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Highlights—May 16, 2009

  • Wordpress Blog: IBM’s Anti-American Labor Practices. By "barbararaisbeck". Excerpt: Today, on International Workers’ Day, I bring you a story on IBM’s labor practices. The post IBM Outsourcing Thousands of Jobs to India has been one of the most widely read and commented articles on this blog. Understandably, there is a lot of agitation around the issue of outsourcing American jobs. I recently spoke with Alliance@IBM Representative Rick White on what is transpiring at IBM. Following the interview are a series of videos with IBM in the news. The hypocritical comments from IBM CEO Sam Palmisano in the first video, and his audacity to ask for stimulus money, are reprehensible.
  • MC Press Online: IBM Layoffs and Compensation Raise Disturbing Questions About Corporate Ethics. By Chris Smith. Excerpts: The corporation continues to keep layoff numbers secret but is obliged to report that executives received millions in bonuses and extravagant perks. ...

    The secrecy surrounding the layoffs at IBM, which most observers close to the situation have estimated will total about 10,000 in North America this year, is just one of the seeds of discontent the company is sowing in this period of economic downturn. Mind you, people are losing their jobs all over the place, and private companies aren't exactly broadcasting how badly they are being hurt by the recession. One of my friends is watching her human resources and insurance business evaporate because her small-business clients are simply shutting their doors and going belly up.

    The policy of most large companies, however, is to announce layoffs of significant size. It's considered a matter of business and social responsibility and has the effect of easing the psychological blow on the laid-off worker by telling the community that it's not the fault of the workers that they are losing their jobs; it's just that the company is cutting back. By not announcing the layoffs, IBM is making it harder on the people who are losing their jobs. The message is: suck it up, the company is doing fine, you're being laid off because you weren't as good as the workers we chose to keep.

    This message of inadequacy is multiplied onto a national scale. While IBM is laying off workers in North America, it is hiring workers in emerging markets. As of last year, the company had nearly as many workers in Brazil, China, India, and Russia--113,000--as it did in the U.S.

    The most recent IBM layoff of some 5,000 workers has raised the ire of the union-backed Alliance@IBM, which says that IBM is "abandoning the U.S. workforce." Lee Conrad, national coordinator for the group, made that statement upon learning about a patent application IBM had submitted that essentially is for a method to outsource work offshore. "A method for identifying human-resource work content to outsource offshore of an organization," was originally submitted for a patent in January 2006, according to Christine Young, a reporter for the Middletown, New York, Times Herald-Record. The application was withdrawn in October 2007 by IBM, which said that it lacked technical content.

    At the end of last month, however, the existence of a second, similar patent came to light. According to Young, the application, which had been sitting in the Patent Office for some time unbeknownst to the press, was for a "computerized system to help businesses outsource offshore jobs while maximizing government tax breaks." The application apparently referenced weighing such goals as "50 percent of resources in China by 2010," the Times Herald-Record reported. ...

    Meanwhile, grumbling continues among laid-off IBM employees who just learned recently that the man responsible for steering IBM safely through the troubled waters of 2008 received nearly $21 million in compensation for his stewardship. IBM Chairman and CEO Sam Palmisano was rewarded for his efforts with salary--$1.8 million; performance-based bonus--$5.5 million; stock options and awards--$12.2 million; and perks--$1.44 million (including $493,881 for personal use of a company aircraft). The figures were reported as part of the company's filing with the U.S. Securities and Exchange Commission. ...

    There is something ironic and tragic about workers who help build up a company to the pinnacle of success, only to have the current regime of well-heeled executives secretly fire them and stealthily replace them with lower-paid foreign workers. Meanwhile, stockholders and company executives continue to reap far-above-average rewards from the corporation's continued high profits--which all employees took part in producing through hard work and extraordinary dedication.

  • Charlotte News & Observer: Times bring tough choices for families of the elderly. Laid off from IBM, wife has to find less-expensive facility for husband. By Thomas Goldsmith. Excerpts: The recession pushed Walt Kline, an IBM retiree with Alzheimer's disease, out of his latest home Friday. Kline, 74, whose four-year battle with the illness was chronicled by The News & Observer last year, moved from his home at the $4,800-a-month Woodland Terrace assisted-living center into a low-rated Chatham County nursing home. ...

    Peggy Kline had also worked for IBM, but recently lost her job along with thousands of others at the computer giant. Her unemployment, along with the impending expiration of Walt's long-term care insurance, meant the Cary couple could no longer afford the cost of his slot at Woodland Terrace.

    Selected reader comments concerning the above article follow:

    • annonymous wrote on May, 2 7:22 AM: To the contrary - this is not due to economic distress or out of our control. IBM is enjoying record profits, increasing stockholder dividends, and stock price is high. In their own communications with the media - American employees are being laid off for the sole purpose of shipping American jobs overseas. Cheaper labor and, more importantly, our corporate tax policy -- low corporate taxes (5%) on overseas profits are driving this. If tax laws changed, so would corporate behavior and jobs would stay in the United States. Multiply this story by 10,000 - the number of IBM employees laid off since January - and you begin to see what it is doing to American families. Contact your representatives in Congress.
    • Cottonelle wrote on May, 2 9:06 AM: Sam Palmisano, CEO of IBM stated in a recent Fortune magazine article that the company was planning to put millions into marketing efforts. As much advertising as we have today, the CEOs of the advertising companies must be filthy rich too. Is this really needed in lieu of taking care of longtime loyal employees?
    • LearningFast wrote on May, 2 10:35 PM: IBM's strategy on what appears to be age discrimination is interesting. The IBM severance package discloses possible guilt upfront by giving employees the breakouts. The groups hit hardest were over 40. They specifically list all the laws that they think they may have violated. You are then asked to sign the release waiving your right to sue and take the money or not. They advise you to talk to a lawyer before signing. Since most people cannot analyze this information timely and don't understand the law, they sign, game over. Effectively IBM skips the trial and settles for pennies on the dollar with their severance offer.

      If your job moves to China you may get offered the Project Match option. Your job moved and you can too. We think you will like it. Of course the local currency is fish heads.

      While this is an effective way to exterminate employees, do US corporations really need to behave this way to be successful?

    • LearningFast wrote on May, 2 10:50 PM: Refresh my memory. What was IBM's 2008 revenues? $104 Billion. What was IBM's 2008 profits? $12 Billion. How much would an angry jury award to a person who was wrongfully terminated for whatever reason after devoting most of their life to IBM? This type of corporate behavior must be stopped. I am very sorry about Ms. Kline's loss and I admire her courage and strength during this difficult time.
  • BusinessWeek: Why Jobs Go Begging Amid Layoffs. Mismatched skills and picky hiring managers explain why openings persist ahead of the government's latest payroll report. By Peter Coy. Excerpts: So what gives? Why don't employers give jobs to some of those 13 million people who are eager to work? Wouldn't that make everybody happy? Employers don't see it that way. They say that jobless people don't necessarily have the skills they're looking for—especially since the sectors with the most openings (education and health care) are very different from the ones that are losing the most workers, manufacturing and construction. Even within the same industry, employers say, there are people whose skills are outdated or out of sync with what's needed for the jobs that need filling.

    But BusinessWeek was deluged with comments from people, many of them unemployed, who said employers are too picky, want to avoid paying for training, want to export jobs, or would rather hire cheap foreigners on H-1B visas. Here's a typical comment from someone who signed herself Lucy: "I don't believe this article at all; it's hogwash. IBM is not laying off people because of a skills-mismatch problem. They are laying off people because they want to offshore all U.S. jobs to low-wage countries, or bring in more people to the U.S. under the H-1B visa program. They also don't want to train U.S. employees."

  • IBM Pension and Retirement Issues message board: "An inquiry from public radio show Marketplace" by Janet Krueger. Full excerpt: I received the following request from a journalist at National Public Radio. Please respond to him directly if you are interested in talking...
    Hello - I'm a journalist at the public radio program Marketplace. We're trying to get in touch with people who have experienced layoffs to find out how people are staying in touch (or not) with the companies they've left. If you find it appropriate, I'd be grateful if you could post the following request to the ibmpension discussion group.

    Anyone who responds to the inquiry by filling out the form becomes a source for public radio -- our goal is to tap people with insight into news topics to inform our reporting. And it goes without saying that we would love to have more current and former IBM employees in our source network to help us in reporting about technology, pensions, employee benefits and more topics. Many thanks, Joellen Easton.

    The public radio show Marketplace is looking for people who can give us insight into what happens after a layoff. Use this link to talk to the show: http://tinyurl.com/d2nzqd.

    Getting laid off can be an isolating experience in which work-based connections and relationships break down. But some companies, like IBM, Lockheed Martin and Microsoft, are making efforts to stay in touch with laid-off employees through online social networks and other means.

    If you've been laid off, have you kept up relationships with your former employer, or your coworkers? Did you burn bridges, or leave on good terms? And if you are staying in touch via a"corporate alumni community," what's that like? Do you feel it's for your benefit...or the employer's, so they can find you when it's time to start rehiring?

    How have you maintained work connections post-layoff? Talk to Marketplace: http://tinyurl.com/d2nzqd

    Thank you, Joellen Easton Analyst, Public Insight Journalism Blogger, The Trading Floor (http://www.publicradio.org/columns/marketplace/tradingfloor/) Marketplace | American Public Media.

  • HR On Your Desktop: Can't Resist - Lack Of Critical Thinking Again - IBM. Full excerpt: So folks - here's another one for the critical thinking waste basket. From another patent application:
    "A significant source of wasted time is the general predisposition to using integral units of time, based on hour or half hour increments. This is especially true of business meetings, which are invariably scheduled to last an hour. Meeting attendees will fill the full hour for which the meeting is scheduled regardless of whether the entire hour is necessary to address the business at hand. The result of this is that a meeting that could have taken less than an hour will end up wasting time due to the arbitrary hour-based scheduling paradigm."

    I've never attended a meeting in the last 20 years that lasted as long as it was scheduled - it either runs longer or shorter than the scheduled time. And no, they are not typically an hour. If the meeting runs shorter, then we all leave. No one feels obligated, including the person calling the meeting, to use up the extra time. So the assumption: "Meeting attendees will fill the full hour for which the meeting is scheduled ..." is absurd unless your management paradigm is so screwed up within your company that people actually do that. That's a management problem easily solved, not a software design issue that is worthy of a patent. Perhaps the management should adopt the Best Buy corporate meeting philosophy - don't schedule a meeting unless it is absolutely necessary and then don't schedule it. You get a lot more done.

    No wonder Scott Adams doesn't have to work hard... people do it for him every day. Critical thinking - where did you go?

  • Yahoo! IGM Employee Issues message board: "Time Off with one third pay" by "Gary Louis". Full excerpt: Take Time. STG/ISC launch US summer time-off pilot. Take Time Estimators. Visit the Media Library to estimate your salary payments if you 'Take Time.' The tool is available for regular work schedule employees and alternate work schedule employees.

    A new pilot program will allow some IBMers the option to take time off this summer at partial pay. The voluntary program called "Take Time" is open to Systems and Technology Group and Integrated Supply Chain employees in the United States.

    Take Time participants can use the added time in any way they wish – to volunteer in the community, engage in skill development/learning activities or simply spend more time with their family. For instance, Take Time participants could take advantage of IBM's On Demand Community and find volunteer opportunities in their communities.

    While IBM reported favorable first quarter earnings overall, Systems and Technology Group's performance reflected the current challenges facing hardware companies. Take Time offers employees a way to voluntarily participate in a program that provides them additional personal flexibility while providing the business with a potential way to reduce operating expenses.

    How it works: Regular full-time employees can take anywhere from 10 to 20 extra days off (or seven or 14 extra days off for employees working an alternate work schedule) at one-third pay from May 15 through August 31. They are free to structure the time away as they prefer one day a week, all days consecutively, or some variation in between, in full-day increments. Employees who are on IBM sales incentive plans or in client-impact support roles are not eligible to participate.

    The pay deductions will not be taken during the summer when the time away is being used. Instead, the pay deductions will occur in equal increments from the two pay statements in September, giving participating employees time to plan financially for the cash flow changes.

    Benefits coverage, including earned vacation, continues without interruption since employees are considered active and full-time employees while participating in Take Time.

  • Yahoo! IBM Employee Issues message board: "Re: Time Off with one third pay" by "sby_willie". Full excerpt: Why not have the VP's heading ISC and STG take time off this summer for reduced pay as well? Better yet since these VP's are having trouble making their numbers for 3rd QTR maybe they should be RA'ed.
  • Yahoo! IBM Employee Issues message board: "Re: Time Off with one third pay" by "flatsflyer". Full excerpt: Only problem is that the program will put a target on your back for the next round of "RA's". It will not reduce your utilization (target) and if you can afford to be away from your cubicle for more than 3 days your 2nd line management will probably figure your job is not necessary.
  • Yahoo! IBM Employee Issues message board: "Re: Time Off with one third pay" by "ibmretiree2006". Full excerpt: Oh Iggy!!! You think IBM has some ulterior motive? What have they done to make you suspect this is not a good thing? Why, if they can do without you during the summer for a bit, why not year round? OR when things are slow, furlough you. I guess we are both jaded.

    And then there was a comment about "life balance," IBM's fabulous program to "help" the employee. How can you have "life balance" when you are working 6 days a week. I get emails from folks in my time zone at 11PM, 4AM, Saturdays and even Sundays. But heck, as long as the corporation is making profit, who cares? I have a lot of contacts in IBM still and I am seeing really top quality people AFRAID to take vacation time. Working on RFPs on Christmas day and Easter. I am one of the lucky ones but I surely do feel for those poor ba$tard$...

  • Yahoo! IBM Employee Issues message board: "I've been reading your posts and have a question" by "Collen Burger". Full excerpt: Hello, I am newly RA'd IBMer. Been with the company 27 years. Was really hoping to make it to 30 to get the medical coverage but the target on my back was just too big. Always a 1 or 2 (2+ now) performer with all the accolades. IBMretiree...I really appreciate your posts. They are right on and you seem like a very honorable, well rounded human being.

    What got me to post after a lot of reading was your statement: "An analogy is someone suffering domestic abuse but has NO WHERE to go (or believes they have no where to go)" ...that is EXACTLY how I felt and said (to myself of course) many many times. I was SO SCARED. I come from a place where IBM is the ONLY game in town and my parents didn't have enough money to send me to college. The day I got into IBM at a very young age was one of the happiest days of my life (or so I thought). To see what I have seen over 27 years...words cannot express.

    I am hoping that IBMretiree or some of the obviously intelligent gentlemen on this board can help me with a question. I need an answer from an 'insider'. The question is, should I take my pension now or should I wait 5 years when I hit 55? That will be my next opportunity to take it, now or 5 years from now. The reason I am asking you is, do you think with the way IBM is going it will still be there for me in 5 years? I would appreciate very much any help or advice you might have for me on whether you think I should take the money now or wait...I admit I am a very sheltered IBMer. uh... ex-IBMer... THANK YOU... for any help...Seaflea

  • Yahoo! IBM Employee Issues message board: "Re: I've been reading your posts and have a question" by "flatsflyer". Full excerpt: I took the money and ran. I did have 30 years but my account put it very simple, take as much as you can get as early as you can. I worked for 6 years as a consult after retiring but I think the outlook today is some what more challenging. If you don't take it now and you can't find employment in your field, then what will you do? Hate to say it but with the college education you may end up with a lower paying job, with your pension and a lower paying job you probably will be alright. Then when your SS kicks in at 62 with an annual COLA you maybe able to fully retire.
  • Yahoo! IBM Employee Issues message board: "Re: I've been reading your posts and have a question" by "Colleen Burger". Full excerpt: Thank you for your reply flatsflyer. It is interesting to hear what your accountant said. The only 'accountant' I have talked to is the Money-Smart person that IBM is providing to me free of charge (I'm using him because he is FREE)...but he hasn't been especially available or helpful really. I realize I will be making half of what I was making at IBM and that's if I'm LUCKY, with no college education. I am taking advantage of the retraining IBM is offering in the package they gave the RA'd folks, but no matter what I will never make that kind of money again and I know that. I'm actually not sure what 'COLA' is...I have a lot to learn. I will be sure to look into what that is....thanks again for your reply, I appreciate it !! Seaflea
  • Yahoo! IBM Employee Issues message board: "Re: I've been reading your posts and have a question" by "madinpok". Full excerpt: I wouldn't worry too much about the safety of the IBM pension fund. The pension fund is in reasonably good shape today, and is a trust fund that is separate from the rest of IBM's money. Even if IBM were to go bankrupt, that doesn't mean everyone would lose their pensions.

    I think you should focus on the difference in dollar value to you of having the money now vs later and how that fits into your financial situation.

    I think that if you run estimates for your pension amounts for taking it now vs 5 years from now, you will find that it increases very little for each additional year that you wait - probably something in the range of 1 - 2% per year.

    For that small increase, you are probably better off taking it now. Think of it this way. Say your pension will be $10,000 per year if you take it now, and $11,000 per year if you wait 5 years. If you take it now, you will have $50,000 in the bank 5 years from now vs starting off with nothing and getting $11,000 per year going forward. Even allowing for a fairly high income tax rate, if you waited 5 years, it would take you 25 years or more to hit the break even point before waiting would have been the right choice.

    My math here is highly oversimplified. But the pension amounts are based on average life expectancies and the crossover point is usually around 80 years of age. IBM's pension calculations include an early retirement subsidy that results in a more generous pension (in terms of the theoretical lump sum value) the younger you are. So if you want to get the most money out of IBM's pocket, that is another reason to start now instead of waiting.

    You might have an idea about how long you might live based on your family history. But who knows what else might happen in the meantime? Those unknown factors tend to make me think that, if it were me, taking the pension now is a good idea.

    Finally, it is always a good idea to talk to a fee-for-service financial adviser about these decisions. It is an important, once in a lifetime choice and someone who understands your full financial picture can hopefully give you a recommendation that is right for you.

  • Yahoo! IBM Retiree Information Exchange: "Re: Retiree ID Cards" by "ibmretiree2006". Full excerpt: Ah, remember those Family Dinners? The Christmas parties with gifts for the children? the "Fun In The Sun" outings? The IBM club? The Silver Spoons? Sam and his buds get all the money that was spent on those events as boneii!!!
  • Yahoo! IBM Retiree Information Exchange: "Re: Retiree ID Cards" by "lederer2000". Full excerpt: Back in the day was a great time. I remember being so proud to work for IBM. How proud my wife was. My mother would love to tell people that her son "worked for IBM", like I was a doctor of something. I lived on Long Island at the time. there weren't that many IBM'ers around. It's amazing how time changed.
  • Yahoo! IBM Retiree Information Exchange: "Re: Retiree ID Cards" by "ibmretiree2006". Full excerpt: We would have "taken a bullet" for IBM. Now, the bullet COMES from IBM. Yes, we have so many telling us the world has changed and this is a new global economy. What they keep glossing over is the delta we had to, say, TJ Jr is salary and today's IBM Executive world. I am glad I am retired but I rarely tell anyone where I retired from. I won't say I am exactly embarrassed but surely don't feel the pride I had up until a decade or so ago.
  • Yahoo! IBM Retiree Information Exchange: "Re: Family dinners" by "trolly.dodger". Full excerpt: The Family Dinners in Mid-Town Manhattan were really big events. They would pay for your baby sitter so that the spouse could make it. They were "dry." My date almost chocked on a class of pink lemonade; not what she was expecting. Back when the personnel were important and respect for the individual was a two-way street. Think has changed to scheme Bob Coppola
  • Yahoo! IBM Retiree Information Exchange: "Re: Family dinners" by "Lou Copits". Full excerpt: I was in a tech support group and a marketing office. Every few years we would have an excellent dinner, spouse included, white tablecloth type and wine at least once. A high level executive would attend, with Tom Watson once. A very nice fringe benefit.
  • Yahoo! IBM Retiree Information Exchange: "Re: Family dinners-Picnics In Austin" by "lambeththompson". Full excerpt: Was in Austin in Mid 70's-Many good memories of Family Christmas Parties, Family Picnics in 'then IBM Century Oaks Park'. In those days the people we worked with daily were also our family friends! Sadly the IBM property which was the Century Oaks Park has been sold and turned into a shopping center.
  • Yahoo! IBM Retiree Information Exchange: "Re: Retiree ID Cards" by "lederer2000". Full excerpt: We had Family Dinners when I worked in the OP Division on Long Island. This was from 1968 to 1974. I don't remember where they were held, but it was in one of the swankiest places on Long Island. I don't believe they were every year either. I seem to remember every other year. You could put in an expense form for costs of the tip for valet parking and baby sitting costs. Of course no booze, but they did have a "cash bar" on the premises.
  • Yahoo! IBM Retiree Information Exchange: "Re: Retiree ID Cards" by "Paly". Full excerpt: Family dinners were really nice affairs. We had them in New York City at some class hotels when I worked in the branch. I would meet my wife's train in Grand Central and hook up with other couples from the office. That was when IBM was IBM. A branch office was like a family. Before pigs like Gerstner and Palmisano turned it anti family anti employee. SHAME on them.
  • Yahoo! IBM Retiree Information Exchange: "Re: Retiree ID Cards" by "Paly". Full excerpt: That was like a hundred years ago Larry, And BTW only received one out of 5 silver spoons, IBM has turned into a company you would not recognize let alone want to be associated with. The days of family dinners and Christmas parties etc etc were over years ago.

    Those of us not yet Medicare eligible are going through hell trying to insure our wives. Over 900 a month is more than half our pensions or damn near. I am forced to take early SS payments to make ends meet. It is my goal to find my wife outside insurance and then get away from IBM insurance when medicare comes around. I never thought it would be like this when I came aboard over 40 years ago.

  • Yahoo! IBM Retiree Information Exchange: "Re: Family Dinners et al" by "mr_quarkwrench". Full excerpt: And how many from southern California offices remember Disneyland night in Novembers of the late '60s and early '70s. This was a time when Disneyland still had the A thru E tickets but on IBM night all rides were open. I miss the real IBM. -- Don
  • Yahoo! IBM Retiree Information Exchange: "QC Club" by Rod Cordell. Full excerpt: Induction into the Quarter Century was something. You got to pick the restaurant and the guests, I don't remember how many guests. Your guests would be paid by IBM to get there no mater what part of the country they were in. By 1990 that had changed. The lunch, at least in San Jose was moved to the Homestead on the plant site. Still got a Rolex. A couple of years later it went from a Rolex to a Tudor.

    Into the early '80s, at least, they would pay for a lunch, at a restaurant of your choice, for hitting 30 years. You could invite a half a dozen of your buddies. You could even act like grownups and have a drink, or two, all of the attendees had the rest of the day off. Rod Cordell 1965-1995.

  • Yahoo! IBM Retiree Information Exchange: "Re: QC Club" by "drebe102". Full excerpt: I joined in 57 and retired in 87. I hit it at the best of times. Main Frames and IBM were flying high. Family dinners, Golden Circles, 100% Clubs, Rolex Watches, 25 year dinners, and all the rest. My pension plan and medical is still going fine after twenty something years. I have no complaints whatsoever.

    All this discussion about how bad IBM has become and how unfaithful it is to it's employees sort of chaps me. I personally think that the employees changed first. They had no loyalty to their employer. I am not sure but that it was the egg -- not the chicken. America was taken over by the psychology of entitlement -- the "ME" generation.

  • Yahoo! IBM Retiree Information Exchange: "Re: QC Club" by "orsonbear". Full excerpt: Sorry, old timer, but you have been away from IBM too long, 22 years. You did not live through the current history. You forget that in 1993, IBM hired Lou Gerstner, an outside hatchet man, to be the CEO. He subsequently brought in dozens of outsiders, like Randy MacDonald, head of HR (and who is still there).

    Lou and Randy engineered the termination of over 100,000 IBMers. Lou officially discarded the Basic Beliefs and put in place a new list of "core values". "Respect for the Individual" was not on the list. IBM stopped being "IBM" and was now "just another computer company".

    Sure, IBM is amazingly successful, having had its best year ever in 2008. But the culture is gone. It is NOT the employees who did this. Do you ever see IBM making the "best places to work" list? Wonder why not?

  • Yahoo! IBM Retiree Information Exchange: "Re: QC Club" by "madinpok". Full excerpt: Actually, Lou's original hatchet man was Tom "Socks" Bouchard who engineered the vast, initial rounds of layoffs and then the great pension heists in 1995 and 1999. Randy MacDonald didn't arrive until 2000.
  • Yahoo! IBM Retiree Information Exchange: "Re: QC Club" by "bits_bytes_and_bugs". Full excerpt: It may chap you, but the IBM company you worked for from 1957 to 1987 no longer exists. IBM used to be a great company to work for - it used to be one of the best companies to work for. It is no longer. The decline in employer loyalty started shortly after you left.

    I bet you never heard a Senior Vice President tell his reports at a town hall meeting that "if you want loyalty, get a dog".

    I bet you have no idea what it's like to work your ass off, watching solid performing long term co-workers get resource actioned every quarter even though their performance was good and there's plenty of work to do, simply because the executives of the corporation are cutting costs to pump up the short-term stock price. You probably have no idea what it's like to wonder every quarter whether you get to keep your job.

    That is the truth - and it's not the employees that changed first. The change was that employees were once treated like assets - now they are fungible liabilities to be discarded like trash whenever the execs need to cut costs to pump up the stock price.

    It used to be that IBM would invest strategically in plants, people and technology. The executives led the company with a long term focus. That too is gone. All that matters now at IBM (and a lot of other companies) is the short term stock price. The exec team has more focus on managing the short term stock price than it does leading the company.

    You got your pension and retiree medical. Mine was cut in 1991, 1995, 1999 and frozen in 2007. My retiree medical was taken away and replaced with a funny money account that won't last 3 years before it's all used up. Most of my coworkers are worse off than I.

    A lot of very bad things have happened at IBM in the 22 years since you retired, so rather than blame the victims, you may want to listen with compassion.

  • Yahoo! IBM Pension and Retirement Issues message board: "IBM Retiree Health Coverage vs. Government 'Single Payer'" by Thomas Holford. Full excerpt: I currently am signed up for the IBM Medium Deductible PPO. I am not an expert in healthcare plans, but compared to what most other people have, I have to believe I have good coverage. Six years ago, I had a major (and expensive) life-saving medical procedure which was adequately and satisfactorily covered by my (then) IBM healthcare plan.

    Compared to what I have now AND WHAT I EARNED AS A LIFETIME BENEFIT AND PAID FOR AS A PART OF MY IBM EMPLOYMENT COMPENSATION, I believe that any government provided "national healthcare benefit" or "single payer healthcare" system will be vastly inferior to my current healthcare coverage.

    My question is: does my expectation of a lifetime assurance of comprehensive, high quality, available health care represent a contractual obligation and a "property right" which the Obama administration or any other government interlopers are Constitutionally prohibited from interfering with?

    Or, in other words, if the government tries to make me accept some shabby, third-world health care plan and take away my access to arguably superior IBM Retiree health care plans, are there avenues of legal recourse under contract law, property rights ("takings", ex post facto doctrines, or whatever?

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: IBM Retiree Health Coverage vs. Government 'Single Payer'" by Kathi Cooper. Full excerpt: You have no legal right to medical health care from IBM. It is a gift. That is why they call it a benefit. Lots of companies want to drop it. If you want your medical benefits legally protected, you need to work with your Congressional Critters.

    Whenever I go to the hospital, as a patient or a visitor, I've observed they medically treat everyone the same. I'm pretty sure you receive the same superior medical treatment as me and everyone else.

    Regarding your concern of 'third world' medical treatment, what pills have you been popping?

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: IBM Retiree Health Coverage vs. Government 'Single Payer'" by Thomas Holford. Full excerpt: Retiree medical health care from IBM is more than a gift; it was an inducement offered to tens of thousands of people to accept employment with IBM.

    I don't think that IBM and the government can ethically and legally get away with saying that we are going to exchange your proffered inducement of high quality retiree medical health plans with crappy stand-in-line government healthcare plan that doesn't pay for hip replacements because you're over 66 or whatever.

    I have to believe that there are many, many underemployed trial lawyers who could articulately make the case that such a scheme (in the absence of bankruptcy) is at minimum bait and switch and arguably default on an implicit or constructive contract.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: IBM Retiree Health Coverage vs. Government 'Single Payer'" by Kathi Cooper. Full excerpt: IBM can ethically and legally get away with changing your health plans on any day of the week. They have to tell you they are doing it, but that is about it.

    There are around 40 million Americans using single payer health insurance and they get quality hip replacements whenever they need one. It is the same superior hip replacement that you would get either on IBM's plan or on a single payer plan. (And I've never known anyone to wait for one, how silly is that?)

    Bait and switch has nothing to do with it. Contract law has nothing to do with it. Why? Because IBM's health benefits are not legally protected by any law. The truth is sometimes hard to take, but that is the truth.

    Be grateful that IBM provides you with health care. In fact, be grateful that you still work for IBM. If you were RA'd, like tens of thousands just lately, you would be paying up the yin-yang for your premiums, for a while, before they run out, and then you wouldn't have any health benefits at all, unless you are able to get another job at a company that provides it, if they do, which many don't anymore.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: IBM Retiree Health Coverage vs. Government 'Single Payer'" by Kathi Cooper. Full excerpt: Regarding active employees health care (USHR106): "As noted in various company publications, IBM reserves the right, at its discretion, to amend, change or TERMINATE ANY OF ITS BENEFITS PLANS as the company requires."

    Regarding the FHA if you are lucky enough to qualify (USHR117): "IBM reserves the right, at its discretion, to amend, change or terminate any of its benefits plans, programs, practices or policies, as the company requires. Nothing contained in this summary shall be construed as creating an express or implied obligation on the part of IBM to maintain such benefits plans, programs, practices or policies. Your benefits at or after retirement may be different from those described herein due to changes made to the IBM Future Health Account or THE TERMINATION OF THE PLAN."

    (emphasis mine on both quotes from IBM's docs)

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: IBM Retiree Health Coverage vs. Government 'Single Payer'" by Mike Germano. Full excerpt: 1) You'll be able to keep your private plan under the proposed White House changes. You only have to use the Government plan if you have no coverage. You can also choose it instead of your private coverage.

    2) If we don't go to a better model, most of us will not be able to afford health insurance as costs and deductibles continue to rise.

    3) The US is way down on the list for quality medical care and life expectancy compared to other industrialized nations with (gasp!) socialized medicine. The US is number one in what it pays for medical costs, though. Even several non-industrialized nations have much better medial care at much lower costs. What we are doing clearly isn't working very well.

    IMHO, as long as we have a "for-profit" medical system, then we'll never get costs under control. Don't give me the GOP bullsh*t lines about competition lowering prices and private being able to do it cheaper than government because it's had every opportunity to happen for many years and look at the mess we're in. The definition of a fool is someone who keeps doing the exact same thing and expecting a different outcome. It's time to give Government 2.0 a chance.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: IBM Retiree Health Coverage vs. Government 'Single Payer'" by "Courtault." Full excerpt: As Kathi rightly points out, the "expectation" is just that - an expectation. IBM is under no obligation to continue coverage and can raise deductions, caps on payment, etc. as it wishes. IBM can also make qualification more difficult or limit payment to only certain types of conditions. In essence, you are running on pure luck.

    Current healthcare plans dictate the level of treatment one receives. My hospital employee friend can tell you story after story - including the one where a patient complained of severe headaches, was denied diagnostic tests by his insurance company, and died of an aneurysm. So your complaint would seem to be more about who would set those limits (government vs. insurance companies) rather than the existence of such limits.

    As for your "superior IBM Retiree health care plans," you do realize don't you that only a fraction of those retiring from IBM actually get them? As I recall, only those "retirement eligible" at the time of the '99 pension/healthcare disaster get the "old" retirement healthcare coverage. Everyone else get royally screwed and essentially have little to no retirement healthcare coverage from IBM. Your answer to that almost comes across as, "I've got MINE and it's too bad for you."

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: IBM Retiree Health Coverage vs. Government 'Single Payer'" by "flatsflyer". Full excerpt: Your answer to that almost comes across as, "I've got MINE and it's too bad for you."

    I don't think any "older" Retiree feels that way at all. What many of us do feel is that the people who could have cause changes in the way IBM treats employees, retiree's fail to do anything about the continual abuses, takeaways, clawbacks, etc. Those of us who do have the old plan where gone when this happened and the employees at that time and ever since failed to do anything, just laid back and continued to accept whatever IBM dished out. There was not much we could do other than voting our proxies, the active employee's could have done a lot, strike, sick-in's, etc. The least they could have done was to join the union. It's quiet clear now that anything the employee's could have done would have been better than what they got from Three Finger Lou and Slumdog Sam.

    It's possibly too lat now because IBM knows that the 100,000 remaining US employees are short lived and they have their strategy practically fully implemented. You have trained your replacements, you have failed to support your union. IBM management knew that employees would not do anything and therefore went ahead and changed the business model.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: IBM Retiree Health Coverage vs. Government 'Single Payer'" by Linda Albury . Full excerpt: When your Congressman or woman seek medical care, they get the best care available, paid by you the taxpayer. It's certainly not the "third-world" care that someone else had mentioned. It's the care that I as an American citizen and taxpayer would also like to get. Since companies like IBM are dropping healthcare like a hot potato and putting the burden on the so-called retiree, I'll go with the government care just like our Congressmen and women take advantage of now.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: IBM Retiree Health Coverage vs. Government 'Single Payer'" by Nancy Goodenough . Full excerpt: Don't drink the Rush/Republican KoolAid. President Obama is NOT considering Single Payer, much to the chagrin of many of us as it cuts out huge expenses, think IBM when they were totally self-insured.

    Obama wants to develop a plan where you can keep your private insurance and I can choose a public option, if i want. And I want. We pay over $13k per year for two, high-deductible, high co-pay. I'd dearly love to buy into Medicare. The Republicans are fighting that possibility tooth and nail because they say, if a public plan is an option, no one would choose the private plans. Ummmmm. Yeah. And so I shouldn't have the public plan as an option because most would choose it? Give me the choice.

  • U.S. Department of Labor: Can the Retiree Health Benefits Provided By Your Employer Be Cut? (PDF). Excerpt: Providing for health care is an important part of retirement. Some employees are fortunate: they belong to employer-provided health care plans that carry over to retirement. However an important question arises for employees and retirees: How secure are my health care benefits after retirement? Under what circumstances can the company reduce or terminate my health benefits?

    Employees and retirees should know that private-sector employers are not required to promise retiree health benefits. Furthermore, when employers do offer retiree health benefits, nothing in federal law prevents them from cutting or eliminating those benefits--unless they have made a specific promise to maintain the benefits. The key to understanding your retiree health benefits lies in the documents governing your plan.

    If your employer has reserved the right in the SPD or controlling plan document to change the terms of the plan, you may lose coverage at any time during your retirement.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: DOL: Can the retiree health benefits provided by your employer be cut?" by "ignatz713". Full excerpt: Does a promise made for 22 years constitute a promise? Does a promise made for 22 years under the guise of 'additional compensation' constitute a promise? Does a promise made for 22 years before the farce known as the FHA was shoved down the throats of those who were promised lifetime retiree medical constitute a promise? How funny. So how does IBM get away with disobeying the DOL? Never mind, that was a rhetorical question.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: DOL: Can the retiree health benefits provided by your employer be cut?" by Kathi Cooper. Full excerpt: I think the 'promise' can only come in the form of a bargaining contract with employees, i.e. The Alliance at IBM (our union). It is up to IBM employees to go after their own protection. If you really care about your fate, join The Alliance.
  • R News (Rochester, NY): Xerox Retirees Call Benefit Cuts Unfair. By Casey J. Bortnick. Excerpts: Starting Jan. 1 retired Xerox employees who chose to opt out of the company's flex medical plan will no longer be given compensation for it. Beginning in Jan. 2010, Xerox will also stop offering Medicare-eligible retirees an allowance used for supplemental coverage. Some retirees say Xerox is turning its back on them at the worst possible time.

    "Sadness, disappointment, and betrayal. We really felt betrayed by the company," said John Parsnip. Parsnip spent 33 years at Xerox. After retiring in 2001, he thought his health benefits were safe. "Sometimes we get a little naive about things, so from that standpoint you could say we were surprised," Parsnip said. Xerox sent Parsnip and close to 3,700 other retirees a letter informing them their benefits would be cut. "It's going to cost my wife and me three thousand dollars a year," said Parsnip.

    Jones retired from Xerox in 2006. He took an accelerated health benefits package because he feared this would happen. Jones received a one-time payment of $20,000. This change may not fully impact him, but he says it’s wrong. "We thought the employee benefits were part of the contract between us and Xerox, but unfortunately that turned out not to be true," Jones said. Xerox says the retirees will still be able to use the company coverage but will have to pay the full group rate.

  • Yahoo! IBM Employee Issues message board: "Re: Out-Sourcing IBM Jobs" by "bits_bytes_and_bugs". Full excerpt: The problem which IBM executives conveniently ignore is that whether it is 8 or 80 or 800, the minimally skilled Indians, combined with the high turnover of 40% per year or more, and IBM's failure to pay competitively in India, means that IBM's India resources never will be able to truly replace experienced, skilled US technical resources.

    I believe that without experienced resources in developed nations like the US, Canada, Germany and the UK, IBM will never be able to design and build hardware or software products that will be able to be sold.

    I think by 2015, IBM will be in serious financial straits. Our products, particularly software will be junk. Service costs will be unsustainable. Customers will dump IBM from outsourcing contracts because of ongoing failures to meet service levels. IBM will be paying hundreds of millions in penalties for delivery failures. Account problems like the State of Texas won't be the exception, they will be the rule. There won't be enough service personnel to deal with the volume of problems.

    When that happens, the experienced technical employees that IBM has RAed will have jobs with clients or competitors or be retired. Even if IBM execs realize the low cost/low skill/offshoring approach has failed miserably, there will be very few experienced hands who will come back to save IBM. After IBM dumped them and treated them like trash, they won't come back. If IBM continues this strategy, the company will go eventually go bankrupt.

New on the Alliance@IBM Site
  • IBM Italy Union questions executive perks. Excerpts: We’d like to inform you that we have started in Italy a national campaign against IBM manager’s excessive bonuses. In the middle of the economical global crisis, and during 9600 job cuts in IBM US, the management of GTS department of IBM Italy reserved for themselves a large reward and in addition went on a free holiday to a famous and expensive resort. Our cost estimate for this holiday is between $40000 and $150000. This waste of money by IBM Italy management is not fair and is offensive in the opinion of IBM workers. ...

    Revenue and dividends are going only to the investors, and year after year more bonuses are going to IBM managers. This is having a negative affect on the morale of IBM employees. Bonuses to corporate management are under scrutiny by President Barack Obama’s administration. Management bonuses are also under the control of Sam Palmisano, our CEO and Corporate Social Responsibility offices. We will no longer accept these excessive benefits to IBM managers. We ask IBM to reinvest money in the direction of IBM workers (main stakeholders of this company), and especially to the employees that have not received salary increases for 7 or 10 years. On top of this many education course are cut due to low funds.

  • Job Cuts Status & Comments page
    • Comment 05/10/09: Can the alliance provide IBM US headcount numbers by year? My investigation indicates there were 160,000 IBM US in 2001, and that the numbers for the last couple of years are 121,000 and 115,000. I am starting to think that Robert Cringely's report from a couple of years ago that IBM was planning to layoff 100,000 US was in fact, correct. -Thinking-

      Alliance reply: Your numbers of 121,000 and 115,000 are correct. Subtract the 10,000 from first quarter job cuts and we are down to 105,000. But also remember the number of employees forced out and retired over the years AND the fact that IBM has also been hiring new people from acquisitions. The number of job cuts has been very high. Only IBM knows the true number. We can only guess/estimate; because IBM never confirms their headcount or releases numbers of total workforce reduction, publicly. They never have.

      Whether Cringley is correct or not is nearly a moot point by now. It's clear that IBM is on a long term mission to reduce the US IBM workforce to close to a single digit percentage; by virtue of their desire to increase the workforce in BRIC and elsewhere. That '900,000' IT tech job idea from Sam Palmisano to Obama is nothing but deception and an outright lie, to get $30B in Stimulus $$$. Wonder why Cringley didn't come out with a comment on that?

    • Comment 05/10/09: What is the smallest organizational unit that can be organized? And what prevents IBM from simply declaring (purely by the luck of the draw of course) that a small organization that wants a union vote is completely surplus? -Thinking-

      Alliance reply: It isn't a 'size' issue, necessarily. Size and location are only two factors. The main thrust of IBM's resistance will be denial of the unit 's existence, altogether. The difficulty is that IBM has been clever about spreading out their "organizational units" all over the globe. Then labor laws in each place fail to account for that reality, and the 'unit' can't necessarily be declared a bargaining unit. IBM is not as dumb as they are evil. Our best shot is getting small groups of members to actively organize their co-workers and get their co-workers to do the same. The hope is that it spreads like "spilled gasoline on a driveway"... figuratively speaking, of course.

    • Comment 05/10/09: Artech, who all the IBM contractors work for, or are a subcontractor of, has announced a mandatory work furlough. From May 10 - June 13, all contractors must reduce hours worked by 20%. Depending upon the organization, this may mean 5 unpaid days off in this period. This applies to the GDF staff, not sure about other organizations. Now we see the true reason for the new bias towards contractors. Just furlough them and save money immediately. The few employees left are forced to work unpaid overtime. Nearly all the 10,000 IBM staff terminated in the past 6 months were employees - not contractors.

      It appears to me that the GDF is not as successful as the big wigs planned. Several big accounts have pulled out of the GDF and/or never went in. IBM is in jeopardy of losing other big accounts too. The idea of providing limited services by low paid staff with little experience is not working. As a result of this short sighted management to save money, IBM will lose more accounts. It may take a while, but the big blue beast is heading for demise. -IBMer-

    • Comment 05/11/09: IBM will lose smaller accounts as the GDF moves are completed, but many large ones will sign on with aplomb. All that the larger clients care about is the bottom line. CFO and CIOs worry about the money that they have to report, and a savings will always make them look good. The larger the customer, the less chance there will be that they hear complaints about how poor the service is or how long it takes to get something done right. It will take them much longer to determine that what they are paying for is not being delivered out of this new framework. Notice how IBM is spinning this? There are plenty of reports lately on how IBM is hiring in Iowa despite the rough economy. There will be plenty of unskilled and unemployed workers lining up to take a Band 3 job at the GDF. Their performance will be horrid, and the reputation of IT service professionals will suffer overall as a result, but IBM will find their lackeys. -Porkchop-
    • Comment 05/12/09: Layoff date 6/24/2009. Just search the warn report for your state for more info if you are still hanging in there and wondering about the next layoff. http://www.labor.state.ny.us/app/warn/details.asp?id=2149 -warn_reports-
    • Comment 05/12/09: Confirmed today in Canada - all contractors to take 20% time off for the next 4 weeks. This is in addition to the 10% rate cuts a few months ago. -DM-
    • Comment 05/12/09: I wish we had the "WARN" system you have in the US here in Canada. Has anyone heard about GBS here? -In the Dark- Alliance reply: WARN is better than nothing; however, not much better in IBM's case. IBM has learned how to 'get around' WARN by firing just under the number that's required to notify through WARN. IBM fires in the low 20's or even 3-10 employees in a function that is spread around 2 or 3 states, and they don't necessarily, have to notify through WARN. It's typical of companies like IBM to find every way they can to skirt government regs and laws for their own sake. Employees would not have to depend on WARN or most other weak US labor laws, if they were union and had a contract to spell out all those kinds of situations over the life of the contract.
    • Comment 05/12/09: Rumour has it - but based on leaks from briefings to managers - that IBM UK will shortly announce a pay freeze for all staff - no exceptions - in the UK for this year. -Anonymous UK-
    • Comment 05/13/09: To running_out_of_time: Not true. The Rational brand has been RA'ing in a manner that looks purely like getting to lower headcount numbers, with little regard to what their skills are. In some cases, the only reason I can see for whacking person X was that they were not at that very moment assigned to a release-defining project. Their skills were top-notch, and in some cases they held irreplaceable domain knowledge about products we still claim to support. But, wrong place at the wrong time. It's very short-sighted. -irRational-
    • Comment 05/14/09: I see people trying to justify IBM's actions by spouting the company bullshit that the "Older" employees no longer had the right skills. Remember that when you condone this behavior by IBM and do nothing to stop it when your turn comes as it surely will then do not complain. Just tell yourself that your skills must have become outdated overnight.. Head meekly and quietly to the unemployment office and when that runs out to the welfare office and take comfort in the fact that what goes around comes around. Or be smart and stand with the older workers who probably trained you or at the very least tolerated your screw ups while you learned the ropes and form a union. Ongoing training to maintain job skills can be negotiated in a contract. That way you can't be too valuable right now to go to school then next year outdated. Please do yourselves a favor and stand up for one another. You will be happier and better off if you do. -Exodus2007-
    • Comment 05/15/09: ok - here is my chance to say my peace. I was just given notice last friday - stg canada - markham. I was there 15 years. Here is my take on it. First - giving a highly experienced person over 1 years pay to leave is a stupid business decision - by then the recession will be over!. Second, it really does suck here. I am glad to go. They convince you IBM is the best. Really, IBM is getting its ass kicked by competition.

      Independents and BPs are killing them as far as services go, MS is killing them on the sw side, and power is far far away from competing in terms of price. Finally system i is toast. So what do they have left? not much.

      If you are still there - make escape plans. Poorly run in terms of products, pricing, marketing and staffing. Tons of lying to upper management - false oppties in Siebel, crap everywhere and everyone convincing everyone that IBM rules all. Seriously, IBM does not and it is in big trouble. Bigger then people think - even investors. Customers are migrating to the ms stack in droves and using non ibm services to do it. -bob-

    • Comment 05/15/09: Just my two cents, but while I agree IBM targeted the more senior staff in the latest RA’s, I don’t entirely agree it’s simply a move to rid themselves of older workers based on age alone, but is a combination of reasons.
      • Senior workers, regardless of age, generally earn higher salaries and result in greater savings.
      • To have made it to “the senior class”, you are a dedicated employee who, even in the boom times, stays true and loyal. – Not likely to bend to attrition, no matter the penalty imposed.
      • Younger workers are different (not a criticism, an observation) – they are not as tolerant or loyal to a given company and when pushed, will leave – thus, no RA, simple attrition.
      • Younger workers have different benefits (i.e. retirement) and are not subject to any grandfathered clauses. They also can change the overall benefits cost if they shift the demographics of the employee base even a few years on average.
      • When I joined, most of my contemporaries were coming over a band 8 or 9. Look at the current IBM postings – most describe band 6 or even lower. I think IBM top loaded to gain market share and now doesn’t need them.

      I have watched them bring on a steady stream of “college hires” in the last few years, and most last 2 or 3 years and leave when they realize they won’t be getting double digit increase and promotions every year. They seem focused on climbing and IBM isn’t where it happens. Again, no criticism of them, I was there once myself.

      As to skill sets, in the job market I’m looking at, they commonly ask for 7 to 10 years in a given technology or even more, and assume you started you career at 25, the absolute minimum jumps you into you 30’s and probably more if you count in an MBA or several criteria like 5 years as a manager or team lead, etc. Hard to be 30 and have 15 years of professional experience with BSCS and MBA – no offense to those 30’ish folks meant.

      Also, interesting to note in the various reporting on “lay-offs” that the 3/27 RA is mentioned on several tracking sites, but no others. I personally know of an entire group in S&D that was notified 1/26, and have heard of others. Those “selected to participate” in that one need to let any media outlet know so they are not forgotten. -RA_04/2009-

    • Comment 05/15/09: Many of us are witnessing corporate behavior by IBM that seems to be getting worse instead of better. Others will deny IBM\'s is doing anything wrong and will argue this is the way companies behave in the 21st Century. I read an investment research report on IBM by Audit Integrity, a firm that evaluates the audit and legal risk profile of about 8,000 companies. The report supports the argument that IBM\'s business practices are questionable and irresponsible. IBM’s risk level was classified as Very Aggressive and IBM’s risk exposure was in the worst 3 percent of the 8,000 companies. As you can see, IBM’s recent behavior is among the worst. The full report on IBM is available for free on Fidelity’s website; however, you can view IBM’s risk rating and a summary report on Audit Integrity’s website using the below link. http://www.auditintegrity.net/public/summary.ai?ticker=ibm -anonymous-
    • Comment 05/15/09: Anyone who still works for IBM seriously needs their head examined. What a garbage company; I was fired (I like using that term instead of resource action) and have found 10-15 jobs within a month, for better pay, better benefits and I don't have to listen to IBM management (the best part). What's best is, I am on the other side now, I am the customer for IBM; prepare for some hellish times when I get payback. I'll be calling IBM for support everyday, plus I eventually plan to weed them out of the entire picture so more of you IBMers lose out. Have fun!! -Anonymous-
  • General Visitor's Comment page
    • Comment 05/09/09: to anonymous of "Just heard that In Fishkill no one below a 2+ will get one" I've heard some PBC "2+" will not get one either. My manager says the "remainder of the year is going to be rough" so that becomes a reason I guess. -anonymous-
    • Comment 05/15/09: The "Take Time" program will not be done in lieu of more RA's. "Take Time" will mean IBM can save some more money on the backs of those taking it. It'll take time but even those folks who took the time will also be RA'ed. -anonymous-
    • Comment 05/15/09: Are you a military reservist who has been resource actioned? Contact the Alliance at: ibmunionalliance@gmail.com -Alliance-
    • Comment 05/15/09: How can IBM call you "retired" when they RA you before you are 55 years old with 15 years of employment therefore giving you no FHA? The FHA was supposedly set up as a pittance health insurance plan for IBM retirees. The IBM group health plan was for those that were cheated out of the FHA and being truly retirement eligible. This company then fights COBRA and the subsidy to cost cut some more on the backs of it's former employees..IBM, you filthy greedy, immoral, thieving bastards, to force RA someone and then the friggin nerve to say the forced RA'ed person is retired shows IBM has no conscience. -anonymous-
    • Comment 05/15/09: So, is IBM receiving the 65% subsidy from DOL and then NOT passing the savings on to fired employees? Or am I reading this wrong. -an alliance member-
  • Pension Comments page
  • Raise and Salary Comments
    • Comment 5/09/09: Those lucky to get a raise other than 0% this year in North America will most likely see less than last GDP doled out for 2007 despite IBM's record 2008 results. Also, PBC "2" will not see many raises at all. A PBC "2+" also does not even guarantee a small raise. Time for a union contract with pay raises specified? -anonymous-
    • Comment 5/10/09: If you are a PBC 2+ and do not get a raise then. WATCH OUT. You are probably going to get RA'ed. IBM is not going to give a raise to someone pegged for an RA this year. You think IBM wants to increase your severance by giving you a raise now then? -anonymous-
    • Comment 5/10/09: While it's true that anybody scheduled for RA is unlikely to get a raise, it's too broad to say that a PBC 2+ not getting a raise indicates an impending RA. I'm not saying this in defense of IBM - in fact, just the opposite - they will be ever too willing to freeze the salaries of us grunts whom they choose to retain, not just those they don't. -wondering-
    • Comment 5/11/09: Based on unconfirmed rumors, it appears US raises will be determined by July 1st -better_late_than_never-
    • Comment 5/12/09: -better_late_than_never- I thought we should see our raise by 6/15/09 paycheck. Last year I got it on 6/15. If it is July 1st or later will it be retroactive? -confused-
    • Comment 5/12/09: Salary = 67000; Band Level = 6; Years Service = 3; Hours/Week = 46; Message = I have not received a pay raise my entire tenure; story is the same..Market value blah blah blah. Waiting to hear the story this year, during a time of record profits. -Starting to see the Lite-
    • Comment 5/12/09: It is highly likely that they are deferring raises until after the next layoff exit date. If the same pattern is followed for Jan/Feb and Mar/April, the next round will be notified somewhere around May 21-23 with exit date before the end of June. They like to cut out the last week so you really don't get full month salary. -annonymous-
    • Comment 05/13/09: I also heard a rumor locally that the effective date for raises this year is July 1, with first check you will see it being July 15. -FellowGrunt-
    • Comment 05/13/09: Salary = 53K; Band Level = 7; Years Service = 10; Message = I was RAed in 2009. After the reclassification (cutting 15%) and a lack of pay increases over much of my time at IBM, I was effectively making less than when I had started (considering inflation, gas price increases, and the economy, MUCH less). I have interviewed for a couple of positions now in other companies. For someone with my experience performing the same type of work, I am finding that other companies are offering $75K-125K. I knew that IBM was paying much too low in comparison to the market, as I looked into jobs within the past two years that also paid within that range. I was just too meek and scared of change to finally make the move out of IBM. The fact is that IBM is paying many of its people way below what they could be making elsewhere, and they are doing their best to reduce the costs everyday beyond that. The new GDF positions are coming in at Band 3-5. They will send those jobs overseas as soon as they can, though. -Hula Girl-
    • Comment 05/13/09: to -Starting to see the Lite- I dunno, $67K for a band 6? That's pretty high for that band I think. I know quite a few band 8s that are in the 70s (after the wonderful reclassification in Feb 2008). --
    • Comment 05/13/09: To confused, retroactive? Now that did give me a chuckle. By delaying raises 2 or 4 weeks IBM saves millions they can use for exec compensation. When they first went to giving everybody a raise at the same time we used to get raises in April or May (can't remember which). It gets pushed back and none of us can do a thing about it. Next year they might push it back even further. We are at will employees with no contract. -Long time Beemer-
    • Comment 05/13/09: To -Hula Girl- IBM doesn't care that they aren't competitive in the market anymore. Wait, let me say it like this - IBM doesn't care that they aren't competitive in the US market anymore. They're focusing on cutting US labor costs period. If you decide to quit for a higher paying job elsewhere, it's no sweat off their back as that's one less pay check they have to cut, and your workload can go to India for a fraction of the cost.

      As most of us are underpaid for our skill sets at IBM, I've seen the opposite at IBM, with a lot of 15+ year people being WAY over paid for their lack of skills. You can pretty much bet anybody with 15 or 20 years of service with IBM is most likely a Band 8 employee, and making upwards of $90-$110K (maybe minus that 15% cut from last year and depending on their geography). I work with some of these "elders" and they simply can hardly perform any aspect of their job 1) without being asked 20 times to do it or 2) without being told HOW to do it. -anonymous-

    • Comment 05/14/09: to -Starting to see the Lite- How about $60'sK for band 08 after the 15% pay cut or as IBM likes to call it: pay remix. I know it's fact. It's me. In fact, I'm off the low end of the pay grid for base salary now for Sr. I/T Specialist despite 20+ years in the biz and PBC 2 and 2+'s along the way. What can I say? IBM pays crap now. -anonymous-
    • Comment 05/14/09: I have heard that IBM has delayed salary planning "indefinitely". This way, when Sam said 250,000 IBMers will get raises, he is not fibbing. The delay is IBM's way off getting us, but they can still report to the world "we are giving our employees raises"....maybe years from now as a delay lets them maneuver any way they want. -anonymous-
  • PBC Comments
    • Comment 5/08/09: Band Level = 5; Years Service = 4; Prior Yr PBC = 2 'This Yr PBC = 2+; This Yr Bonus = 3000; Prior Yr Bonus = 2000; Message = hi -anonymous-
    • Comment 5/12/09: Band Level = 07; This Yr PBC = 0; Message = I had my IDP and with interim performance meeting recently and also heard from my manager during it that despite a PBC 2+ and below midpoint I will not get a raise. What the heck is going on? -anonymous-
    • Comment 5/13/09: To anonymous who was a PBC +2 but no raise. You said you were a band 07, but failed to provide your salary. Either your salary is in the upper limits of the Band 07 range, or your manager just flat doesn't like you. Or I guess your manager simply didn't have enough Raise Money to go around and you were the odd duck out. However, I'm curious why you're asking US what the deal is? You have every right to ask your manager why he/she chose to not give you a raise. -anonymous-
    • Comment 05/14/09: My manager says since my pay ($62K) falls in the salary range for my band 7 position it is competitive so therefore I get no raise, despite a PBC "2+". Nice huh? Is this the IBM party line now ya think? -band7anonymous-
  • International Comments
News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
  • New York Times: Industry Pledges to Control Health Care Costs. By Robert Pear. Excerpts: By offering to hold down costs voluntarily, providers said, they hope to stave off new government price constraints that might be imposed by Congress or a National Health Board of the kind favored by many Democrats.

    In remarks prepared for delivery to health care providers on Monday, Mr. Obama says: “These groups are voluntarily coming together to make an unprecedented commitment. Over the next 10 years, from 2010 to 2019, they are pledging to cut the growth rate of national health care spending by 1.5 percentage points each year — an amount that’s equal to over $2 trillion.”

  • New York Times op-ed: Harry, Louise and Barack. By Paul Krugman. Excerpts: Is this the end for Harry and Louise? Harry and Louise were the fictional couple who appeared in advertisements run by the insurance industry in 1993, fretting about what would happen if “government bureaucrats” started making health care decisions. The ads helped kill the Clinton health care plan, and have stood, ever since, as a symbol of the ability of powerful special interests to block health care reform.

    But on Saturday, excited administration officials called me to say that this time the medical-industrial complex (their term, not mine) is offering to be helpful.

    Before we start celebrating, however, we have to ask the obvious question. Is this gift a Trojan horse? After all, several of the organizations that sent that letter have in the past been major villains when it comes to health care policy.

    I’ve already mentioned AHIP. There’s also the Pharmaceutical Research and Manufacturers of America (PhRMA), the lobbying group that helped push through the Medicare Modernization Act of 2003 — a bill that both prevented Medicare from bargaining over drug prices and locked in huge overpayments to private insurers. Indeed, one of the new letter’s signatories is former Representative Billy Tauzin, who shepherded that bill through Congress then immediately left public office to become PhRMA’s lavishly paid president.

    The point is that there’s every reason to be cynical about these players’ motives. Remember that what the rest of us call health care costs, they call income. ...

    I would strongly urge the Obama administration to hang tough in the bargaining ahead. In particular, AHIP will surely try to use the good will created by its stance on cost control to kill an important part of health reform: giving Americans the choice of buying into a public insurance plan as an alternative to private insurers. The administration should not give in on this point.

    But let me not be too negative. The fact that the medical-industrial complex is trying to shape health care reform rather than block it is a tremendously good omen. It looks as if America may finally get what every other advanced country already has: a system that guarantees essential health care to all its citizens.

  • New York Times news analysis: Obama Push to Cut Health Costs Faces Tough Odds. By Robert Pear. Excerpts: Mr. Obama pronounced it “a historic day, a watershed event,” because doctors, hospitals, drug makers and insurance companies voluntarily offered $2 trillion in cost reductions over 10 years. The savings, he said, “will help us take the next and most important step — comprehensive health care reform.” Robert Gibbs, the White House press secretary, said Mr. Obama had told the health care executives, “You’ve made a commitment; we expect you to keep it.”

    If history is a guide, their commitments may not produce the promised savings. Their proposals are vague — promising, for example, to reduce both “overuse and underuse of health care.” None of the proposals are enforceable, and none of the savings are guaranteed. Without such a guarantee, budget rules would normally prevent Congress from using the savings to pay for new initiatives to cover the uninsured. At this point, cost control is little more than a shared aspiration. ...

    Henry J. Aaron, a health economist at the Brookings Institution, said that when he heard the industry’s promises on Monday, “I had a Rip van Winkle moment, as if I had fallen asleep in 1977 and woke up again this morning.” Mr. Aaron served in the administration of President Jimmy Carter, whose proposal for hospital cost controls prompted the industry to undertake a short-lived “voluntary effort.” After President Bill Clinton proposed an overhaul of the health care system in 1993 and 1994, the growth of health spending slowed, only to surge a few years later.

    Drew E. Altman, the president of the Kaiser Family Foundation, offered a historical perspective spanning nearly four decades. “Neither managed care, nor wage and price controls, nor regulation, nor voluntary action nor market competition has had a lasting impact on our nation’s health care costs,” Mr. Altman said. “Reformers should not overpromise.”

  • Health Affairs: What Does It Cost Physician Practices To Interact With Health Insurance Plans? Abstract: Physicians have long expressed dissatisfaction with the time they and their staffs spend interacting with health plans. However, little information exists about the extent of these interactions. We conducted a national survey on this subject of physicians and practice administrators. Physicians reported spending three hours weekly interacting with plans; nursing and clerical staff spent much larger amounts of time. When time is converted to dollars, we estimate that the national time cost to practices of interactions with plans is at least $23 billion to $31 billion each year. Health Affairs 28, no. 4 (2009): w533-w543 (published online 14 May 2009; 10.1377/hlthaff.28.4.w533)]
News and Opinion Concerning the U.S. Financial Crisis
Minimize "It is a restatement of laissez-faire-let things take their natural course without government interference. If people manage to become prosperous, good. If they starve, or have no place to live, or no money to pay medical bills, they have only themselves to blame; it is not the responsibility of society. We mustn't make people dependent on government- it is bad for them, the argument goes. Better hunger than dependency, better sickness than dependency."

"But dependency on government has never been bad for the rich. The pretense of the laissez-faire people is that only the poor are dependent on government, while the rich take care of themselves. This argument manages to ignore all of modern history, which shows a consistent record of laissez-faire for the poor, but enormous government intervention for the rich." From Economic Justice: The American Class System, from the book Declarations of Independence by Howard Zinn.

  • CNN Commentary: Social Security healthier than your 401(k). By Alicia H. Munnell. Excerpts: The nation's financial and economic crisis provided a stress test for the nation's public and private retirement system. The 2009 Social Security Trustees report released Tuesday provides a basis for assessing how each held up. On the one hand, assets in 401(k) accounts -- which are predominantly in stocks -- have declined in value by about a third, employers are suspending matching contributions, and millions of unemployed workers have seen their retirement savings efforts disrupted.

    On the other hand, the Social Security Administration continues to send out monthly checks to 35 million retirees and their spouses, 9 million disabled workers and their families, and 6 million families whose breadwinner has died. In other words, the government system has proved to be much less fragile than the private system of retirement savings. ...

    The new information that we have about Social Security is how well it has withstood the onslaught of the financial/economic crisis. Social Security checks have gone out on time. Though the amounts are not large, the benefits are increased each year to reflect changes in the cost of living, and they continue for as long as the recipient lives. So, despite the modest amounts, the benefits are extremely valuable and people can count on them regardless of what happens to financial markets or the real economy.

    In contrast, the financial crisis has demonstrated the vulnerability of 401(k) plans to economic and financial conditions. 401(k) balances, which are modest at best, declined in value by about one-third. And, as the financial crisis spread to the real economy, employers suspended their matches, and employees without jobs were forced to discontinue contributions. In other words, in the wake of the shift away from traditional defined benefit pension plans, the only real supplement to Social Security for most private sector workers is fragile.

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:

  • "Is this going to kill Offshoring?" by "omegadoom". Full excerpt: For some reason my other post got put into a message under a different discussion instead of a new thread... Oh well... http://www.cnn.com/2009/POLITICS/05/04/obama.tax.code/index.html

    Essentially Obama wants to close a loophole in the tax code which would pretty much kill a large incentive for IBM et al to offshore. (If you saw their patent application...) Sure you may save on the dollar per hour rate, but overall the cost incentives just went down because you lose the tax savings. Not to mention that the value add benefit isn't there.

    As someone who sold lab services, I routinely had to show the value add of why it was smarter to bring in a higher priced body for a shorter period of time, because I could show the value add and justify the rates. Offshoring is definitely losing its luster. If Obama gets his way, IBM just got spanked along with a couple of other multi nationals.

  • "Temper the hope, hold the drama" by "wonderaboutibm". Full excerpt: Omegadoom -- I sincerely hope that you are right. But IBM is really, really deep into labor movement to India. It is now their vision from the tunnel. It will take a lot more than just tax changes to slow things down. Actually, virtually every positive indicator in favor or offshoring will have to go south, and even then IBM will sail on with the outsourcing, like the Titanic, even if it means hitting the iceberg. We will see no meaningful change for the next couple of years at least. IBM has little flexibility in its approach.
  • "Point of No Return" by "Frank_Reality". Full excerpt: I generally agree, except I don't see any change happening until it is too late for the survival of the company. There's an old country saying that once a farm dog tastes blood, it will keep killing livestock until it too is killed. Once tasted, the dog craves and will do anything to get more.

    So too it is with IBM execs. When they choose to deny the many failures, high turnover, rapidly escalating salaries, quality problems and lack of productivity of low cost countries because they have tasted apparent cost savings, their arrogant strategy of myopic, relentless cost-cutting and offshoring will continue. Denial is contagious. Imagine quarter after quarter after quarter of denial heaped upon denial heaped upon denial.

    Isn't it remarkable how IBM is spending more executive resource on optimizing the stock price than it is on growing the company.

    Like the captain of the Titanic who received warnings of bergs ahead, but arrogantly steamed on at speed, Sam and his henchmen have had their warnings, but have chosen to ignore them and in fact have told the harbingers of doom to STFU.

    So by Sam's decree, it will be "stay the course, full speed ahead" into trouble.

    Like the captain of the Titanic, the thieves and scoundrels at IBM's helm will drive toward failure at top speed and by the time they recognize the abysmal condition of the company, there will be no way to recover. Unlike the captains of old who had character to go down with their ships, Sam and his ilk will head for the executive class, gold-plated lifeboats and leave the employees and stockholders with squat.

    "Nice to have known you, it was great (for me) while it lasted" Sam will shout to those freezing to death after the IBM ship sinks.

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.

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