Welcome to IBM Employee News and Links

Quick Links:

Get involved! Insider trading

Previous highlights:

January 03, 2008 December 27, 2008 December 20, 2008 December 13, 2008 December 6, 2008 November 29, 2008 November 22, 2008 November 15, 2008 November 8, 2008 November 1, 2008 October 25, 2008 October 18, 2008 October 11, 2008 October 4, 2008 September 27, 2008 September 20, 2008 September 13, 2008 September 6, 2008 August 30, 2008 August 23, 2008 August 16, 2008 August 9, 2008 August 2, 2008 July 26, 2008 July 19, 2008 July 12, 2008 July 5, 2008 June 28, 2008 June 21, 2008 June 14, 2008 June 7, 2008 May 31, 2008 May 24, 2008 May 17, 2008 May 10, 2008 2008 Stock Meeting April 26, 2008 April 19, 2008 April 12, 2008 April 5, 2008 March 29, 2008 March 22, 2008 March 15, 2008 March 8, 2008 March 1, 2008 February 16, 2008 February 9, 2008 February 2, 2008 January 26, 2008 January 19, 2008 January 12, 2008 January 5, 2008 December 29, 2007 December 22, 2007 December 15, 2007 December 8, 2007 December 1, 2007 November 24, 2007 November 17, 2007 November 10, 2007 November 3, 2007 October 27, 2007 October 20, 2007 October 13, 2007 October 6, 2007 September 29, 2007 September 22, 2007 September 15, 2007 September 8, 2007 September 1, 2007 August 25, 2007 August 18, 2007 August 11, 2007 August 4, 2007 July 28, 2007 July 21, 2007 July 14, 2007 July 7, 2007 June 30, 2007 June 23, 2007 June 16, 2007 June 9, 2007 June 2, 2007 May 26, 2007 May 19, 2007 May 12, 2007 May 5, 2007 2007 Stock Meeting April 21, 2007 April 14, 2007 April 7, 2007 March 31, 2007 March 24, 2007 March 17, 2007 March 10, 2007 March 3, 2007 February 24, 2007 February 17, 2007 February 10, 2007 February 3, 2007 January 27, 2007 January 20, 2007 January 13, 2007 January 6, 2007 December 30, 2006 December 23, 2006 December 16, 2006 December 9, 2006 December 2, 2006 November 25, 2006 November 18, 2006 November 11, 2006 November 4, 2006 October 28, 2006 October 21, 2006 October 14, 2006 October 7, 2006 September 30, 2006 September 23, 2006 September 16, 2006 September 9, 2006 September 2, 2006 August 26, 2006 August 19, 2006 August 12, 2006 August 5, 2006 July 29, 2006 July 22, 2006 July 15, 2006 July 8, 2006 July 1, 2006 June 24, 2006 June 17, 2006 June 10, 2006 June 3, 2006 May 27, 2006 May 20, 2006 May 13, 2006 May 6, 2006 2006 Stock Meeting April 22, 2006 April 15, 2006 April 8, 2006 April 1, 2006 March 25, 2006 March 18, 2006 March 11, 2006 March 4, 2006 February 25, 2006 February 18, 2006 February 11, 2006 February 4, 2006 January 28, 2006 January 21, 2006 January 14, 2006 January 7, 2006 December 31, 2005 December 24, 2005 December 17, 2005 December 10, 2005 December 03, 2005 November 26, 2005 November 19, 2005 November 12, 2005 November 5, 2005 October 29, 2005 October 22, 2005 October 15, 2005 October 8, 2005 October 1, 2005 September 24, 2005 September 17, 2005 September 10, 2005 September 3, 2005 August 27, 2005 August 20, 2005 August 13, 2005 August 6, 2005 July 30, 2005 July 23, 2005 July 16, 2005 July 9, 2005 July 2, 2005 June 25, 2005 June 18, 2005 June 11, 2005 June 4, 2005 May 28, 2005 May 21, 2005 May 14, 2005 May 7, 2005 April 30, 2005 April 23, 2005 April 16, 2005 April 9, 2005 April 2, 2005 March 26, 2005 March 19, 2005 March 12, 2005 March 5, 2005 February 26, 2005 February 19, 2005 February 12, 2005 February 5, 2005 January 29, 2005 January 22, 2005 January 15, 2005 January 8, 2005 January 1, 2005 December 25, 2004 December 18, 2004 December 11, 2004 December 4, 2004 November 27, 2004 November 20, 2004 November 13, 2004 November 6, 2004 October 30, 2004 October 23, 2004 October 16, 2004 October 9, 2004 October 2, 2004 September 25, 2004 September 18, 2004 September 11, 2004 September 4, 2004 August 28, 2004 August 21, 2004 August 14, 2004 August 7, 2004 July 31, 2004 July 24, 2004 July 17, 2004 July 10, 2004 July 3, 2004 June 26, 2004 June 19, 2004 June 5, 2004 May 29, 2004 May 22, 2004 May 15, 2004 May 8, 2004 2004 Stock Meeting April 24, 2004 April 10, 2004 April 3, 2004 March 27, 2004 March 20, 2004 March 13, 2004 March 6, 2004 February 28, 2004 February 21, 2004 February 14, 2004 February 7, 2004 February 1, 2004 January 18, 2004 December 27, 2003 December 20, 2003 December 13, 2003 December 6, 2003 November 29, 2003 November 22, 2003 November 15, 2003 November 8, 2003 November 1, 2003 October 25, 2003 October 18, 2003 October 11, 2003 October 4, 2003 September 27, 2003 September 20, 2003 September 13, 2003 September 6, 2003 August 30, 2003 August 23, 2003 August 16, 2003 August 9, 2003 Pension Lawsuit Win July 26, 2003 July 19, 2003 July 12, 2003 July 5, 2003 June 28, 2003 June 21, 2003 June 14, 2003 June 7, 2003 May 31, 2003 May 24, 2003 May 17, 2003 May 10, 2003 2003 Stock Meeting April 26, 2003 April 19, 2003 April 12, 2003 April 5, 2003 March 29, 2003 March 22, 2003 March 15, 2003 March 8, 2003 March 1, 2003 February 22, 2003 February 15, 2003 February 8, 2003 February 1, 2003 January 25, 2003 January 18, 2003 January 11, 2003 January 4, 2003 December 28, 2002 December 21, 2002 December 14, 2002 December 7, 2002 November 30, 2002 November 23, 2002 November 16, 2002 November 9, 2002 November 2, 2002 October 26, 2002 October 19, 2002 October 12, 2002 October 5, 2002 September 28, 2002 September 21, 2002 September 14, 2002 September 7, 2002 August 31, 2002 August 24, 2002 August 17, 2002 August 10, 2002 August 3, 2002 July 27, 2002 July 20, 2002 July 13, 2002 July 6, 2002 June 29, 2002 June 22, 2002 June 15, 2002 June 8, 2002 June 1, 2002 May 25, 2002 May 18, 2002 May 11, 2002 2002 Stock Meeting April 27, 2002 April 20, 2002 April 13, 2002 April 6, 2002 March 30, 2002 March 23, 2002 March 16, 2002 March 9, 2002 March 2, 2002 February 23, 2002 February 16, 2002 February 9, 2002 February 2, 2002 January 26, 2002 January 19, 2002 January 12, 2002 January 5, 2002 December 29, 2001 December 22, 2001 December 15, 2001 December 8, 2001 December 1, 2001 November 24, 2001 November 17, 2001 November 10, 2001 November 3, 2001 October 27, 2001 October 20, 2001 October 13, 2001 October 6, 2001 September 29, 2001 September 22, 2001 September 15, 2001 September 8, 2001 September 1, 2001 August 25, 2001 August 18, 2001 August 11, 2001 August 4, 2001 July 28, 2001 July 21, 2001 July 14, 2001 July 7, 2001 June 30, 2001 June 23, 2001 June 16, 2001 June 9, 2001 June 2, 2001 May 26, 2001 May 19, 2001 May 12, 2001 May 5, 2001 2001 Stock Meeting April 21, 2001 April 14, 2001 April 7, 2001 March 31, 2001 March 24, 2001 March 17, 2001 March 10, 2001 March 3, 2001 February 24, 2001 February 17, 2001 February 10, 2001 February 3, 2001 January 27, 2001 January 20, 2001 January 13, 2001 January 6, 2001 December 30, 2000 December 23, 2000 December 16, 2000 December 9, 2000 December 2, 2000 November 24, 2000 November 17, 2000 November 10, 2000 November 4, 2000 October 28, 2000 October 21, 2000 October 14, 2000 October 7, 2000 September 30, 2000 September 23, 2000 September 16, 2000 September 9, 2000 September 2, 2000 August 26, 2000 August 19, 2000 August 12, 2000 July 29, 2000 July 22, 2000 July 15, 2000 July 1, 2000 June 24, 2000 June 17, 2000 June 10, 2000 June 3, 2000 May 27, 2000 May 20, 2000 May 13, 2000 May 6, 2000 April, 2000

Highlights—August 2, 2008

• Reuters: IBM to buy France's Ilog for $340 mln. Excerpt: U.S. computer services and software group International Business Machines has agreed to buy French software maker Ilog for 215 million euros ($340 million), the two companies said on Monday. The deal, which was approved by Ilog's board, is part of IBM's strategy to make bolt-on acquisitions of intellectual companies to which it can give scale. "This combination will allow us to dramatically extend our market reach and realise the full potential of all of our technologies while protecting investments of Ilog's customers now and into the future," Ilog Chairman and Chief Executive Pierre Haren said in a statement.
• Albany Times-Union: Does giving big green to Big Blue pay off? States throw money at IBM, but company shifts jobs around the globe. By Christine Young. Excerpts: It was December 2004, and Tulsa, Okla., was abuzz with excitement. IBM, which already employed more than 1,200 in Tulsa, had made a deal with Oklahoma to add another 1,000 jobs by 2009. In return, Big Blue would get $35.2 million in rebates over 10 years. Calling it "great news for Tulsa and for all of Oklahoma," Gov. Brad Henry praised IBM as "a vital and valuable corporate citizen." He said the deal "signifies good things for both IBM and Tulsa." He was only half right.

  Since the 2004 agreement, the Oklahoma Tax Commission has sent Big Blue more than $4.4 million in rebates. Yet state figures show the company's job count is the same today as it was before the deal was signed.

  This raises questions for the state of New York and Albany, where the ink is still drying on an agreement with IBM that will cost taxpayers $140 million for promises of job creation and economic development. ...

  Economic development packages are great for politicians. Jobs are promised, deals are signed, happy headlines are made. But what happens after the hoopla? Since the Oklahoma celebration, there appears to have been no follow-up or oversight by the state. Last week, the marketing director for the Oklahoma Department of Commerce had no idea if IBM had kept its end of the bargain. "I would imagine that they had," Beth Schmidt said. "It's performance based -- if they meet the requirements and add those jobs." Yet a January report from Schmidt's agency shows IBM Tulsa's payroll remains near 1,200, the same as it was before the agreement. And in May, IBM announced 350 Tulsa accounting and finance positions were going to Argentina. ...

  Exuberance over IBM's presence, be it in Oklahoma or New York, is not unusual. In Boulder, Colo., the city doled out a $100,000 tax rebate to IBM on top of state incentives worth $632,000 to get Big Blue to put a "green" data center there. "The city's money was really an indication to IBM corporate that Boulder really cares about having this company here," Frances Draper of the Boulder Economic Council told reporters. "That was an incredibly important part of their decision." This year, IBM has slashed 400 jobs in Boulder. ...

  And the dirty secret is no one wants to take on IBM for fear of losing jobs and hurting the local economy, especially in areas such as Dutchess County, where IBM is such a vital player. "Nobody wants to throw the baby out with the bath water," Dutchess County Legislator Joel Tyner said. And so New York went ahead with a pact with IBM, requiring a hefty donation from taxpayers, announcing it one day before Big Blue's second-quarter profit jumped a dizzying 22 percent to $2.77 billion, defying even Wall Street's expectations. ...

  Mauro recalls in 2000, then-Gov. George Pataki announced New York was bankrolling IBM with $660 million in state and local incentives. In return, the company would invest $2.5 billion in East Fishkill to create the world's most advanced computer chip plant and 1,000 "permanent" jobs. Eight years later, 1,400 people work at the East Fishkill plant. But Mauro wonders why the state suddenly has to pay another $65 million to keep them there. It "seems like double billing, since New York state and local taxpayers already paid an estimated $660 million for those 1,000 jobs," he said. "It would be good to know ... how long IBM was required to maintain those 1,000 jobs." ...

  IBM is the largest private employer in Durham's Research Triangle Park, where 11,000 workers are on its payroll. Last month, the company asked Durham County for $750,000 in up-front incentives to construct a "leadership data center." The project would convert unused warehouse space on IBM's campus into a customer briefing center with support services, creating 10 new jobs. After being told by a local IBM representative that Durham was competing with sites in New York and Colorado for the $362 million project, county commissioners unanimously approved the deal. ...

  Two weeks after Durham commissioners approved the incentives, IBM laid off 30 workers in Durham.

  Editor's note: If you live in an IBM community, consider writing to your local newspaper to suggest that they pick up this article. For example, I just wrote this short memo to the Boulder Daily Camera's business editor: Hello Ms. Wallace, May I suggest you pick up an article from the Associated Press concerning IBM that was published recently in the Albany Times-Union and mentioned IBM Boulder? As there are a large number of current and former IBM employees in the Daily Camera's coverage area, and that the issues discussed in this effort also affect all tax papers in the area, I think it would be of great interest to your readership. (I have been a subscriber of the Daily Camera for over 30 years.) It would be a great article for Business Plus, and would be a nice change from the Camera's usual pro-business coverage. Please see http://timesunion.com/AspStories/story.asp?storyID=706921&category=&BCCode=&newsdate=7/27/2008&TextPage=1

• Money/CNN: IBM Unveils Plans for $360 Million Data Center in North Carolina. Efficiency Breakthroughs and Revolutionary Design for Cloud Computing. Excerpt: IBM will renovate an existing building on its RTP campus in North Carolina to create one of the most technologically advanced and energy efficient data centers in the world. The new data center will be the first in the world to be built with IBM's New Enterprise Data Center design principles. Clients using this center will have unparalleled access to massive internet-scale computing capabilities, while gaining the cost and environmental protection advantages of IBM's industry-leading energy efficiency data center design.
• The Register (United Kingdom): IBM misses memo on economic slowdown during Q2. By Austin Modine. Excerpt: IBM has yet again shrugged off the global economic slowdown with second quarter profits leaping 22 per cent and revenues rising. Although improvements were reported across most operations, IBM's bread-and-butter services division was the star of the show. "I've got to say that this is one of the best quarters I've ever seen," said CFO Mark Loughridge, during the companies quarterly investor conference call.
• The following are selected comments posted by The Register readers in response to the above article:
  • I can't wait for... By Anonymous Coward. ...Mike Rhodin to show his face at the Town Hall meetings. I am so going to be there. I've already anonymously mailed him all these comments. You've got to love the power of the internet.
  • It's all about the options... By Anonymous Coward. Unfortunately, Rhodin couldn't care less what you say (good on you for doing something though). HR and the executive team is fully aware of the internet comments and the general apathy within IBM UK at the moment, but they cannot do a single thing. Why? Because all of this is tied to Palmisano's desire to meet his 2010 goal of $10 - $11 in earnings per share. All the executives are incented via stock options and the behaviour that this is driving is exactly what you would expect in that case. Representation has been made to Palmisano from very senior managers about the "climate", but his attitude is "tough". He will not release any more money for what used to be the salary increase plan. The executives don't have the clout that they think they have, or the balls to do anything as they are all running scared that they will not make their numbers.
  • Other reader comments for the Register's article are available in July 19 and July 26 editions of these highlights.
• Yahoo! IBM Pension and Retirement Issues message board: "Re: Second Choicers--medical" by "ibmaccountant" Full excerpt: Adrian, It was a well known fact that the 2nd choice for employees if lucky to get still made them victims of the medical theft. Based on a departure at age 55, with an average US life span of 70 and an average of 25K in the FHA account and an annual rise in medical costs of 5% the average total loss of benefits amount will most likely be around to be around 300-350K.

  You should go on with your life, but not forget you got robbed to make Gerstner a multimillionaire as well as many other long-time executives who were the source of the problem anyway. Since the retirement fund is now separated and "frozen" from IBM, you may consider giving the IBM brand image the same "frozen" cold shoulder for the rest of your life and encouraging everyone else around you to do the same. Don't stay angry and be vengeful, just accept the fact that IBM is just an amoral multinational company that doesn't have a loyalty record that shows it can be trusted and if you have to do this business with them, don't forget that fact.

  IBM executives are now getting really concerned that the brand is being associated with that of a foreign company. They want to be known as a "global" company, not a company foreign to the US. They want to be perceived for sales purposes as "American" yet not have to show loyalty and financial commitment to America. Unfortunately, any global company pulling its operations from the US to other countries is essentially moving itself to become a non-US brand, a foreign brand.

  IBM may be registered in Armonk, New York, but that's just were a piece of historical paper resides. It's really a company with most of its assets and operations outside of the US. Essentially a foreign company from an accounting point of view.

• Washington Post: White House Predicts $482 Billion Deficit. By Robert Pear and David M. Herszenhorn. Excerpts: The White House predicted Monday that President Bush would leave a record $482 billion deficit to his successor, a sobering turnabout in the nation’s fiscal condition from 2001, when Mr. Bush took office after three consecutive years of budget surpluses.

  The worst may be yet to come. The deficit announced by Jim Nussle, the White House budget director, does not reflect the full cost of military operations in Iraq and Afghanistan, the potential $50 billion cost of another economic stimulus package, or the possibility of steeper losses in tax revenues if individual income or corporate profits decline. The new deficit numbers also do not account for any drains on the national treasury that might result from further declines in the housing market. ...

  Representative John M. Spratt Jr., Democrat of South Carolina and chairman of the House Budget Committee, said the new deficit figures confirmed “the dismal legacy of the Bush administration.” “Under its policies,” Mr. Spratt said, “the largest surpluses in history have been converted into the largest deficits in history.”

  The recently passed housing bill authorizes the Treasury Department to spend virtually unlimited amounts to rescue the nation’s two mortgage finance giants, Fannie Mae and Freddie Mac, should they be at risk of collapse. The Congressional Budget Office estimated the new rescue authority could add a total of $25 billion to the deficit in the next two years.

• Center for American Progress: Robbing Tomorrow to Pay for Today. Economically Squeezed Families Are Turning to Their 401(k)s to Make Ends Meet. By Christian E. Weller, Jeffrey Wenger. Excerpts: Imagine that you or someone in your family who relied on you for financial help were faced with unexpected medical bills that you could not afford with your current income. Luckily, you have managed to save a nest egg for retirement through your 401(k) plan, the most common defined-contribution retirement savings plan in the United States today, and you can simply borrow against that to keep the bill collectors at bay. Since the money is yours, there is no approval. You may borrow up to half of your retirement savings with no penalty so long as you pay it back within 5 years. Even better, the interest rate on these borrowed funds is lower than those on many other loans.

  The bad news, though, is that while the money is out of your retirement account you are not receiving an investment return. You are also paying yourself a below market rate of interest, which means that as a lender to yourself you are not being paid in full. And should you fail to pay the loan back you will have to pay taxes on the monies and pay a 10 percent penalty on top of that. Finally, the interest payments you are paying yourself are helping to grow your retirement savings, but you have paid them in after-tax dollars, and will have to pay taxes on that “gain” again when you retire and receive money from the account. ...

  The data point the way for current trends. As the economy slows, people are losing their jobs, and wage gains are falling behind sharply higher prices for energy, health care, transportation, and food. Families need to find ways to smooth themselves over the current rough patch even more so than in 2004, the endpoint of our analysis of the available data. With other venues to borrow money, particularly home equity lines, closed off due to lower house prices, tighter credit standards, and slower income growth, families are turning increasingly to the easily accessible loans from their 401(k) plans. The data through 2004 is a harbinger of the erosion in retirement security to come as families are economically squeezed from all sides.

• Chicago Tribune: Parking 401(k) at old job could be best way to go. By Janet Kidd Stewart. Excerpts: Leaving an employer and planning to take retirement savings with you? In some cases, your money doesn't need to move on as badly as you do. A 35-year-old worker who leaves savings with a former employer instead of rolling it into an individual retirement account that charges 30 basis points more in fees resulted in a balance that was roughly 10 percent higher by age 70, according to a statement this month from Hewitt Associates prepared for the Senate Special Committee on Aging. That's the difference between a $366,424 balance and $404,105, according to Lincolnshire-based Hewitt, a large provider of employer-retirement-plan services. (The example assumed a starting balance of $33,000 and average annual returns of 8 percent before fees.)

  "In our opinion, 401(k) plan participants are at far greater risk of falling short in their retirement savings if they roll over their plan balances to a retail IRA compared to a mid- to large-sized company 401(k) plan," the Hewitt statement said.

• US News & World Report: Rethinking 401(k) Rollovers. 7 things to consider before you move your nest egg into an IRA. By Emily Brandon. Excerpt: Conventional retirement wisdom tells us that when you leave a job, you should roll over your 401(k) to an IRA. Rollovers allow you to continue delaying taxes on your nest egg as it accumulates and avoid an early-withdrawal penalty. But if you have an especially good 401(k) with your old company, it may be better to leave your retirement money there or roll it over into your new company's 401(k).
• Wall Street Journal: Gender Split on Retirement Worries. By Andrea Coombes. Excerpts: The complexity of preparing financially for retirement can make anyone nervous -- but a new survey finds women are more worried than men about the challenges ahead, particularly inflation, health-care costs and outliving retirement savings. Eighty-three percent of women surveyed are very or somewhat concerned about how inflation will affect their ability to pay expenses in retirement, compared with 69% of men, according to the survey of about 1,200 pre-retirees and retirees, ages 45 through 74, all of whom had some retirement savings.

  Eighty-seven percent of women are worried about the rising cost of health care, versus 77% of men, and 64% of women are concerned about outliving their retirement assets, compared with 46% of men, according to the survey by Hartford Financial Services Group, an insurance and financial-services company, and MIT's AgeLab, a research group focused on the older population.

• New York Times: Working Long Hours, and Paying a Price. By Kelley Holland. Excerpts: Officially, the average workweek has changed little in the last two decades. But those figures mask a shift in who works the most. In 1983, the lowest-paid workers were more likely to work long hours, according to the National Bureau of Economic Research. But by 2002, the most highly paid workers were twice as likely to work long hours as the lowest paid. ...

  Still, long days at work take a serious toll. For starters, it is very hard for employees to maintain a healthy lifestyle when work and commuting consume 60 or more hours a week. It is probably not a coincidence that obesity has become more prevalent as work hours have expanded for some. Too many hours at the office can also wind up being counterproductive. Employees who are overtired or preoccupied with neglected personal issues are unlikely to perform at their peak. They fall behind, spend more unproductive time at work to catch up, and so on. It is in managers’ interests to help employees find ways to get more done in less time, and some are trying.

• CNN/Money: IBM Accelerates Investments in Emerging Markets. Opens New Centers of Excellence in China, Mexico and India. Excerpt: IBM's focus on emerging markets -- or countries with high economic growth potential -- has accelerated. These countries represented 18 percent of IBM's geographic revenue in the second quarter of 2008, and together grew 21 percent as reported. In addition, the Brazil, Russia, India and China subset grew 31 percent in the second quarter and were led by explosive growth in India. "These results demonstrate that IBM has the ability to thrive in emerging markets," said Bruno Di Leo, IBM general manager, Growth Markets. "Our continued investments give IBM a competitive edge; global reach and scale; and services and products that deliver genuine value to clients wherever they do business.
• Pensions & Investments: Boeing seeks to close DB plan to union employees. Closure announcement could come this week. By Barry B. Burr. Excerpts: Boeing Co. will propose dropping its defined benefit plan for new employees in contract negotiations with its two biggest unions, said spokesman Tim Healy. The Chicago-based company plans to disclose this week details of its proposed defined contribution plan for new employees represented by the International Association of Machinists and Aerospace Workers and the Society of Professional Engineering Employees in Aerospace. The proposal will become part of contract talks between Boeing and the unions. (See Boeing labor talks may include DC plan, PIOnline, April 18.)

  “The retirement benefits of employees have escalated rapidly in recent negotiations, at an average annual rate of over 7% since 1999, a rate far exceeding the rate of inflation,” according to a Boeing statement about the contract negotiations. “While we are willing to discuss increases in retirement benefits, this rate of increase cannot be sustained.” ...

  Boeing also plans to propose ending its retiree medical plan for new IAM- and SPEEA- represented employees, placing them into a new “plan that enables future employees to save for long-term medical expenses on a tax-advantaged basis.” The proposed changes wouldn’t affect defined benefit and retiree medical programs for existing IAM and SPEEA employees. ...

  In June, Boeing announced it will close its defined benefit plan to non-union employees hired after Dec. 31, putting them in a new non-union defined contribution plan. (See Boeing to close non-union DB plan, P&I Daily, June 25.) Also, in the last several years Boeing has closed its defined benefit plan to new employees represented by four small IAM locals that negotiate separately from the main IAM contract, moving them into a new DC plan. Mr. Healy said. These changes have affected fewer than 100 employees, he added.

  Both the IAM and SPEEA oppose ending defined benefit plan coverage for new employees represented by the unions, officials from the two unions said July 29 at a teleconference they hosted. ...

  Stanley Sorscher, SPEEA legislative director, said in an interview that closing the DB plan is “just a bad deal. It’s a poor replacement in dollars and cents for the defined benefit plan. ... It shifts risks to employees. … Success in the aerospace industry depends on a capable work force. The message of a 401(k) plan is its portability. You are daring people to leave early in their careers. Traditional defined benefit and retiree health-care plans are rewards for a long-term career. Boeing is telling aerospace employees, ‘you don’t have a long-term career at the company.’ An experienced, capable and effective work force matters for the (aerospace) industry.”

  At the teleconference, Mr. Sorscher said, “The Boeing pension plan … is considerably overfunded. So we don’t see this (need for curtailing the plan) as an urgent cost issue.”

  Connie Kelliher, IAM spokeswoman, cited a union statement that said, “One look at the recent activity in the stock market is proof of why you need to have a guaranteed benefit at retirement. … If Boeing wants to eliminate pension for new hires, you can only imagine what they have in store for current employees and existing retirees. Pension remains a top concern and one that must be addressed in this contract.”

  Editor's note: How nice it would have been if IBM employees had been represented by a union at the time IBM screwed us out of our pension and retiree medical benefits.

• Fortune: Corporate directors harder to find than ever. “Board searches are harder than ever. Ever!” The king of the Fortune 500 CEO headhunters, Tom Neff, said so over breakfast Wednesday morning at the Core Club in Manhattan. Neff is U.S. chairman of Spencer Stuart, the firm that dominates the market for U.S. board searches. Spencer Stuart has recruited directors for giants like Wal-Mart, IBM, AIG, and General Motors. In his spare time, Neff has conducted CEO searches at Merrill Lynch, Sprint Nextel, and Boeing.

  “More and more board candidates are saying that it’s just not worth it,” Neff says about the challenge of recruiting star executives for corporate boards. Since Sarbanes-Oxley became law in 2002, a typical corporate director’s time commitment has risen sharply. “I’d say by 50%,” he estimates, to about 200 hours a year. And for a troubled company (that’s most companies these days!), reputation can be a major turnoff. “Who wants to have their picture, along with a dozen other directors, in a New York Times story about a company in trouble?” Neff asks.

  Moreover, compensation often doesn’t make up for the hassle. After Sarbanes-Oxley was enacted, director pay increased some 15% annually, Neff says. It’s still rising, but at a much lower rate. Today a directors at the top tier of Fortune 500 companies typically pocket about $200,000 a year.

  Editor's note: It's easy to understand why it's so tough to recruit corporate directors. Only $1,000 an hour? How can anyone live on that?

• Wall Street Journal: Wal-Mart Warns of Democratic Win. By Ann Zimmerman and Kris Maher. Excerpts: Wal-Mart Stores Inc. is mobilizing its store managers and department supervisors around the country to warn that if Democrats win power in November, they'll likely change federal law to make it easier for workers to unionize companies -- including Wal-Mart. In recent weeks, thousands of Wal-Mart store managers and department heads have been summoned to mandatory meetings at which the retailer stresses the downside for workers if stores were to be unionized.

  According to about a dozen Wal-Mart employees who attended such meetings in seven states, Wal-Mart executives claim that employees at unionized stores would have to pay hefty union dues while getting nothing in return, and may have to go on strike without compensation. Also, unionization could mean fewer jobs as labor costs rise.

  The Wal-Mart human-resources managers who run the meetings don't specifically tell attendees how to vote in November's election, but make it clear that voting for Democratic presidential hopeful Sen. Barack Obama would be tantamount to inviting unions in, according to Wal-Mart employees who attended gatherings in Maryland, Missouri and other states. "The meeting leader said, 'I am not telling you how to vote, but if the Democrats win, this bill will pass and you won't have a vote on whether you want a union,'" said a Wal-Mart customer-service supervisor from Missouri. "I am not a stupid person. They were telling me how to vote," she said. ...

  Wal-Mart is a powerful ally. Through almost all of its 48-year history, Wal-Mart has fought hard to keep unions out of its stores, flying in labor-relations rapid-response teams from its Bentonville, Ark., headquarters to any location where union activity was building. The United Food and Commercial Workers was successful in organizing only one group of Wal-Mart workers -- a small number of butchers in East Texas in early 2000. Several weeks later, the company phased out butchers in all of its stores and began stocking prepackaged meat. When a store in Canada voted to unionize several years ago, the company closed the store, saying it had been unprofitable for years.

• Forbes: House discusses Delta-Northwest merger impact. By Harry R. Weber. Excerpts: Officials of unions that represent Northwest Airlines Corp. flight attendants, ramp workers and reservation agents told lawmakers Wednesday they are worried Delta Air Lines Inc.'s plan to combine the two carriers could lead to lost pension benefits for employees. During a hearing in Washington before a U.S. House of Representatives subcommittee, the officials said they have not received assurances that certain Northwest pension benefits would be protected if Delta's buyout of Northwest is completed.

  "If this merger continues and is consummated, they will surely lose benefits going forward," Robert Roach, general vice president of the International Association of Machinists, told the Health, Employment, Labor, and Pensions subcommittee, referring to Northwest workers his union represents.

  He said he believes Delta management will "fight us very hard" and he argued that the combined airline should not be allowed to "dump their garbage" on the government's pension insurer if Delta were to seek to terminate pension plans. "I clearly know the value of a defined benefit pension plan," Roach testified during the hearing, which was broadcast on the Internet. He said he is a former TWA employee whose pension was frozen and later terminated.