But when she learned about drastic changes in IBM's pension plan, she lost faith in the company. She went to Washington to make her case and, to her surprise, developed a belief in the power of the American political system to help ordinary Americans. At the age of 49, Janet left IBM. She is now working as a lawyer.
Editor's note: This interview with my hero, Janet Krueger, is a "must listen to" broadcast. In it, Janet talks about the love she had for IBM, her father's IBM history, the pension rip off of IBM employees, Janet's association with Senator Wellstone, her trips to Washington, and her new career as a public defender. Even if you've faithfully followed these highlights and the Yahoo! forums since the pension and retiree medical theft in 2000, you'll gain new insight into what went on by listening to the broadcast.
If the broadcast is no longer available on the American Public Media link above, you may download or listen to the MP3 file hosted on www.ibmemployee.com.
I took the liberty of digging up a related article on the duke site that appeared in Plan Sponsor several years ago SOME OF THE NEWBIES MIGHT FIND IT WORTHWHILE http://www.dukeemployees.com/madashell.html
It also showed that IBM wanted to close and dust 2nd QTR first before announcing gloomy raise news to the resources. But gloomy news should have been foreseen already once the I/T Specialists and System Admins in 06A got clobbered with a -15% base pay cut. One could only conclude that the raises would stink since the same IBM comment on it "...we (IBM) have to do this pay remix to remain competitive..." also actually applies to these recent raises as well.
IBM says they pay based on performance but how come some PBC "1" performers got no raise? How come PBC "2+" in skilled areas got little or also no raise? And how come no MBA's for skill groups that have many well below their market base reference midpoint pay for PBC "2+" appraisals for many, many, consecutive years?
2007 was supposedly a banner year for profits and revenues in IBM. The executives did well and judging from their insider trades are still doing quite well for themselves.
So all those profits went to stock buybacks for the executives to enjoy and none was put into the raise buckets for employees. So even if IBM has a bad QTR going forward the rainy day for the executive is but a drizzle and not a drencher like it will be for the IBM resource (we used to be called an employee).
So what is next in 2009? Either no raises at all, less bonus pay if any at all, or more folks being added to the 7600 pay cut folks?
I say we do our best now to work toward getting IBM to the table with a collective bargaining agreement since we have to hold them to a written contract since they don't make any positive promises to us anymore and whatever ones they made in the past they seem free to break. If IBM had a great 2007 then our raises should reflect it with at least an average raise at the rate of inflation!!! If 2008 is also stellar then we should also see better raises as well.
It is a well known fact that hedge fund managers who make hundreds of millions of dollars pay federal taxes at a 15% rate. It is also a well known fact that a single working poor person with a taxable income above $7,551 pays federal taxes at a 15% rate plus FICA and Medicare taxes at a rate at a 6.2% rate (earned income is taxed at this rate up to $97,500) for a total federal tax load of 21.2%. Hedge fund managers play the role of witch doctors in my opinion and none of them would beat a well diversified portfolio of index funds over the long haul. They represent the rich man's folly in my opinion. This is an obscene tax loophole!
It is also true that a wealthy person that inherited all of their wealth and never contributed a day's work to society is taxed at a 15% rate on dividends and capital gains.
Since 1980, government tax and industrial policy has resulted in more and more concentration of wealth in the hands of the wealthiest while the middle class has lost income and wealth in real terms during the same period. I am a beneficiary of some of those policies having taking full advantage of my 401K and IRA opportunities while I was working. Because of that, since I am now retired, I am in a fairly comfortable position unless Social Security and Medicare are dismantled and my companies defined benefit pension is stolen.
In 1980 the maximum income tax rate was 70% for a married couple making more than $117,504 in taxable income. In 2007 the maximum income tax rate was 35% for a married couple making more than $336,551 in taxable income. I thought taxes were too high then since I was married and in a 43% tax bracket while making a little over $35,200 of taxable income.
I believe the Bush tax cuts and the Iraq war are the primary reasons for the huge budget deficits. I personally am willing to pay for a government that works. If we want a war we should pay for it and people making $336,551 or even $1,000,000 a year in taxable income can certainly afford to pay more than 35%! They have a bigger stake in protecting their accumulated capital! I have also not noticed that having more money has necessarily made anyone more altruistic, generous, or a better citizen (Enron executives, Global Crossing executives, Adelphia executives, many corporate executives stealing employee's pension funds, many corporate executives stealing corporate funds, etc.).
I don't believe the wealthy are necessarily creating jobs and redistributing wealth in the United States anymore. They are just as apt to invest in sending jobs overseas, moving money overseas, increasing their own compensation (interlocking boards of directors with minimal owner oversight today), and minimizing their responsibilities and promises to shareholders, employees, retirees, and vendors.
In 1980 a CEO earned on average 42 times the average worker's salary. In 2004 CEOs earned an average of 431 times the average worker's salary. In Europe and Asia CEO salaries are on the order of 11 or 12 times workers salaries. These salaries hold up even when the business results are poor. I believe the stockholders, the employee, and everybody but management is being taken for a bath!
An invitation was received at home. I did the RSVP thing and actually was looking forward to seeing some guys I hadn't seen in probably 20 years. First, it seems the whole event was put on by the IBM credit Union. All the greeters, etc, etc were credit union people. And it should be said before I go on, they did a fine job of making us feel welcome.
The point I want to make is that the IBM Company expended nothing, zip, zero, zilch as far as I could tell to make it seem like this was an event sanctioned, supported by the management of IBM. The first speaker was Shed Hamilton, who is now the Area Manager or some such title. What an absolutely awful speaker. Some woman, her name escapes me was next up and gave what was really a pep rally for IBM going forward. When anyone had the gall to ask a retiree oriented question, the answer was "I don't know".
I've had the opinion for decades, including the last few years I was there that IBM management is nothing but a bunch of self aggrandizing wind-bags, and it was confirmed n-fold yesterday.
When I retired, I joked with my friends that as long as IBM sent me my hush-money every month, I'd do as the definition of hush-money would imply, bite my tongue and smile. Not anymore. This company sucks like nothing I would have ever imagined.
If a car at the mall is right at the door and taking up 2 spots, it's probably an IBM Manager. If a guy owns/drives a Hummer and a BMW and has a credit score of 500, it's probably an IBM manager. If a guy races up the breakdown lane on the interstate to get ahead of traffic, it'll be an IBM Manager. If a guy is a greasy money-grubbing CEO, he's ... If I guy is dumber than a fence post, it will be Randy.
And speaking of your "if a guy..." quotes - I once was listening to a an IBM Vice President at a table with several customers. He was complaining about having to buy another new Mercedes Benz M-class for one of his children - his family already owned 4 of them. He also was whining about the cost of sending one of his kids to a private school at $30K+ per semester. I am not making this up.
I hope the customers were as disgusted as I. My kids drove beat-up, high mileage cars, not new MBs. My kids went to state schools because private schools weren't possible given my financial state. We don't live in a fancy new large home. Yet my kids are both hard working and happy - both know we did our best for them.
This exec's whining about his wealth, his privilege and his assets not being enough was arrogant but at the same time, was most pitiful. This is a glimpse of what the executive class is like within IBM. No wonder the company has a leadership vacuum.
For me, it's the personal things that made/make IBM so good to work for - like the secretary with a Poetry degree - that made a super career in system software support - or the typewriter tech who went on to be a Senior Project Manager.
I think it's what you made/make of it. If you wouldn't work on your own advancement, wouldn't move for an opportunity, saw your work as just a J O B - then that's too bad.
But since 1999 it has been abysmal and going downhill every quarter - every quarter there are more layoffs regardless of the amount of work to do. Every year the salary plans are funded with less, every year benefits are cut back. Every year bonuses get cut. Good employees are going many years without a raise and when you get a raise, it's a piddling 1-2% even for a 1 appraisal. Everyone (except execs) are losing ground vs. inflation and have been since 1999. Exempts are brutally overloaded due to excessive resource cuts.
Respect for the individual is dead - killed off by greedy money pinching executives whose sole goal is to pump up the stock price for the short term while cannibalizing the company's future prospects.
It used to be when you worked there that employees were valued. The company invested in you and trained you. Management would reward you for extra effort and high performance There was the unwritten contract that the company would treat you well if you performed well. That gentlemen's agreement is also long gone.
Employees are now treated like fungible commodities - to be dumped like garbage whenever the company execs want a quick cost reduction to pump the stock up. To be bought and sold like slaves. To be dumped without reason. To work hundreds of hours of unpaid overtime and get nothing but a scowl from your wife.
Loyalty of the employee to the company is demanded, yet the company gives none in return. Quality and productivity are no longer rewarded or even valued - all that matters now is cost cutting. When is the last time you saw IBM on the 100 Best Companies to Work list. If there was a list of 100 worst, that's where IBM would be. Count you blessing you got out before all hell broke loose.
My fellow Americans: We are a country in debt and in decline — not terminal, not irreversible, but in decline. Our political system seems incapable of producing long-range answers to big problems or big opportunities. We are the ones who need a better-functioning democracy — more than the Iraqis and Afghans. We are the ones in need of nation-building. It is our political system that is not working. ...
I continue to be appalled at the gap between what is clearly going to be the next great global industry — renewable energy and clean power — and the inability of Congress and the administration to put in place the bold policies we need to ensure that America leads that industry. “America and its political leaders, after two decades of failing to come together to solve big problems, seem to have lost faith in their ability to do so,” Wall Street Journal columnist Gerald Seib noted last week. “A political system that expects failure doesn’t try very hard to produce anything else.”
The memo says employees' individual, lump sum payouts under the pension plan will be reduced by approximately 5 percent to 6 percent in 2009 and approximately 15 percent by 2012. Workers also will make a bigger contribution to their health insurance plan, rising from approximately 21 percent today to 25 percent of the cost beginning in 2009. ...
The maker of Budweiser and Bud Light also said it is increasing its 2008 share repurchase plan to $3 billion from $2 billion and plans for $4 billion in repurchases in 2009. Anheuser-Busch will take a $300 million to $400 million charge related to the retirement plan in the fourth quarter. The plan has the potential to raise Anheuser-Busch's value to $66 or more a share, but that doesn't mean shareholders will go for the deal, said Stifel, Nicolaus and Co. analysts Mark Swartzberg and Mark Astrachan. That's because InBev is ready to pay $65 a share in cash immediately.
A new survey out this week from AeA, the group formerly known as the American Electronics Assn., reports that jobs in the technology industry are growing at a healthy clip, especially in large cities. The organization's Cybercities 2008 survey says that 51 cities added high-technology jobs in 2006, the most recent year for which data were available. The survey tracks new jobs related to the creation of tech products, including fields such as chip manufacturing and software engineering. It is the AeA's first such survey since 2000, which was taken before the crash of the tech bubble that created so many jobs in the late 1990s. ...
The highest concentration of technology workers—286 for every 1,000 workers—was in, no surprise, Silicon Valley. Boulder, Colo., came in second, with 230, and Huntsville, Ala.; Durham, N.C.; and Washington rounded out the top five in density.
Now for the answer to the question on everyone's mind: Where are the highest salaries? That would be Silicon Valley, where the average tech worker is paid $144,000 a year. That's nearly double the $80,000 national average for tech jobs. Runners up included San Francisco and Oakland, Calif. Austin, Tex., home of Dell came in fourth, and Seattle was fifth. San Juan, Puerto Rico, had the lowest salaries, with an average of $38,000 a year, but living expenses there are also considerably lower.
"You make a difference in the corporate world, but it's measured by dollars and by sales," said Giesey, 44, of Crystal Lake. He's not alone in his thinking, jobs experts say. As the nation's economy continues to suffer, schools, villages and other areas of the public sector are being viewed as good places to work with traditional pensions and lower-cost health-care benefits making up for what can be reduced annual salaries.
As expected, people who have no health insurance — there are some 47 million of them — were most likely to make that difficult choice. But insured people also chose to go without care in ever-larger numbers.
According to the survey, the main reason is soaring medical costs, which have outstripped the modest growth in wages in recent years. High costs are deterring not only the uninsured from seeking care, but also many insured people who are struggling with higher deductibles, co-payments and other out-of-pocket expenses as their employers or health plans shift more of the cost burden to them.
Many patients with insurance said they went without care because their health plans would not pay for the treatment or their doctors or hospitals would not accept their insurance. Both insured and uninsured patients said they skipped treatments because they had trouble getting timely appointments, were unable to get through on the telephone, or could not make it to a doctor’s office or clinic when it was open. No doubt a weakening economy, high fuel prices, the home foreclosure crisis and general economic anxiety also played a role. ...
Champions of so-called “consumer-directed health care” might argue that the market is working — people are wisely delaying or forgoing care of low marginal value. But it is disturbing that unmet medical needs increased the most for people in poor or only fair health — those most likely to get even sicker if they don’t get treatment.
German health benefits are very generous. And there's usually little or no wait to get elective surgery or diagnostic tests, such as MRIs. It's one of the world's best health care systems, visible in little ways that most Germans take for granted. ...
The health care system that took such good care of Sabina is not funded by government taxes. But it is compulsory. All German workers pay about 8 percent of their gross income to a nonprofit insurance company called a sickness fund. Their employers pay about the same amount. Workers can choose among 240 sickness funds.
Basing premiums on a percentage-of-salary means that the less people make, the less they have to pay. The more money they make, the more they pay. This principle is at the heart of the system. Germans call it "solidarity." The idea is that everybody's in it together, and nobody should be without health insurance. "If I don't make a lot of money, I don't have to pay a lot of money for health insurance," Sabina says. "But I have the same access to health care that someone who makes more money has." ...
Actually, it's about the same proportion of income that American workers pay, on average, if they get their health insurance through their job. The big difference is that U.S. employers pay far more, on average, than German employers do — 18 percent of each employee's gross income versus around 8 percent in Germany. ...
Moreover, German health insurance has more generous benefits than U.S. policies cover. There are never any deductibles, for instance, before coverage kicks in. And all Germans get the same coverage. For instance, the Casagrandes' insurance covers an expensive medicine Jan needs for a chronic intestinal problem. He says if they moved to America, they might not be able to buy insurance at all because of their pre-existing conditions — a nonproblem in Germany.
"He says for himself — or for us — the health care system in the United States is the major reason why we have never moved there, and never will move there. Because both of us have chronic illnesses that have to have a lot of medical attention, and we would go broke," Sabina says, translating for Jan. Jan adds something else. "It's also the No. 1 reason in the United States that people personally go bankrupt," Sabina translates, "which would never happen here ... never!" ...
Germans really hate any hint of unfairness in health care. The fundamental idea is that everybody must be covered and, preferably, everybody should get equal treatment. So the fact that 10 percent or so can buy some perks is an irritant — something Germans complain about but manage to put up with. But it's unthinkable that 48 million people wouldn't have health insurance at all — the situation in America. As an American, Chris thinks that's shameful. "It's terrible," he says. "It's unbelievable. It shouldn't happen." Germans, he says, would never tolerate that. And their system has been working pretty well for 125 years.
The latest sign is a poll published recently in the Annals of Health Research showing that 59 percent of U.S. doctors support a “single payer” plan that essentially eliminates the central role of private insurers. Most industrial societies — including nations as diverse as Taiwan, France, and Canada — have adopted universal health systems that provide health care to all citizens and permit them free choice of their doctors and hospitals. These plans are typically funded by a mix of general tax revenues and payroll taxes, and essential health-care is administered by nonprofit government agencies rather than private insurers.
Lawyers involved in the backlogged disputes say DOJ "cannot keep pace with the surge in charges brought by whistle-blowers," the Post reports. Since 2001, 300 to 400 civil cases have been filed each year; however, the 75-lawyer unit that reviews the allegations investigates about 100 cases annually. Whistle-blowers routinely wait 14 or more months to find out whether DOJ will get involved in the case, during which time whistle-blowers are not allowed to discuss or disclose the existence of such disputes. The government rejects about three-quarters of the cases it receives, saying the majority lack merit.
Some of largest the false-claims cases include a $650 million settlement reached this year with Merck in connection with an alleged failure to repay Medicaid rebates and a $515 million deal with Bristol-Myers Squibb to cover illegal drug pricing and marketing. The Post reports, "Even bigger lawsuits containing potentially explosive allegations are waiting in the wings."
For two weeks, you don't notice a difference. But then suddenly you can't sleep and you're suffering from headaches. So you call your doctor, who tells you to stop taking the meds and come in to discuss your condition further. In the meantime, you get an unusual mailer from Walgreens, your local pharmacy, saying "please remember to take your medication." Perplexed, you wonder if your pharmacist knows something your doctor doesn't, and you consider resuming the Paxil. Then you take another look at the mailer.
In fine print, you see that the message wasn't sent by Walgreens, but by a company called Adheris. Since you've never heard of Adheris, you call your pharmacist for an explanation. The pharmacist tells you that Walgreens has been selling your prescription information to outside companies, which are contracted to send you these "reminders."
The bill would protect doctors from a 10 percent cut in their reimbursement rates, and it would give them a tiny increase next year. It would also spend more money to enhance preventive services, improve low-income assistance programs and make other modest but worthwhile changes. The bill would largely and sensibly offset the additional costs by reducing payments to the private plans that participate in Medicare.
That has inflamed opposition from the White House and Senate Republicans who seem determined to protect inefficient private plans from the rigors of competing fairly against traditional Medicare coverage. Medicare pays these private plans, known as Medicare Advantage, an average of 13 percent more to provide the same services as the traditional Medicare program.
So, on the heels of our 15% pay cut and gas at $4.25/gallon, IBM decides that everyone has to drive to the office every day. Fishkill is 20 miles south of Poughkeepsie, so an employee who lived north of Poughkeepsie is now commuting an extra 40 miles/day, five days a week. There is no mileage allowance...your office has been moved to Fishkill. Period.
They played hardball here. Any employee who lived within 50 miles of Fishkill was given two choices: either you go to Fishkill, or you have 30 days to find something else within IBM. If you don't find anything within 30 days, you resign. No severance, no nothing. The ONLY exception was for employees who lived more than 50 miles from Fishkill. They were given an opportunity to opt out, with a guarantee that IBM would find them another position.
I don't know what the reasoning would be behind requiring everyone to come to the office...I thought it was cheaper for IBM when employees work from home. But it may just be another ploy to entice people to quit. Sooner or later, they'll make our lives miserable enough that we'll quit and save them the trouble of laying us off. -Sinking Ship-
Alliance Reply: The dichotomy of salaries and wages has always existed within IBM. The reality of IBM's US workforce is that they are diverse in job classification, salary, and description. The point that Alliance@IBM is trying to make is, that ALL of the IBM employees are affected by IBM's management policies; that offer no recourse for the employees, other than leaving or staying if they are unhappy; or simply fired. With a union contract, the structure of job classification, salary, and description can be changed for the betterment of ALL the union employees. It can be negotiated by the union employees and their representatives. But first; you need to organize and join together for that common goal. There are several companies in the US that already enjoy a contract and a work environment, that they were involved in making. It can be a reality for IBM employees, too.
Demand an answer from your IBM manager! Make your manager earn their pay since they obviously get more for less now in how they regard your compensation growth chances now and going forward. If you manager can give you the frank and honest answer or even ignores you about it then blast firstname.lastname@example.org with your question. .cc the Corporate HR Payroll Compensation Director if you wish as well. Put the pressure on now! So who determines what pay for market is? It can't be the cheap IBM payroll bastards now can it? Join the Alliance. Together we can work towards a collective bargaining agreement and then IBM will have to answer our question(s) on compensation practices! If you do nothing now, expect nothing next year as your raise at best. -Market Based Absurdity-
At IBM, he was basically expected to work 80-hour weeks with no overtime pay, but at the State he was legally forbidden to work over 40 hours, without being explicitly budgeted for overtime. Nevertheless, he said he was making more! I don't want to belittle the work he was doing at the State; he was highly skilled and experienced and had a nice title, but he *was* just basically running the code that he had helped create at IBM. The most important reason for these folks to not go to IBM, though, would be the State pension (and medical) that they will receive. I was shocked a few years ago to find that retired garbage collectors in some cities had better pensions than I did after I retired as a Senior Engineer at IBM! Ah, but who has the better memories of their workplace? Who, indeed??? -alreadyGone-
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:
The dreary truth, though, is that IBM is damn good at rigid central control. Look at the stranglehold that has been placed on spending any money for any purpose whatever. IBM Finance would call this expense control, and to an extent it was, once. Now it is a design for sucking all the oxygen out of the atmosphere. It is now the corporate way ... and it is not just IBM. It is every large multinational corporation, every organization that believes its future growth prospects are not really any more in the US and Europe.
That's one reason why ABC and others keep saying the boutiques are better bets for consultants. The boutiques haven't gone into English-speaking rigor mortis yet.
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