. By "dukemisfit". Full excerpt: OK- I am a newly minted IBM retiree as of Dec 1st last year. I preceded my retirement with a bridge to retirement and as such was covered for a year under the IBM employee medical coverage at the employee rates.

    I am a fairly young person- I delude myself into thinking this anyways, as I am not yet 55 but I did put in my 30 years here at IBM Burlington in Vermont. I am quite aways from Medicare coverage for myself and my spouse. She works part time and uses my benefits. I just was switched from the employee plan to the retiree plan. I have no problem telling you all I was covered under an HMO plan here in VT. for myself, wife and one child still in college. I paid $241.00 per month for this plan as an employee. When I switched to the retiree equivalent plan - they called it a "low copay HMO option" with the same coverage, etc, my cost went to $1750 per month.

    Needless to say, I am in shock and need to do something here to reduce this cost. I and my family are all healthy and maybe aside from getting an annual physical, women's checkups, etc. do not have any real medical usage. I really want catastrophic coverage and maybe a well visit for a checkup every year. Now, I will be calling the benefits dept. to get all the info I can on my options but I just wondered if there was any other folks in a similar scenario as myself and what lower cost options there might be.

    I have a Future Health Account that IBM put aside for me the years I was working and I had hoped to have this augment my costs until Medicare kicks in. But at these rates, it will not last two full years!! Living in Vermont there are not a lot of outside insurance companies that offer anything here. There are not AARP plans, etc. that are offered in this state- legislation has driven insurance companies out of the state.

    I guess I just can't get my head around going from $240/month to $1750/mo for the same thing. Its totally insane but I never really had to face rates like this. Is this really a "benefit" for retirees with costs like this?? Anyways, thanks for letting me vent. I was glad to find the group and look forward to participating in the future.

  • Yahoo! IBM Employee Issues message board: Alliance@IBM stockholder meeting press release. Full excerpt: Alliance@IBM Members,Shareholders to Challenge IBM Over Off shoring, Executive Compensation at Annual Shareholder Meeting in Charlotte, N.C., on April 29.

    Charlotte, N.C. – IBM Corp. employees, members of Communications Workers of America Local 1701, Alliance@IBM, will rally and set up an informational picket line outside the IBM annual meeting set for April 29. The group will focus on critical issues for employees and retirees, including executive compensation, the continued off shoring of jobs, employee pay cuts, and shrinking retiree pensions with no cost of living increases, among other issues.

    "While IBM employees face a decline in their standard of living and retirees see pension checks evaporate due to the lack of cost-of- living adjustments coupled with increases in medical retirement co- pay, our executives live the life of luxury. Executive greed and bloated compensation needs to be challenged," said IBM employee and Alliance Vice President Earl Mongeon. Mongeon submitted Proposal No. 4 on Executive Compensation that asks the board of directors to determine that pension income from any defined benefit plan will not be used as a factor in setting executive compensation.

    Lee Conrad, National Coordinator of Alliance@IBM CWA, is calling on IBM to stop shifting U.S. jobs to low cost countries. "At a time when the US economy is in recession and unemployment is rising, it is unconscionable for companies like IBM to continue to move work offshore. The Alliance is urging elected officials, community leaders and citizens to call on IBM to halt this destruction of U.S. jobs."

    "The Alliance@IBM CWA strongly encourages IBM to be fully transparent in the number of jobs being sent off shore and to detail how many U.S. jobs are lost because of IBM's shifting this work to low cost countries," said Linda Guyer, president of the Alliance@IBM CWA Local 1701.

    Picket line at Charlotte Convention Center at 8:30 am, Tuesday, Apr. 29 Rally at close of IBM annual meeting, 12:30 pm.

  • Newsday: Outsourced to India: Stress. By Laurie Goering. Excerpts: After two years working nights at a U.S. company's computer call center, Vamsi knew it was time to quit when his 6-year-old son brought home a school portrait he'd drawn of his father, asleep in bed. "He was asked to draw a picture of his mom and dad, and he drew me sleeping. That's the only way he ever saw me," remembers the 31-year-old, who like many southern Indians goes by only one name. "He never saw me doing anything else."

    Indians may have taken over three-quarters of the world's call-center jobs, but they've also taken on the stresses of those jobs: weight gain, depression, boredom and, often, relationship troubles. Worse, for the legions in India busy helping Americans reboot their hard drives or refinance their mortgages, the problems are often more severe, both because of cultural differences and because the work, by virtue of time differences with the U.S., largely takes place at night.

  • New York Times: Worked Over and Overworked. Excerpts: In the last couple of decades, corporate profits and executive salaries have soared. But for many workers, the only thing that has increased is insecurity. In “The Big Squeeze: Tough Times for the American Worker,” Steven Greenhouse, a labor and workplace reporter for The New York Times, examines the difficulties faced by workers at companies like FedEx and Wal-Mart, and points to Patagonia and Costco as models for corporate America. The book was published by Knopf on April 15. Chapter One is excerpted here.

    In his job at a Wal-Mart in Texas, Mike Michell was responsible for catching shoplifters, and he was good at it, too, catching 180 in one two-year period.

    But one afternoon things went wildly awry when he chased a thief — a woman using stolen checks — into the parking lot. She jumped into her car, and her accomplice gunned the accelerator, slamming the car into Michell and sending him to the hospital with a broken kneecap, a badly torn shoulder, and two herniated disks. Michell was so devoted to Wal-Mart that he somehow returned to work the next day, but a few weeks later he told his boss that he needed surgery on his knee. He was fired soon afterward, apparently as part of a strategy to dismiss workers whose injuries run up Wal-Mart’s workers’ comp bills. ...

    At a Koch Foods poultry plant in Tennessee, the managers were so intent on keeping the line running all out that Antonia Lopez Paz and the other workers who carved off chicken tenders were ordered not to go to the bathroom except during their lunch and coffee breaks. When one desperate woman asked permission to go, her supervisor took off his hard hat and said, “You can go to the bathroom in this.” Some women ended up soiling themselves.

    Don Jensen anticipated a relaxing life of golf after retiring from his human resources post with Lucent Technologies in New Jersey, where he was in charge of recruiting graduates from Stanford, Cornell, MIT, and other top universities. But when Lucent increased its retirees’ health insurance premiums to $8,280 a year, up from $180, Jensen was forced to abandon his retirement. He took a job as a ten-dollar-an-hour bank teller. ...

    One of the least examined but most important trends taking place in the United States today is the broad decline in the status and treatment of American workers — white-collar and blue-collar workers, middle-class and low-end workers — that began nearly three decades ago, gradually gathered momentum, and hit with full force soon after the turn of this century. A profound shift has left a broad swath of the American workforce on a lower plane than in decades past, with health coverage, pension benefits, job security, workloads, stress levels, and often wages growing worse for millions of workers. ...

    Since 1979, hourly earnings for 80 percent of American workers (those in private-sector, nonsupervisory jobs) have risen by just 1 percent, after inflation. The average hourly wage was $17.71 at the end of 2007. For male workers, the average wage has actually slid by 5 percent since 1979. Worker productivity, meanwhile, has climbed 60 percent.

    If wages had kept pace with productivity, the average full-time worker would be earning $58,000 a year; $36,000 was the average in 2007. The nation’s economic pie is growing, but corporations by and large have not given their workers a bigger piece. The squeeze on the American worker has meant more poverty, more income inequality, more family tensions, more hours at work, more time away from the kids, more families without health insurance, more retirees with inadequate pensions, and more demands on government and taxpayers to provide housing assistance and health coverage. ...

    A 2007 report by the Congressional Budget Office found that the top 1 percent of households had pre-tax income in 2005 that was more than two-fifths larger than that of the bottom 40 percent. (After taxes, the top 1 percent’s income in 2005 was still nearly 10 percent greater than the bottom 40 percent’s.) As Paul Krugman wrote, “It’s a great economy if you’re a high-level corporate executive or someone who owns a lot of stock. For most other Americans, economic growth is a spectator sport.” ...

    Pensions, the other pillar of employee benefits, are under assault as never before. In May 2005, a bankruptcy judge allowed United Airlines to default on its pension plans and dump them on the federal agency that protects retirement benefits. Because that agency guarantees pensions only up to a certain amount, many United pilots will receive only half what they expected when they retire. United’s move was the biggest pension default in American history, releasing it from paying $3.2 billion in obligations over the following five years. One of United’s lawyers predicted that more and more companies would use this “strategic tool” to increase their competitiveness. Since then, US Airways and Delta have followed suit. When Delphi, the auto parts giant, filed for bankruptcy in October 2005, its chief executive, Robert S. Miller, threatened to slash the company’s pensions unless the workers agreed to massive wage concessions.

    As part of this assault on pensions, Hewlett-Packard, IBM, Verizon, Sears, Motorola, and many other companies have embraced a riskier, far less generous type of retirement plan, 401(k)s, while turning away from the traditional plans that promised workers a specific monthly benefit for life after they retired. When Hewlett-Packard took that step, a company spokesman said, “Pension plans are kind of a thing of the past.” With pensions growing ever scarcer, more and more workers are convinced that they won’t have enough money to retire. Ominously, some economists have begun to warn that millions of Americans might have to continue working into their seventies. ...

    Employee productivity has also far outpaced wages, rising 15 percent from 2001 through 2007.) Corporate profits have climbed to their highest share of national income in sixty-four years, while the share going to wages has sunk to its lowest level since 1929. “This is the most pronounced several years of labor’s share declining,” said Lawrence Katz, an economics professor at Harvard. “For as long as we’ve had a modern economy, this is the worst we’ve seen it.” Very simply, corporations, along with their CEOs, are seizing a bigger piece of the nation’s economic pie for themselves, leaving the nation’s workers and their families diminished. ...

    The squeeze on the American worker has been further exacerbated by corporate America’s growing sway over politics and policy, making it harder for beleaguered workers to turn to government for help. When investigators unearthed serious child labor violations at a dozen Wal-Marts, officials in the Bush Labor Department signed a highly unusual secret agreement promising to give Wal-Mart fifteen days’ advance notice whenever inspectors planned to visit a Wal-Mart store to look for more such violations. Wal-Mart officials had been major donors to the Republican Party. ...

    Nor have the tax policies emanating from Washington been very friendly to workers. President Bush and Republicans in Congress pushed vigorously to minimize taxes on investors, that is, taxes on dividends and capital gains, while urging elimination of the estate tax. Bush’s tax cuts saved the average middle-class taxpayer $744 a year, while saving $44,212 a year for the top 1 percent of taxpayers and $230,136 for the top one-tenth of 1 percent of households.

  • CNET News: Republicans ramp up pressure for H-1B increase. By Anne Broache. Excerpts: This year, Congress must raise the cap on H-1B temporary work visas beloved by technology companies, a coalition of conservative Republican politicians urged Democratic leaders late last week. In a letter to Speaker Nancy Pelosi (D-Calif.) and Majority Leader Steny Hoyer (D-Md.) on Friday, 30 members of the U.S. House of Representatives Republican Study Committee called for a vote within the next few months to raise the quota. By law, that limit currently stands at 65,000, with an additional 20,000 allocated for foreigners with advanced degrees from U.S. institutions. Here's a snippet:
    Every year, American businesses tell us how they are unable to retain the qualified people that they want to retain because of the artificially low H-1B visa caps and related regulations that do not reflect market realities. This situation is ironic, since most of those unemployable people were educated in the United States. As a country, we are effectively handing these highly educated, extremely desirable individuals a diploma and a plane ticket. The message we are sending is: "You can learn here, but you have to work in another country."

    ... A number of bills in Congress would raise the H-1B cap, at least for a few years, by double or triple the existing amount. The Republican Study Committee named yet another bill, known as the Skil Act, that would elevate the number of visas to 115,000 and raise the cap by 20 percent after each year in which that bar was met.

  • New York Times: The Odds for a Retirement Nest Egg, Recalculated. By Mark Hulbert. Excerpt: Conventional wisdom recommends that investors start with a high allocation of stock in their portfolios when they are young and reduce it as they approach retirement. That makes intuitive sense: In your 20s, you may be inclined to take bigger risks; in your 60s, you may feel a greater need to protect the wealth you have been able to amass.

    But a recent study of real-world portfolio returns, which fluctuate significantly from month to month and year to year, has found that there is no particular advantage in this approach. You would do just as well, with no greater odds of doing poorly, by simply picking an allocation of stocks and bonds that you can live with for a long while and sticking with it.

  • BuzzFlash: Senator Bernie Sanders Stands Up For the Middle Class and Takes on Corporate Mainstream Media. Excerpts: "Year after year, the Bush people come forward and say how great the economy is, and that's full of crap. Since Bush has been President, median family income has gone down. For working families, it's gone down hundreds of dollars. Five million more people have slipped into poverty. Eight million people have lost their health insurance. Three million Americans have lost their pensions. And we have lost millions of good-paying jobs." ...

    That's important, because since the Reagan administration, the Republicans -- with the enabling of most Democrats -- have swept the mugging of the middle and lower classes under the rug. Every time a Democrat brings up the plight of the working class and the poor, he or she is accused of engaging in "class warfare" by the Republicans. Of course, the GOP domestic economic policies since Reagan have been an actualized strategy of conducting a class war, in which the few select wealthy Americans at the top have become engorged with money at the expense of everyone below them, meaning the other 99.5% of us. But don't dare talk about it, as they pummel any meaningful discussion into the ground. ...

    It hasn't been a strong economy. The confusion rests with the fact that Bush's pals in the top 1% and one-tenth of 1% have been doing extremely well. Almost all of the wealth that has been created in recent years has gone to the top 1%. But the middle class is in steep decline, and in deep distress. That was the case before the foreclosure crisis, and that is even more so today.

  • Detroit News: Iacocca bashes Bush in new book. Ex-Chrysler CEO also rips Congress, but the harshest criticism goes to president's leadership. By Gordon Trowbridge. Excerpts: "Am I the only guy in this country who's fed up with what's happening?" Iacocca writes. "Where the hell is our outrage? We should be screaming bloody murder. We've got a gang of clueless bozos steering our ship of state right over a cliff, we've got corporate gangsters stealing us blind, and we can't even clean up after a hurricane much less build a hybrid car. But instead of getting mad, everyone sits around and nods their heads when the politicians say, 'Stay the course.' " ...

    And he scoffs at Bush's business-degree background: "Thanks to our first MBA President, we've got the largest deficit in history, Social Security is on life support, and we've run up a half-a-trillion-dollar price tag (so far) in Iraq. And that's just for starters."

  • Jim Hightower: A Special Break for Corporate Criminals. Full excerpt: If you got caught robbing a bank, chances are excellent that you'd be facing some serious time in the pokey. But what if a bank robs you? Corporate executives and their lawyers like to claim that a corporation is a "person" with all of the rights of an actual human being. Yet, when one of these outfits goes bad and gets caught violating laws – then, the lawyers drop the pretense of personhood, insisting that while this entity might be fined, it can't be put in jail or given a death sentence, because... well, because it's a financial structure, not a human.

    Embracing this game of now-you-see-us / now-you-don't, the Bushites, have devised a neat way to go soft on corporate criminals. Called "deferred prosecution agreements" – or "DPAs" – this ploy allows corporations and banks that are guilty of everything from robbery to bribery to be given a get-out-of-jail-free card. Monsanto, Merrill Lynch, and some 50 other corporations have recently been allowed to pay a relatively cheap fine and agree to certain internal reforms rather than be prosecuted for their crimes. Under this scheme, even the big mortgage hucksters who have defrauded so many home buyers and wrecked our housing market could end up writing a check and walking away.

    DPAs were originally meant to help real people (usually first offenders) get a second chance, but they've become the favorite wrist-slap of Bush prosecutors and corporate violators. They argue that full prosecution could be "a corporate death sentence" with "catastrophic collateral consequences," so these criminals shouldn't be treated like mere people.

    Of course, such judicial favoritism creates an incentive for criminal behavior, since corporations now know that they can likely avoid prosecution if caught. And fines are no deterrent – multibillion dollar corporations can simply absorb them as a necessary cost of doing business.

  • The Economic Times (India): Subprime hits where it hurts most - pay hikes. Excerpts: The woes of the IT sector are far from over. Faced with a challenging business environment in the wake of the US subprime crisis, software major Oracle has pared annual salary hikes while IBM is cutting employee perks. The average pay hike at Oracle India as well as Oracle subsidiary i-Flex solutions is down to nearly 7-8%, dipping to 5% in some cases. On the other hand, IBM India is attacking fringe benefits offered to its middle management — it has withdrawn the free-housing (on lease) facility recently.
News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
  • New York Times: Before Medicare, Sticker Shock and Rejection. Excerpts: If you want to retire before you are 65 and eligible for Medicare, health insurance is vital to your plans. Without it, you risk losing everything. Less than a third of employers offer retiree health benefits, down from almost half in 1993, according to a survey by the Mercer Health and Benefits consulting firm. Those without retiree health benefits who are eligible can use a patchwork of federal and state laws to build an insurance bridge — although an expensive one — to Medicare.

    Usually, however, the best, least-expensive option is to buy an individual policy, but that can be problematic if you have pre- existing health conditions. Just ask Henry and Kathy Hamman. ...

    Before leaving Florida, the couple filed an application for a policy with BlueCross BlueShield of Tennessee, and provided medical records. “The agent suggested that we might get ‘uprated’ for some relatively minor pre-existing conditions,” Mr. Hamman recalled. “We were fully expecting to pay as much as $500 a month.” A few days later, their insurance agent called. BlueCross BlueShield had turned them down.

    “We were stunned and flabbergasted,” Mr. Hamman said. “I had only been in the hospital overnight twice in my entire life — once to have my tonsils removed and once for elective sinus surgery. Kathy had been in the hospital once for an elective procedure and another time when she was 11 years old to have her appendix removed. We are both runners.”

    Over the years, he said, he had occasionally dealt with “slightly elevated cholesterol,” which was one reason BlueCross BlueShield rejected him. He said Mrs. Hamman was denied “because of slightly elevated blood pressure, which was easily controlled by inexpensive medication.” ...

    The Hammans were lucky because they could get coverage. “Trying to buy an individual policy is tough,” said Stephen L. Wyss, the managing director of Affinity Group Underwriters in Glen Allen, Va. “About 40 percent of people in the 55-to-64 age group that we try to place are getting turned down because of pre-existing conditions. Almost everybody has some kind of health problem. Many may not be able to get insurance even if they can afford the premiums.”

  • Forbes: Tiered Health Care Catches On. Excerpts: Health insurance companies are shifting the cost of expensive prescription drugs on to patients, part of a larger trend toward "tiered" private health insurance coverage. Although employers support these measures, vulnerable patients are being exposed to great financial risks. Health insurers are struggling to adapt to surging health care costs in the U.S. The newest development in private health insurance is the introduction of a fourth tier of cost sharing ("Tier 4") in prescription drug coverage. The basic types of pharmaceutical tiering are as follows:
    • Tier 1: One small co-payment, regardless of the drug.
    • Tier 2: One co-payment for generic drugs; a higher co-payment for non-generic drugs.
    • Tier 3: One co-payment for generic drugs, a higher co-payment for "preferred drugs" and an even higher payment for "non-preferred" or "non-formulary" drugs.
    • Tier 4: an additional fourth level requires exceptionally high co-payments or co-insurance rates for specific drugs that are typically experimental, new and very expensive. ...

    The fact that the move toward Tier 4 is adversely affecting a particularly vulnerable population raises ethical issues, not least the widening gap in access to health care between the wealthy and non-wealthy. This may attract the attention of policymakers.

  • New York Times: Benefit Managers Profit by Specialty Drug Rights. By Milt Freudenheim. Excerpts: Doctors treating children with a rare and severe form of epilepsy were stunned by the news. A crucial drug, H.P. Acthar Gel, that had been selling for $1,600 a vial would now cost $23,000. The price increase, put in place over last Labor Day weekend, also jolted employers that provide health benefits to their workers and bear the brunt of drug costs.

    As it turned out, the exclusive distributor of H.P. Acthar Gel is Express Scripts, a company whose core business is supposed to be helping employers manage their drug insurance programs and get medicines at the best available prices.

    But in recent years, drug benefit managers like Express Scripts have built lucrative side businesses seemingly at odds with that best-price mission. A growing portion of their revenue comes from acting as exclusive or semi-exclusive distributors of expensive specialty drugs that can cost thousands of dollars. And the prices of such medicines are rising much faster than for the mainstream prescription drugs available through a wide variety of distributors. ...

    The main drug benefit managers make as much as 10 to 15 percent on each sale of a specialty drug, whose prices can range from $5,000 a year for certain anemia drugs to $389,000 in the case of Soliris, a drug for a rare blood disorder, whose distributors include Express Scripts’ specialty drug unit, CuraScript.

  • Financial Week: Latest health-coverage fad goes thud. As interest in consumer-driven plans falters, companies try different mixes of incentives, penalties. By Fay Hansen. Excerpts: When T. Rowe Price installed its consumer-driven health plan in 2004, it was in an optimal position to make the plan work. With almost 5,000 financially savvy U.S. employees and a sophisticated benefits program in place, enrollment in the plan hit a predictable 8% in the first year. Then enrollment remained utterly flat for three years, until 2008, when it inched up to 9%. And there it sits, with enrollments too low to produce substantial savings, no real incentives or deterrents to boost participation and no meaningful tools to help employees be good consumers.
  • American Prospect: Health Reform You Shouldn't Believe In. What the Massachusetts experiment teaches us about incremental efforts to increase coverage by expanding private insurance. By Marcia Angell. Excerpts: For all their promise of change, Democrats are remarkably timid about changing the health-care system. The system now costs twice as much per person as those of other advanced countries and delivers worse average outcomes. It prices tens of millions of people out of health coverage altogether and limits care for countless others. Yet leading Democrats are clinging to this system, proposing to cover more people but not changing the system itself except at the margins. The timidity extends to choice of words. No one is supposed to say "single-payer" or "national health insurance" anymore, because that is "politically unrealistic"; the most we are allowed is to talk of reforming the system incrementally so that someday it will morph into "Medicare for all."

    Thus, the proposals for reform taken most seriously by Democrats -- including Barack Obama and Hillary Clinton -- would retain the central role of the investor-owned private insurance industry as well as the thousands of for-profit businesses it pays to deliver medical services. This is the industry, mind you, that has brought us to the predicament we're in now, so let's take a quick look at it.

  • Wall Street Journal: New Thinking In Employee Health Care. by Randy Myers. Excerpts: Corporate America's long effort to shift more of the cost of employee health care onto employees themselves may be reaching its useful limits. Most employers have already boosted the percentage of health insurance premiums paid by their employees, and have adopted health plans that feature bigger deductibles and larger co-pays for plan participants. Now, says Blaine Bos, a worldwide partner with benefits outsourcing and consulting firm Mercer LLC, "The very largest employers recognize that cost-shifting has run its course. It does not improve long-term cost trends. It improves the trend for one to two years but then you're back in the same ball game, as health-care inflation continues to rise at about two times the rate of general inflation."
  • The Henry J. Kaiser Family Foundation: Federal Government Should 'Pay Its Bills' Instead of Shifting Health Care, Other Costs to States, Arizona Gov. Napolitano Writes. Excerpts: States are "in a precarious position" this year because the "economy is slowing down," revenues from taxes are declining and "demand for expensive services -- health care, food assistance and the like -- is growing," Arizona Gov. Janet Napolitano (D) writes in a Wall Street Journal opinion piece. Napolitano adds that states' "fiscal crunch is being made worse" by "misguided policies put in place by Congress and the Bush administration."

    She writes, "The Bush administration has perfected the nasty habit of cost-shifting to the states." For example, "in August 2007, President Bush stopped states from expanding SCHIP to cover children in families who earn more than 250% of the federal poverty level," and the "administration has also proposed or issued eight different regulations that alter the federal-state Medicaid partnership." The SCHIP rule will cause states to "carry the additional burden of providing health care for these children," and the Medicaid rules "simply shift costs to states and localities," according to Napolitano.

New on the Alliance@IBM Site:
  • Spotlight: As the Alliance@IBM CWA Local 1701 begins its Spring membership drive you need to know some hard facts.

    The Alliance has been losing members due to retirement, job loss and employee financial difficulties. This web site receives an average of 40,000 visitors a month.

    Tough economic times are obvious; however, we simply can not go on or take employee advocacy to higher levels if we don't build our dues paying membership. It is not just this web site: It is an office and an organization that is at stake. Our staff of 1 full time, 1 part time and volunteers/members are dedicated to building this organization; but it is up to YOU to see that we are able to keep the office open and the organization financially viable. We need to become financially independent--We can not continue to rely on being financed by non-IBM CWA members. IBM employees need to support their own organization!

    Frankly if IBM employees do not see the value of this employee organization then the future of our work is in jeopardy.

    Please consider joining the Alliance@IBM as a member for only $10 a month--the cost of a few Starbuck's coffees. Your dues and involvement help the Alliance with the following:

    • Organizing employees and challenging IBM on policies and practices detrimental to employees and retirees.
    • Exposing job cuts.
    • Helping employees to deal with redeployment and replacement training.
    • World wide media source for IBM employee issues.
    • Legal references and current labor law information.
    • Political action on employee issues.
    • Stockholder proposals and actions.
    • Working with International IBM employee Unions to develop worldwide responses to IBM employee issues.
    • Working with Federal, State, and Local officials to make sure IBM employees, IBM retirees and communities find information and remedies for toxic exposures from IBM sites.
    • Union privileges and benefits through Alliance@IBM's membership that are offered through the Union Plus /Privilege program.

    We also have the expense of keeping an office up and running: Rent, Office supplies, fax, phones internet access and mailings of organizing materials; such as newsletters, flyers and brochures.

    We believe Alliance@IBM has, by its very existence; given IBM Corporate Mgmt pause, during their anti-employee actions.

    The bottom line is that if we are NOT here, then IBM Corporate Management has the field. There will be some who say that employees do not want representation through an employee organization or a union. Now is the time: Prove them wrong or prove them right.

  • From the Job Cuts Status & Comments page
    • Comment 4/17/08: A friend of mine who still works in Rochester tells me that IBM has dropped all pretense of 'work-life balance' and renamed the process 'work life integration', which is a slick way of saying the company expects you to give to the company 100% and find a way to 'fit the rest of your life in' after serving the company. I had a sleazy acquaintance once who told me that 'his wife was married, but he wasn't'. It appears that IBM now has the same attitude. They expect you to be 'married' to them, but they have absolutely no loyalty to you. -RochFireball-
    • Comment 4/19/08: TO: RochFireball Work life balance has always been a myth like all the rest of the IBM nonsense. I used to bring that phrase up to my manager all the time when I was working crazy hours and weekends. It got a smile out of him but no balance in my life. Since the spring is coming, I should remind everybody, spring time is cut time so get ready for another round. It's tradition at big blow. -RAd_man-
    • Comment 4/19/08: We had a VP of our business unit come speak to us last year, and tell us that, sure everyone was working long hours, but "no one ever promised you spare time". I've never before worked as a software developer where my employer "needed" my home phone number to be able to call at any time in case of an "emergency". Is this the norm in the software industry in the US these days?? I sure hope not. -irRational-
    • Comment 4/19/08: to RochFireball: right on regarding work-life integration in the 'new' IBM... it has gone so far away from reality that on the new Global Opportunity Marketplace (jobs site), 5-day per week travel is now referred to as a 75% level because you're home on weekends!!! -Anon-
    • Comment 4/20/08: Dear RochFireball, YOU'RE ABSOLUTELY RIGHT. Being here for more than 27 years, I don't feel I am an employee to IBM anymore. I am a SLAVE to IBM. Slave is the right word period! My house chores and projects are way behind because I keep giving up my personal time to IBM to do extra work. I no longer can volunteer for local charities or do the community services. I regretfully accepted a laptop, next time I'll ask for a desktop computer so I can't do IBM work from home on weekends and vacation. They do expect us to spend a couple of hours at night when you are on vacation. Some of my IBM friends are smart enough to indicate in their AWAY message "I'm gone for fishing in Maine, no phone and internet access until I'm back in office". I'm not an IBM employee. I repeat I am an IBM slave. -From an IBM Slave-
  • General Visitor's Comment page:
    • Comment 4/21/08: I had high ratings and skills (MBA, BS Comp Sci) IBM says it has trouble finding (as did my entire group), but we got axed all the same. (...says Vera Chota, manager of university recruiting for IBM. Certain skills still are in strong demand, says Ms. Chota, adding that the company can't find enough qualified graduates with degrees in computer science and those who have knowledge of both business and IT.") Maybe the problem is that people with those skills don't want to work at IBM! -What Nonsense-
    • Comment 4/21/08: There is nothing more important than adding new members to the Alliance@IBM. Stop living with your head in the sand! IBM is leading the way in the international race to the bottom, also known as the destruction of the middle class. WAKE UP !!!!! -RJM-
    • Comment 4/24/08: SO management is worried because they are seeing a troubling trend where; when IBM wins an outsourcing contract, less and less of the client's outsourced personnel are willing to take new jobs at IBM and instead are quitting. This increases the cost of the outsource project and if not accurately predicted, makes for a financial mess. More and more folks are viewing IBM as not a good place to work and are also seeing that going elsewhere gets them better pay and respect. Another troubling trend from the greedy bastards in Armonk, is that a rising number of outsourcing contracts are explicitly not allowing the use of overseas resources. -Slave in the Escape Tunnel-
    • Comment 4/24/08: I work on the BP Amoco contract here and BP has explicitly stated that no more of it's work will go overseas. They see the poor quality of work being done over there & want to bulk of it to stay here in Tulsa. Unfortunately for BP, many of IBM's knowledgeable oil & gas accountants are leaving. They're being replaced with fresh college graduates who have no clue about oil & gas. -tulsa_member-
  • Pension Comments page
  • Raise and Salary Comments
    • Comment 04/19/08: My org has yet to release the salary plan for this year. The excuse is that it is being held up because of the ongoing problems related to the poorly planned and ineptly implemented forced change of exempts to non-exempts with the 15% pay cut. I suspect there are other reasons. One of which is the oft rumored change of project managers and architects from exempt to the non-exempt w/ the 15% pay cut. The second reason may be that they don't want to book a generous salary plan when the economy is in a downturn. If the job market for IT people collapses and no IT jobs are available, IBM can have a minimal salary plan because employees won't leave for better jobs that don't exist. Whenever dealing with IBM, you ALWAYS have to consider the most sinister option. -Billy-

      Alliance reply: As we have said a number of times--it doesn't have to be this way. With a union and a contract; everything is negotiated and the contract life is a few years, so you know what is coming and you can plan.

    • Comment 04/20/08: Salary = 55K+; Band Level = 3; Job Title = Deskside Services; Years Service = 7; Hours/Week = 40; Div Name = ITD; Message = Hired on as band 6, chopped to band 4 and then again to band 3. No salary cut when moved from exempt to non-exempt. -Sinking_ship-
    • Comment 04/24/08: I just heard that my appeal was denied. I need some quick advice. I was a band 8 project manager. I actively sought a new job within my organization. The new job was a band 8 IT specialist. I actively began seeking this change in January 2007. An opening came up in August 2007. I took that new assignment which positioned me in the IT Specialist job family and this pay cut. Question I have, should I ask my managers when they knew this was coming and shouldn't they have told me it was a possibility back in August before I took the job? I don't know what I would have done as there were a variety of reasons I wanted a change. I will never know if I would have taken the job knowing a pay cut was coming because nothing was ever mentioned. Any advice? -Need Advice-
  • PBC Comments
  • International Comments
Vault Message Board Posts:

Vault's IBM Business Consulting Services message board is a popular hangout for IBM BCS employees, including many employees acquired from PwC. Some sample posts follow:

  • "Any tips?" by " rockandhardplace". Excerpts: Hi, another Big Blue escapee here. I have moved out of consulting completely and am now in what might be called an understudy for a customer project manager role. It's a small step up from the resume-killing roles that Big Blue had been putting me in ever since I got drafted straight out of college.

    The company I'm currently working for has offshored work to India in the past, and due to less than satisfying results(surprise, surprise), are starting to shop around. Can anyone share their experiences on working with offshore companies from other countries? Specifically, Vietnam, China and the Philippines?

    In the past, I have briefly worked on a project involving setting up a call-centre in the Philippines. I found the workers to be courteous, hard-working and communicated in English very well. Customers loved them. However, the only issue was that they could be too accommodating sometimes. Many training sessions involved trying to get across the concept of "scope creep" and which customer demands need to be escalated to change requests that require careful impact analysis. Promising customers the universe then being unable to deliver and/or causing further system instability = BAD! Overall, my experience with them was good and I have put them forward as a possible contender. Do any of you have any pros & cons regarding offshoring software development & support to the Philippines?

    As for India, my experience with them both in Big Blue and outside of it has consisted a lot of the following:

    • Phase 1: Everything is working somewhat smoothly
    • Phase 2: A few weeks or months down the line, the competent ones leave for a better opportunity. I've had onshored team members brag to me during lunch that they've moved companies 2 to 3 times now. Big Blue is not that big a deal to them. Managers are gobsmacked that comparatively low-paid Indians are also capable of trading up but assume that there's more where they came from.
    • Phase 3: We are forced to work with the bottom of the barrel while continuing to futilely seek skilled people. Offshore bosses think that we can't hear them coaching their employees on the 'correct' things to say during phone interviews.
    • Phase 4: Project progress going backwards. Expensive contractors called in. Some are worth what they charge, but more than a few aren't.
    • Phase 5: Project muddles through, after client begrudgingly gives the green light to several follow-up projects to clean up the mess of the first one. Contractors and offshore companies greedily eye the extra work. Client sometimes too lazy to shop around and allow it to go ahead.

    I have suggested taking on and training college grads, but as a previous thread in this board has mentioned already, many grads these days don't seem bright and/or motivated enough to tie their own shoelaces! I have pointed out that one of the star employees here is a grad that they hired 2 years ago, and who is motivated to stay with the company as this is his preferred city to live in. But people like him are getting quite rare. Looking forward to hearing your thoughts!

  • "Look for Low Cost Areas in the States" by "Frank_Reality". Excerpts: Consider some of the low cost states in flyover country in the US. States like North Dakota, South Dakota, Montana, Wyoming, Nebraska and Idaho. Low taxes, lower cost of living, which means lower salaries, lower benefit costs and less competition for employees, while the residents of these states have strong work ethic (read high productivity) and strong English skills. They're also relatively in sync with time zones (unlike India and China).

    By the way, the business my wife is in hired two Filipino staff members - they literally sponsored their immigration and they have worked out just great.

    Now, as for China and Vietnam and any other rapidly developing nation, the issue of keeping good workers will be a problem as long as demand overwhelms the supply of talent. And not only is this a retention issue, it's also a cost issue - if you want to keep the best, you'll have to keep the pay competitive.

    Second, I think you'll see a lot of the same issues with India in terms of a very thin pool of great talent and large pool of inexperienced or otherwise unprepared persons.

    Last, a) there is no free lunch, b) you get what you pay for and c) you only scream once when you buy quality.

  • "Treat Your People With Respect" by "eyes-wide-open". Full excerpt: Yet another senior person leaves to a competitor, and IBM says menacing things, sends menacing letters. The person is feeling screwed. Can they not finish the thought sentence of "I will screw this person" with "they will tell their very close client contacts" and certainly avoid ever recommending the blue pig to anyone. Dumbies. Assholes. They are who they are and they deserve the culture they are in. Missing the bigger message: "if you treated your employees with professional respect, they wouldn't be clambering to leave". They get what they deserve
  • "Leaving IBM soon - anything to not sign?" by "426_227". Full excerpt: I'm leaving in the next 2 or 3 weeks, and I'm wondering if I'll be asked to sign any forms that I am not obligated to sign? If there's anything they'll try and trick me with? It's sad, but I really don't trust IBM anymore. Any other tips are welcome. Should I roll over my meager pension to make sure it doesn't get taken from me in the future?
  • "Only sign if there is a financial benefit" by " bluedngone". Full excerpt: IBM will present you with forms to sign about benefits, assets and non-disclosure. Only sign if you feel there is a financial benefit. They cannot without pay, pension or accrued vacation pay. But they can withhold if you don't return your assets. Don't lose your laptop or discover that it has fallen off a 10 story building. Leave in dignity as fast as possible.
  • "No Severance, No Signature" by "ancientblueconsultant". Full excerpt: That's the rule of thumb. It is especially true of the "Reminder of Confidentiality". Don't sign anything, and I mean nothing. Even if they ask you to sign for a receipt for your badge or laptop, don't do it. They are adept and trying something at the last minute to try to trip you up. As to your money, yes, move it out. Although it may be cheaper to invest in IBM programs than on the outside, in a fast paced market you can lose your shirt because of the inherent delays in IBM savings program processes. Go somewhere where there are more options to invest in and more dynamic in allowing you to quickly and easily move investments in rapidly changing market conditions, which are becoming the norm.
  • "Treat Your People With Respect" by "eyes-wide-open". Full excerpt: Yet another senior person leaves to a competitor, and IBM says menacing things, sends menacing letters. The person is feeling screwed. Can they not finish the thought sentence of "I will screw this person" with "they will tell their very close client contacts" and certainly avoid ever recommending the blue pig to anyone. Dumbies. Assholes. They are who they are and they deserve the culture they are in. Missing the bigger message: "if you treated your employees with professional respect, they wouldn't be clambering to leave". They get what they deserve
  • "History + Autocratic Regime" by "ancientblueconsultant". Full excerpt: Unfortunately when you combine the history of an arrogant company culture and an autocratic self-assuring management that's what you get. The culture is reverting back to the early 90's late 80's when they just couldn't handle rejection or abandonment by any of the good slaves looking better opportunities.

    On a related point, I've heard rumblings that Strategic Outsourcing is having a real tough time convincing folks that have been outsourced on a deal to come over to the blue pig to get screwed some more before being let go as skills garbage. This is a real problem, because the pricing on an outsource is highly sensitive to having at least a good percentage of the outsourced client environment skilled personnel coming over to the blue pig as continuing slave labor for a little while during the transition part of the outsource contract.

    The problem appears to be that the blue pig doesn't seem to be able to prove convincingly that the majority of those folk that come over during transition get new careers in the pig and are happy to have been outsourced!

  • "More chickens coming home to roost" by "Frank_Reality". Full excerpt: Not only is SO not retaining acquired personnel, SO is seeing voluntary attrition of legacy employees in some locations where other opportunities abound. SO is also experiencing clients specifying in their contracts that offshore labor NOT be used. Seems they dislike paying a premium price for abysmal quality and productivity. SO is also facing continued failures to meet contracted service levels and the millions of dollars in penalties IBM has had to pay. Not much to be happy about in SO.
  • "Cheapskates" by "phooey69". Excerpts: According to the Merriam-Webster dictionary, the word "cheapskate" is defined as: "A miserly or stingy person, especially one who tries to avoid paying a fair share of costs or expenses."

    It's probably not a surprise to anyone on this forum that SO has run into problems. The "raison d'etre" in SO has always been COST CUTTING. Charge exorbitantly high fees to the clients, yet run the business as cheaply as possible.

    The cost-cutting mentality has infected the entire business. Every day, I deal with managers whose major (probably only) concern is that they don't get stuck with the bill. I'll bet everyone on this forum who works (or has worked) for IBM has dealt with them.

    This mentality has certainly affected customer relations. Employees working for customers don't want to work for IBM, because they know what's coming. The customers also know what's coming, because they bring in lots of lawyers, outsourcing consultants, etc. before signing any deal. The chickens are coming home to roost, indeed.

If you hire good people and treat them well, they will try to do a good job. They will stimulate one another by their vigor and example. They will set a fast pace for themselves. Then if they are well led and occasionally inspired, if they understand what the company is trying to do and know they will share in its sucess, they will contribute in a major way. The customer will get the superior service he is looking for. The result is profit to customers, employees, and to stcckholders. —Thomas J. Watson, Jr., from A Business and Its Beliefs: The Ideas That Helped Build IBM.

This site is designed to allow IBM Employees to communicate and share methods of protecting their rights through the establishment of an IBM Employees Labor Union. Section 8(a)(1) of the National Labor Relations Act states it is a violation for Employers to spy on union gatherings, or pretend to spy. For the purpose of the National Labor Relations Act, notice is given that this site and all of its content, messages, communications, or other content is considered to be a union gathering.