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Highlights—October 31, 2009

  • CNN/Money: IBM Unveils New Technology to Help Governments Improve Services for Citizens. New Framework Combines Software, Services and IBM Experience in Supporting Government. Excerpts: The new IBM Government Industry Framework will help agencies of all sizes use new technologies to transform their existing support and delivery processes, allowing them to more efficiently deploy limited resources and respond more quickly to everything from public emergencies to the delivery of social services. The Framework is a base software platform that is enriched by the contributions of independent software developers who use it as a foundation to build unique applications that address particular issues across government.

    Globally, challenges such as changing demographics, security concerns and lower tax revenues are placing unprecedented demands on the government infrastructures that deliver vital services such as social services, healthcare, education and public safety. Demographics show that cities and municipalities in particular are experiencing a population explosion of new residents, placing additional strain on governments to meet the needs of its constituencies. At the heart of IBM's business transformation strategy is the recognition that the increasingly instrumented world and the boundless possibilities offered by technology can help all organizations, including government, reach new levels of efficiency. In all of this, the traditional definition of "workstation" has been expanded to include hand-held devices that enable workers to connect remotely with their colleagues and interact with sensors, video and other information gathering technology embedded in everything from buildings and machines to vehicles, traffic signals and utilities. ...

    "For the first time we can see into our client activities to help them meet our (federal, state and county) rules for receiving benefits, or redirect funds to families that need our help much more rapidly," said Don Edwards, Deputy Agency Director of Alameda Social Services Agency. "This milestone demonstrates that states and counties can securely verify that their records reflecting client cases are correct and can be shared. The ability to connect and exchange appropriate common client information will enhance the stability and well-being of our children, adults or elderly, and their families

  • eWeek: IBM Fired from $1.34 Billion Contract with State of Indiana. By Don E. Sears. Excerpts: An IBM-implemented welfare system came under a lot of scrutiny by state lawmakers and the governor as demand for services in Indiana skyrocketed while costs on the contract rose. The task-based approach to individual case work did not deliver the expected efficiencies, though it helped cut down on fraud, admitted the state. The new system will be a hybrid of former ways, including individual case work but with the flexibility of the digital age.

    On Oct. 15, IBM was officially terminated from a 10-year welfare services contract with the state of Indiana—a project intended to improve the efficiency and quality of working with welfare recipients. A press release about the termination came from Gov. Mitch Daniels, who stated that Indiana plans to move ahead with a "hybrid" strategy that will include more face-to-face contact and "localized team based case management," said a news release.

    The IBM system eliminated face-to-face meetings and took a task-oriented approach rather than a case-based approach and was not working well for Indiana residents, said the state. While there were improvements to the system in terms of eliminating fraud, increasing state case loads for employees and adding some new jobs to Indiana, fundamental problems still exist, claimed the state in the news release. ...

    IBM representative John Buscemi told the AP following the news of contract termination, "'IBM rejects the state's claims and believes the state's actions are unjustified." Asked whether the company was considering suing the state, he said, "IBM will take action as appropriate to protect its rights under its contract with FSSA."

    Selected reader comments follow:

    • IBM Asked For It: I think this is hilarious. IBM destroys American lives with ridiculous offshoring and H1b use to the detriment of America and to hear that Indiana canned IBM makes my heart pitter patter with love for Indiana. Now a quick call to Iowa where they just opened a new facility with tax credits to show them how North Carolina is struggling after the dumping of a huge tech force under their tax credit plan. Can Iowa stand to have more unemployed people, kick IBM out now before the people get to adjusted to being IBM and the state gives tax dollars away to IBM-The Horrible.
    • Funny: All these companies help save money yet ruin the lives of many American's by outsourcing quietly to India.
    • The first of many for IBM: IBM has outsourced over 90,000 jobs in the last few years to the BRIC countries, believing that folks in Brazil, India, etc. with a minimal amount of training and enough documentation, can replace what it took the Americans, who built IBM, 20+ years to learn and achieve. This is the first of many losses for IBM over the coming years. You can't charge Ferrari prices for Hyundai performance, even if you are IBM.

  • The Register (United Kingdom): IBM board gives Big Sam another $5bn. Continues throwing money at market to inflate EPS growth. By Timothy Prickett Morgan. Excerpt: IBM's stock repurchasing addiction to show earnings per share growth continues unabated, and today the company's board of directors gave the company's management another $5bn bag of junk to take to Wall Street to buy back its own shares in the coming year. The news came as IBM was paying out its quarterly dividend of 55 cents per share, payable on December 10, and it was a reason for Big Blue to remind everyone that it has been paying out quarterly dividends since 1916. Other dividends might be bigger, but IBM's is longer and keeps a predictable rhythm, even in stressful times.
  • Local TechWire (RTP, NC): At IBM, Robert Moffat's identity has been erased - Lawyer speaks out. By Rick Smith, Excerpts: Robert Moffat has been erased at IBM, “Biography you tried to access does not exist,” reads IBM's Web site when someone tries to access a link to Moffat's biography and photo. The confidant to IBM Chairman and Chief Executive Officer Sam Palmisano was placed on leave Monday following his arrest on Friday for allegedly participating in an insider trading ring.

    His lawyer, meanwhile, spoke out in defense of Moffat. Kerry Lawrence said the government hasn't accused Moffat of profiting from the alleged scheme, The Associated Press reported. “Not only have they not alleged that, but that definitely did not happen,” Lawrence said. ...

    Moffat rose through IBM's ranks with a reputation for cost cutting and job slashing. In fact, a wire service story described him as a “cost cutting maven.” He also spearheaded the sale of IBM's PC division to Lenovo in 2005. The AP picked up on the cost-cutting in Moffat's career as well, noting: "IBM has trumpeted Moffat's ability to slash costs and make the company faster and more efficient, particularly in manufacturing." ...

    However, Moffat's career may have come to a stunning close with the allegations that he provided inside information about Sun, IBM and AMD to the insider ring.

    The case caused Conrad to question Palmisano's judgment in promoting Moffat. “It is equally disturbing that this person was hand picked by Sam Palmisano to be the next CEO,” Conrad said. “What does this say about Palmisano's judgment in picking this guy as the next leader of IBM? “But remember this is a guy who slashed thousands of jobs,” Conrad added. “That is how you get promoted in the new IBM.”

  • I, Cringely: Silence isn't Golden. By Bob Cringely Excerpts: Judging from the 70+ reader comments, many from present or former IBM employees, my last column about the arrest of IBM Sr. VP Bob Moffat on insider trading charges hit a nerve. In a few hours I'll be posting another column on a completely different topic, but I can't let this one go without making one more observation. It has been almost a week since Moffat was arrested and in that time, as far as I can tell, IBM has made no comment on the case to the press or even to its own employees. ...

    Lack of comment suggests Big Blue doesn't know what to say. Perhaps the company is paralyzed. Maybe there is disagreement in the executive ranks about how to handle the problem. Maybe Moffat, himself, was the guy who would have helped craft any response but now he's unavailable. Beats me. But it doesn't smell good.

    Selected reader comments follow:

    • Blue Blood Busted says: I'm glad to see that dirtbag Moffat got caught. Not surprised, expecting more to fall. IBM has turned into a dying cash cow for its execs; bleeding it to death with their greed. They'll rape and pillage the company, sacrifice service to its customers, and bail out with a golden parachute. IBM's only successful “product/service” is eliminating U.S. jobs…. how else would they post a profit with ever-decreasing revenue (due to it's crap service and products).
    • Cringely sez: “…Doesn't IBM management owe that to its 398,000 employees?…” Bob! IBM is now an off-shore company with a vestigial headquarters in Armonk, NY! There are no more than an estimated 100K employees stateside and that is likely to shrink to 60-70K in the next two years…or sooner.
    • I left IBM a couple of years ago, and have always felt so good that I left. The management is incompetent, and yet, they are judging us on our PBC's. All the wasted time on development plans, but wait, training was cut years ago! The list goes on, no raises, no training, low morale, yet stock holders don't seem interested, but, eventually, won't the bottom drop? These jobs offshored, do they pay taxes? I'm sure not! The real injustice, is the treatment many of those from India would do to us, most are incompetent, but for some odd reason, management thinks they're smart, I didn't understand that, and yet, many of those people from India have rosen in the ranks, but like the guy busted on wall street, he wasn't that smart, he was a crook, I wish people would wake up to this. Give us our country back, and our jobs. Things are just so messed up in IBM, I honestly believe they will soon be out of America all together. And our President will help finance this project will stimulus money. Very sorry about all of this.

  • Yahoo! IBM Employee Issues message board: "Why no Perp Walk for Moffie?" by "nyjints5". Full excerpt: Moffat surrendered to the FBI at their office in White Plains on Friday morning Oct 16th. All of the other defendants were arrested and perp walked by the FBI on Friday morning the 16th. So exactly how did those arrangements get made? The complaint naming Moffat was signed by Judge Eaton on Thursday the 15th. That means two Special Agents had to have been dispatched to arrest Moffat on the 15th. They probably went to his home in Ridgefield where they didn't find him. So the next place they'd look for him would be at work in Armonk. Oh Boy!!

    Can you imagine the look on his secretary's face after the guard at the front desk who escorted the agents to his office said; "These men are from the FBI and they need to speak with Mr Moffat." She must have told them he was out of the office. The agents then probably asked; Can you reach him by phone?"

    Imagine how Moffat must have felt when he heard the man's voice on the other end of the phone say; "This is FBI Special Agent So and So. I have a warrant for your arrest for Conspiracy to commit securities fraud." It's no wonder he was shocked! Wonder what the secretary did when she heard THAT! She probably ran straight into Sam's office..... Talk about stuff hittin the fan!! WOW!

  • Financial Times (United Kingdom): Pressure on IBM over Galleon case. By Richard Waters. Excerpts: For a company that has always prided itself on the highest standards of corporate ethics, IBM is facing one of its hardest decisions: how to deal with the accusation that one of its most senior executives illegally passed on inside information. Robert Moffat, a 31-year veteran and one of the most trusted lieutenants of Sam Palmisano, IBM's chief executive officer, was among six people charged earlier this month in the insider trading case centred on the Galleon hedge fund. His lawyer has said he did not pass on any illegal information and pointed out that he is not accused of having tried to profit from the trades at the centre of the complaint.

    One person who has worked with him describes him as “locked-down, very polished, process-driven”, a classic product of IBM. IBM moved fast after the complaint was filed, putting Mr Moffat on leave and stripping him of his position as a corporate officer. His biography was quietly removed from the company's website. ...

    “I don't think it'll make a ripple,” said Bob Djurdjevic, a former IBM executive who now runs a technology consulting firm. Yet the accusations will leave a mark, given the personal trust Mr Palmisano has displayed in Mr Moffat during his own rise through the ranks. Mr Palmisano first came to rely on Mr Moffat in the mid-1990s, when he was put in charge of IBM's struggling PC division and Mr Moffat was handed the job of sorting out manufacturing and distribution. The operational genius he displayed later led Mr Palmisano to name Mr Moffat head of the PC division himself, pushing aside another executive in the process.

  • Wall Street Journal: Figure in Insider Case, Moffat, Is Out at IBM. By William L. Bulkely. Excerpts: International Business Machines Corp. said Robert Moffat, a high-ranking executive facing insider-trading charges, has left the company. Mr. Moffat, 53 years old, was IBM's senior vice president for technology and regarded as a possible future chief executive until prosecutors accused him this month of passing along confidential information on IBM and other companies as part of an alleged insider-trading conspiracy that benefited hedge funds Galleon Group and New Castle Partners.

    Mr. Moffat has retired and "was not terminated" from IBM effective Oct. 31, said his lawyer, Kerry Lawrence. He said that Mr. Moffat, who is free on $2 million bail, retired "to devote his time to defending the charges that have been filed against him." Mr. Moffat had been placed on leave after he was charged with conspiracy in the insider case. Authorities said he discussed coming IBM and Sun Microsystems Corp. earnings announcements with Danielle Chiesi, who worked at New Castle and has been accused of trading on the information. IBM was in talks to buy Sun at the time.

  • Financial Times (United Kingdom): Moffat leaves IBM after Galleon affair. By Richard Waters. Excerpts: IBM refused to comment on the circumstances surrounding his departure, confining itself to a brief statement: "Bob Moffat, who had been placed on a leave of absence as a result of a US federal investigation into his personal activities, is no longer an employee of IBM." A spokesman added that the company did not discuss "personal matters regarding employees or former employees".

    Kerry Lawrence, Mr Moffat's lawyer, said that the executive had "retired from IBM, he was not terminated or fired". He had left the company "so he could devote his time and energy to defending himself against the charges," Mr Lawrence added. He reiterated that the former IBM executive was "still asserting his innocence". Mr Moffat's quick departure, and IBM's decision to characterise the matter as a purely personal one, contrasts sharply with the approach taken by other companies whose executives have been drawn into the insider trading case.

    An executive at Intel and a partner at McKinsey, who have also denied insider trading charges, are both on administrative leave, according to the companies. These companies have also been public about launching internal investigations into the affair, as has Akamai, where an executive is alleged to have passed on inside information though not charged. Some of the companies caught up in the affair have also moved to reassure their staff and customers by promising reviews of their ethical codes of conduct for executives.

  • BizCovering: Greed, Scandal, and Lies are All Part of Massive Us Layoffs and Restructuring at IBM. Full excerpt: Some may think IBM is known for its sterling business ethics and character. Many older people might remember the Watson family whose motto was, “respect for the individual”. Well much as Virginia Slims ads used to say, “You've come a long way baby.” IBM's tag line should be you have fallen a long way baby.

    It was not bad enough that Moffat is outsourcing US jobs at record levels out of the country and treating the employee like chattel but things are far worse than that. People are forced out due to their age; EEOC is protecting the employer, with little recourse for the employee. Sam Palmisano can not make his top line revenue (sales) targets so he is squeezing every dime out of the expense side of the business by giving employment to those who will work cheapest. IBM is becoming a worldwide sweat shop so Sam Palmisano and other top executives can get their performance pay. The most recent financial numbers from a week ago prove that.

    Well that leads into what this article is about Bob Moffatt the poster boy for greed and scandal. The FBI describes Moffat as an IBM senior VP executive who secured insider trading information on IBM business partners and other computer companies , such as Sun Microsystems, Advanced Micro Devices and Akamai, and gave that information to a Danielle Chiesi, an executive of New Castle Ventures. ...

    The FBI had been watching Moffat's activities for quite some time. Moffat interesting enough, was one of the grand architects of the send the jobs out of the county strategy. What a swell guy, Moffatt appears to be totally without any morals that guide him except the motive of greed.

    Yet President Obama has invited Sammy P to Washington to help him figure out how to get more jobs for the US and fix the economy. Does Obama have even the basics of an economic background? Does his staff not read about IBM's layoffs to employ people in under-developed nations where they work for $.20 on the dollar? Obama is ignoring unemployment because his focus in on health-care. Guess he says let ‘em eat cake.

  • JobVent, Employee Review of IBM. From Atlanta, GA. Excerpts: I HATE IBM. They took the young, enthusiastic, idealistic 27 year old I was when I was hired by PricewaterhouseCoopers (PwC), took over the portion of the company I worked for and made us all "IBM blue" complete with serial numbers, and over a span of 10 years they ground all the life and the joy out of not only working with a consulting firm but for working ANYWHERE AT ALL

    Everything that is written here about their PBC review process is true. Performance based bonuses in my department over the years were nearly non existent; raises even more rare, and ranged from only 1-3% at proposal manager level which didn't even keep up with annual cost of living increases or inflation - despite the fact they had us all working in proposal management support through countless all-nighters, weekends, holidays, piling up UNPAID overtime hand over fist.

    My department's "powers that be" stopped paying OT wages in April 2005, promised us we would have more work-life balance in return by not being expected to work but a fraction of the OT hours we had been putting in up to that point, and within a month I was putting in more OT hours than EVER.

    At a time when our management kept drumming high utilization numbers into our heads in order to keep our jobs, I stayed and kept taking it. I maintained a weekly spreadsheet of the OT hours I was putting in for the rest of the year (ending with a utilization rate for the year of 101%), had numerous stellar reviews from proposal teams I'd supported, 3 "IBM Thanks Awards" awarded to me by clients, zero negative feedback, and clearly met and exceeded the PBC and IDP goals I'd set for that year - and yet when review time came, my manager DROPPED me from the 2+ rating I'd received (from my previous manager the year before) and gave me a 2. No reason was given for the lower rating, just that my contributions were "satisfactory" and "on par with my peers". Well, I had access to the same utilization spreadsheet my peers were entering their numbers into and I had the second highest utilization average in the department next to the pucker-up king who most everyone knew was padding his numbers to make himself look good because he was a sloppy drunk who worked from home and did a half-a** job (I should know, I had to bail him out on a few occasions and saw some of the documents he had worked on).

    To sum it all up, if you aren't the best a**-kisser in the department, they stifle your career and keep you boxed up in a profile of lower pay range (while lying to you about your rate of pay being competitive and on average with your geographic area) and devaluing your contributions with their forked tongued PBC grading methods, in a way I can honestly compare closely to brainwashing into making you believe you are what they say you are, and nothing more

    The guy who said there is no recognition or incentive given to the INDIVIDUAL and that everyone at IBM is just a "resource" hit the nail on the head. I slaved away for them until I had high blood pressure, nervous jitters and twitches, patches of hair falling out of my head, and literally gave them my blood sweat and tears for 10 years. I will never get back any of those hours I had to spend away from my family late into the night.

  • JobVent, From FL — 10/24/2009. Full excerpt: I worked for IBM for 15 yrs and left voluntarily in July. IBM has become a company devoid of integrity and ethics. They blatantly lie to the employees and ask the employees to lie to the customer. There was no longer any respect for the employee or the customer. Customer SAT is no longer a consideration when making decisions. It had become all about enriching those at the top (at the expense of the worker bees) and cutting costs. I would not recommend IBM as a place of employment for anyone!
  • JobVent, other Working at IBM — Reviews by Employees.
  • Austin Business Journal: Court: Ex-IBM M&A chief can work at Dell. Excerpt: IBM Corp. has lost a bid to block its former mergers and acquisitions chief from working at Dell Inc. The U.S. Court of Appeals in New York denied IBM's request to reverse a June ruling to allow David Johnson to continue in his role as Dell's senior vice president of corporate strategy, Bloomberg reported. IBM officials sought to enforce a one-year noncompetition agreement provision with Johnson, previously a 27-year IBM veteran.
  • Hudson Valley Times Record-Herald: Assemblyman calls for probe into IBM pact. By George Spohr. Excerpts: The chairman of the Assembly's Committee on Corporations is investigating IBM's financial dealings with the state. "We are actively investigating it, and we will hold hearings if we feel it's necessary," said Chris Valens, a spokesman for Richard Brodsky, D-Elmsford. Assemblyman Greg Ball, R-Patterson, who is challenging Democratic Rep. John Hall for the 19th Congressional District, says that doesn't go far enough. He's made IBM layoffs a campaign issue. "And now, many months and layoffs later, my efforts to shed light on the state's dealings with IBM through the proper channels, by holding an open public hearing with this committee, are still being ignored," Ball said. "If this isn't a cover-up through stonewalling, I don't know what else to call it." ...

    Ball's criticism of IBM layoffs centers around a 2008 Empire State Development Corp. agreement between the company and Gov. David Paterson's office. Under the pact, IBM continues to receive millions of dollars from New York so long as it maintains a minimum number of semiconductor workers at IBM East Fishkill — which it has. In exchange, IBM has invested hundreds of millions of dollars in the Albany NanoTech project, where the company and its partners have created clusters of high-paying nanotechnology research, development and manufacturing facilities. Since January, IBM has laid off hundreds of workers in Orange and Dutchess counties. It still employs more than 9,000 workers in the mid-Hudson and remains the region's largest private employer.

  • Yahoo! IBM Pension message board: "Re: Employees face "shockingly higher" health costs" by "ibm_vet". Full excerpt: Well, received my IBM 2010 retiree benefit package today. Shocking increase is an understatement. Here are the numbers for the plans in Georgia for Non-Medicare Self+1.
    Plan % Increase Annual Amount
    BCBS of Georgia 54.4 $8,004
    Kaiser Permanente 55.6 $12,456
    IBM EPO 11.3 $11,856
    IBM High Ded w/HSA 20.7 $9,732
    IBM High Ded 27.4 $4,572
    IBM Medium Ded 10.5 $10,368
    IBM Low Ded 10.9 $13,860

    And to think three short years ago I was paying, as a retiree, only $275 a month for BCBS and Dental. This sucks.

  • Yahoo! IBM Retiree Information Exchange message board: "Re: IBM Medical for Cost for 2010". By "jsb2b2". Full excerpt: Here is a brief history of my case in NY: Here is a brief history of my case in NY: Employee: 2004 IBM EPO - MVP = $48(Self) / $101(Self plus 1) per month. Took early retirement at age 55.
    Retiree: Self/Spouse (Self plus 1) Cost per Month Percent Increase
    2005 IBM EPO - MVP $ 93/$326
    2006 IBM EPO - MVP $100/$400 7.5 / 22.6
    2007 IBM EPO - MVP $117/$503 17.0 / 25.7
    2008 IBM EPO - MVP $150/$690 28.2 / 37.1
    2009 IBM EPO - MVP $193/$888 28.6 / 28.6
    2010 IBM EPO - MVP $246/$988 27.4 / 11.0

    So the Retiree is paying $8904, the full cost of the non-medicare spouse, and $2952 the cost for the non-medicare Self. Add IBM's $7000 and the Self is $9952 and the Self plus 1 equals $18,856 per year. But, as IBM states, they can terminate their generosity at any time.

  • Yahoo! IBM Pension and Retiree Issues message board: "Re: IBM Medical" by "fstephens". Full excerpt: Feel HAPPY ! When on the FHA, we pay about what you show for Self+1, for just one. There is no other supplement used in what we are charged. I am waiting to see my package and/or to see what shows up on Netbenefits Health when the enrollment info finally shows up. I think I will start crying now, as this will use up almost all of what I have left in my FHA. If the RUMORS are true, 2010 will be the end of the FHA fund existing, then it won't matter anyway for me.
  • Yahoo! IBM Pension and Retiree Issues message board: "Re: IBM Medical" by "ranheimchas". Full excerpt: IBM purposely put the retirees in a "High Risk Pool" so they could justify raising our cost in order to lower what the active employees have to pay for similar plans. What haunts me is thinking about all the times I was told at each pay raise, how part of our increase is being differed so that we would have paid up medical for the rest of our lives after retirement (with 30 or more years of service). This was "Differed Compensation", meaning we already worked for this future medical benefit that was taken away. For 40 years I worked my heart out, and gave up many prime vacation times, because I had so much respect for the company and their promises. I sure got fooled on that one. Now, the largest expense my wife and I have is our medical, and it just keeps going up. Thank goodness we have been saving extra for retirement enjoyment. So much for that idea. Now, we are spending most of it just to keep our heads above water.
  • Yahoo! IBM Pension and Retiree Issues message board: "Re: IBM Medical" by "ibmretiree2006". Full excerpt: ranheimcas, the IBM apologists will tell you that what you were "TOLD" means nothing. That you should have read the FINE print that said "subject to change". The bean counters saw a way to dramatically reduce IBM's commitment to retirees and they took it. And I too worked my heart out. To the point where it took a tremendous toll on my family. But we all agreed it was worth it. Bull$hit!!! We were scammed big time and are being scammed even today. Old timers have, I think, a difficult reconciling the current IBM with the one we worked for. But as I am often told "business is business" and "every other corporation is doing it". My loyalty and respect for IBM is equal to the loyalty and respect they demonstrate for me!!!
  • Yahoo! IBM Retiree Issues message board: "Re: Did you say goodbye to IBM?" by "scall0way". Full excerpt: Our whole department got moved into ITD earlier this year. We knew as soon as it happened it was not good news. Their propaganda pieces they sent us to review showed them to be a world-wide organization providing outsourcing support to customers, and they said their stated goal was "to provide the highest possible service at the lowest possible cost." And since we are here in the US, and most of us older (the "baby" of my department turned 50 earlier this year) we knew that there was no way that we could be "the lowest possible cost". So we were pretty sure it was all a matter of "when" not "if".

    This despite the fact that our new second line manager came up from Raleigh to meet with us in June, and remarked with surprise, "Wow, I understand some of you were worried your jobs might go away when you got moved into our organization. I had no idea you would think that. I'm sorry you were so upset. We have absolutely no plans to make any changes here in with your jobs"

    That was in June. Funnily enough when he called the meeting in October to tell us our jobs are going to IBM India he didn't fly up to meet with us face-to-face but did it via a telephone conference call.

  • New York Times: For Delphi Pensioners, the Union Label Helps. By Mary Williams Walsh. Excerpts: Bruce Gump and his neighbors feared for their retirement checks when the federal government took over the pension plans at Delphi, the big auto parts maker where they once worked. But four months later, Mr. Gump finds himself in a far more perilous condition than his neighbors. On his street, he is the only Delphi worker whose pension benefits may be cut. His neighbors all belong to unions and have received a lifeline in an unprecedented deal related to the government-supervised bankruptcy of General Motors, the onetime parent of Delphi. (G.M. spun off the parts division as a separate company 10 years ago.

    Mr. Gump and some 21,000 other salaried workers and retirees are furious that their roughly 46,000 union co-workers at Delphi have had their benefits restored, apparently with government largesse, and they have not. “They've been relatively well taken care of,” he said. “But I'm being thrown out with yesterday's trash.”

  • Mercer: Creating the impression of lifetime retiree health benefits is breach of ERISA's fiduciary duties. Excerpt: An employer breached ERISA's fiduciary duties by giving employees the impression that retiree health benefits would continue for life when, in fact, the company had the power to eliminate them at any time, ruled the Third Circuit Court of Appeals (In re: Unisys Corp. Retiree Med. Benefits ERISA Litig.). The court said the message to employees during retirement counseling was “at best a half truth” without mention of the company's right to amend the plan. The latest decision in this protracted litigation reminds employers not to overpromise in retiree health or any benefit communications.
  • The Register (United Kingdom): HP faces first ever UK strike action. Big name customers could suffer if staff walk out. By Kelly Fiveash. Excerpt: HP faces possible strike action from some of its employees in the UK, after trade union Unite announced a vote among its 150 customer engineers, whose jobs are being shifted to a subsidiary firm. If the strike gets the go-ahead, it will be the first of its kind at HP, which in the past two years has undergone dramatic job culls in a move to cut costs at the computer vendor. Unite said in a statement that it had begun a ballot that covers home-based customer engineers and support specialists who operate across the UK for HP. Staff are angry about being shunted over to HP's subsidiary company HP CDS at the start of next month. Unite claimed the computer giant is removing pay and pension benefits, including a performance bonus scheme worth up to £2,000 and a final salary pension scheme.
  • CNN/Money: IBM To Provide Employees With 100% Primary Health Care Coverage, New Wellness Rebate PR Newswire Underscores IBM's Commitment to Wellness and Primary Care to Improve Employee Health and Lower Costs. Excerpts: IBM today announced that it will provide U.S. employees with 100 percent coverage for primary health care, beginning in 2010. Employees enrolled in IBM plans will receive full coverage throughout the year -- no coinsurance or deductible -- for in-network primary care with their internist, family practitioner, pediatrician, general practitioner or primary osteopath. IBM will be among the first U.S. companies to cover primary care at 100 percent. ...

    IBM's expanded support for primary care will lower costs for employees by eliminating co-payment or co-insurance any time that they, or covered family members, receive care from an in-network primary care doctor. It enhances IBM's coverage for preventive or "wellness" visits, such as yearly check-ups, which began in 2006. The new benefit will apply to all IBM-self insured medical plan options, which currently cover about 80 percent of IBM employees in the U.S. Other employees participate in HMOs, which typically provide most, but not all, preventive and primary services at low or no cost after payment of premiums.

  • Yahoo! IBM Employee Issues message board: "Re: What Health Plan to select based on IBM announcement" by Elaine Petrone. Full excerpt: The devil is clearly in the details on this stuff and IBM is using the smoke and mirrors to get us all excited, but read carefully.

    From what I've read, the only copay that has been removed by this new announcement is the copay to your PCP for the doctor's part of the visit. You'll still have to pay copays on any actual procedures and on labs and tests. AND you'll need to pay copays if you see any specialists. It's only your primary physician services that are "free". In my family's case, the increase in my monthly premium exceeds the amount I spend on my primary physician co-pays.

    In addition, the annual deductible on PPO is up, $130/person (almost 17%)! And the copays for the Rx drugs is way up for those on long term Rx. While the percentages are the same, the caps are up as much as $80 per fill if you are taking an expensive drug.

    This is not a gift from IBM, this is a PR ploy. Look good to employees, look good in press, look good to White House....Just don't look too close.

    As for which plan you should sign up for, there is no simple answer. You really need to look at what your family's situation is. I always spend some time examining what we've spent on various medical expenses the last few years and try to project what is likely in the next year....then calculate the costs plus premiums to see how things compare out.

  • Yahoo! IBM Pension and Retiree Issues message board: "Re: Changes to Employee Benefits" by "ibmaccountant". Full excerpt: IMHO, the TBJ is on the IBM Communications payroll. They have never, ever led with a critical article on IBM to my knowledge. They are desperately trying to use TBJ and N&O to promote the idea that IBM is still a company that makes a difference and a wonderful, innovative place to work. Word on the street has it that despite the tough economy they are having a tough time finding people interested in working at IBM. The reputation for deplorable working conditions, poor benefits and long hours is finally starting to hurt the brand image.

    As was stated very aptly in "Entrepreneur magazine" last month, "any company that keeps talking about innovation isn't really innovative, it's just trying to look innovative for marketing purposes". That describes IBM to a tee.

  • Yahoo! IBM Retiree Issues message board: "Re: Not many options" by "lrafalow". Full excerpt: Like everyone else, I'm now focused on my health insurance choices. I'm in the FHA (with no blue dollars left after just 3 1/2 years) so I pay all of the premium costs: a little less than $18,000 a year for two people under the EPO, not the most expensive option BTW. This is a 5.5% increase over last year when the CPI-U medical costs component increased 3.3% for the 12 months ended Sept 30. This is unsustainable.

    In response to your question, no, I'm not saying that their numbers are wrong, just their analysis. Actually, their numbers may well be wrong--economic forecasting was invented to make astrology look good, to paraphrase John Kenneth Galbraith--but I'm not in a position to argue.) I've read articles with relatively simple fixes to previous generations' fiscal failures (both public and private pensions and retirement health plans: most companies are in as deep as social security and medicare, they just don't cover as many people).

    The flaw in their analysis is that they start with the Reagan bias that government isn't part of the solution and use steady-state numbers to scare people.

    1. The simple fixes that have been published are things like means-testing some benefits, raising premiums and finding efficiencies in the system, see below.
    2. Health care costs are currently paid in a number of ways, from direct subsidies for the insured (insufficient premiums over a lifetime of work) and insurers (e.g. Medicare Advantage) to subsidies provided in medical research from which private companies extract profits, public grants for hospital expansions and very long and easily refreshed copyright protections for drugs, all the way to tax increment financing for large businesses including health care businesses. We also pay for the insurance for the elderly, the poor, vets and of course active duty not to mention public employees. I'm sure there are lots of other ways the taxpayers at federal, state and local levels pitch-in to health industry operating and capital expenses as well as profits. We also pay roughly $1000 per year to cover those without health insurance so they can go to the emergency room to get inappropriately expensive and frequently late in the illness and therefore less effective care with higher mortality rates. Here's one idea (not being considered because it's socialism...whatever that means), let's bring this all under one umbrella so we have a little transparency and can make rational decisions about the portion of our collective wealth we think is appropriate for health care...it's called single payer, or Medicare for All. I'm guessing that the 16% of GDP estimates don't include all of these expenses. But the next closest developed country's GDP figure I believe is Switzerland at 12% with other countries much lower and all with better health outcomes.
    3. One of things the Obama administration has proposed is that we change the way health care payments are administered. Instead of paying for procedures and the built in incentive to have lots of them--we pay for results. There are a number of successful examples of this providing better results at lower costs. And why not include a little tort reform while we're at it; credible estimates are that it would save less than 1% of the health care dollar--certainly less than the 20+% low-hanging fruit of administrative overhead--but worth pursuing.

    Lastly, shouting about Social Security, Medicare and Medicaid make good politics for the right. It plays to their theme of leaving everything to profit-making enterprises and it scares people about budget deficits and the world their children will inherit. But it's disingenuous. We know that government can be more efficient than the private sector and can administer programs that don't try to eliminate people from their rolls so they can goose profits. And we spend trillions of dollars on war and war equipment without a peep from Republicans (with one exception that I know of: Ron Paul, who isn't a real Republican). Military spending is a classic example of an inflation driver: like any consumption, you spend money to build something that you're going to use up (or blow up in this case) and so we have the same number of dollars now chancing fewer goods. We also spend trillions of dollars on bank bailouts with few strings attached (none during Bush, few during Obama) and little commitment to prevent it from happening again; and this is a bipartisan failure.) And Republicans argue that not only do we not have the money for heath insurance for every American but we also don't have the money to prevent catastrophic results--that our children will inherit--of climate change.

    It's all a game to keep us distracted sniping at each other while the incumbent masters of the universe continue to cash in. We're all ready for pitchforks, we just don't agree upon whom to skewer. So, my next project is to work on getting money out of our political system...the first prerequisite for good government and rational debate. I'm going back to trying to figure out if there's a cheaper IBM option that'll work for my wife and me. Cheers, Lee

  • Yahoo! IBM Retiree Information Exchange: "Re: Not many options" by "Paly". Full excerpt: It is a long way from the "free for life" promise made to me when I was hired in 1968. I too have been reminded of the same thing MANY times in my time with iBm. Why would managers mention that same thing different times and different places recalled by different people.
  • When Friday were Fridays: Ten Things to Do When You Leave Corporate America. Excerpt: What's the best part about not having to get dressed up and go to work every day? Time. When you leave Corporate America, what are you going to do with all that time? Or – if you've already left, what are you doing with all that time? Here's my top ten list for things to do when you leave Corporate America (in no particular order)....
  • BusinessWeek: Study: No Shortage of U.S. Engineers. America is turning out plenty of science and engineering grads, a university study concludes, but many of the best are taking jobs in finance and consulting. Excerpts: U.S. colleges and universities are graduating as many scientists and engineers as ever, according to a study released on Oct. 28 by a group of academics. But that finding comes with a big caveat: Many of the highest-performing students are choosing careers in other fields. The study by professors at Rutgers and Georgetown suggests that since the late 1990s, many of the top students have been lured to careers in finance and consulting.

    "Despite decades of complaints that the United States does not have enough scientists and engineers, the data show our high schools and colleges are providing an ample supply of graduates," said study co-author Hal Salzman, a public policy professor at Rutgers, the State University of New Jersey. "It is now up to science and technology firms to attract the best and the brightest graduates to come work for them." ...

    The researchers' conclusions suggest that making careers in STEM fields more attractive—through higher salaries, for example—could help employers solve recruiting problems for top talent. "Highly qualified students may be choosing a non-STEM job because it pays better, offers a more stable professional career, and/or is perceived as less exposed to competition from low-wage economies," reads the report. Employers such as Microsoft (MSFT), however, argue that the problem of attracting talent would not be solved by raising pay but rather by adding more of the best candidates to the talent pipeline. Last March, Microsoft Chairman Bill Gates testified before the House Committee on Science and Technology and said salaries are not the problem when his company tries to recruit top scientists and engineers. "It's not an issue of raising wages. These jobs are very, very, very high-paying jobs," he said.

  • Yahoo! IBM Retiree Information Exchange message board: "Canada Drugs" by "Torbill". Full excerpt: These Part D drug plans are moving from good values to ripoffs, as far as I am concerned. The premiums are going up, and the co-pays are going up, and you hit the donut hole faster because the drug companies are jacking the hell out of their branded drug prices.

    Also, the formularies are so restrictive, in many cases, that if you take more than one branded drug you have a hard time finding a plan that gets you covered. Or, if you are like me, where I have to switch every half year or so from Aciphex to Nexium to Prevacid to Protonix in order to avoid building up a tolerance, it is next to impossible to find an acceptable formulary.

    Frustration and anger here.

    My wife and I are trying the Canada drugs path. We have each ordered a prescription fill from a Canada pharmacy. Hers is Lipitor. Mine is Aciphex. In the U.S., neither of these medicines is available as a generic. In Canada, both are. We are going to try them as generics, and if there are problems, we will order the branded versions.

    Here will be our strategy for 2010: Sign-up for the most inexpensive Part D drug plan that we can find. By having a Part D plan, we stay in the system, so that no future penalties are assessed. And, we get the catastrophic coverage.

    Buy our U.S.-available generics through the Part D drug plans, Costco, or Walmart, whichever is least expensive. Often we find that Costco cash is as cheap as anything.

    Buy our branded medicines through a Canadian pharmacy. If a non-U.S. generic version is available and works, we will buy it. Example: Lipitor generic. If the generic does not work, we will buy the branded version.

    Here is an example of pricing: Aciphex U.S. price is about $5/pill, with a typical co-pay of $100 and an annual Part D drug plan deductible of $300. So, an annual supply of this drug, branded, U.S. sourced, is $400 cash out of pocket, plus monthly Part D premiums. An annual supply of generic Aciphex, Canada sourced, is $200. An annual supply of branded Aciphex, Canada sourced, is $400.

    So cash out of pocket is break-even, worst case. And this example does not reflect the savings we will have because we will be able to find a cheap Part D monthly premium, compared to the monthly premium of a plan that has our formulary.

    The advantages of this plan:

    • Cost neutral, worst case.
    • No donut hole problem.
    • Order a full year supply from Canada in one fill. No need to screw around with 4 orders.
    • No formulary problems. Just pay cash to Canada and get what you want.
    • No hassles with step therapy, quantity limits, prior approval, generic versus branded you-pay-it-all, etcetera bullshit.

    I cannot tell you at this point that we have found good drugs and a good Canada supplier, but here is a website that supposedly lists prices from nothing but reputable sellers: http://www.pharmacychecker.com/ Do your own research on reputable pharmacies.

    As I said earlier, my wife and I are in the middle of doing a trial with Blue Sky Drugs. Generic Lipitor and Aciphex are on order.

    The order process is simple, simpler than ordering through a U.S. mail order pharmacy. I ordered the pills using the on-line form. At the end of the process, I received a printable fax cover sheet. I printed the cover sheet and took it to a fax facility, along with the prescription, and faxed them to Blue Sky. About an hour later, a representative called me and verified all my personal information and told me that the generic Lipitor will be shipped from Switzerland and the generic manufacturer is Cipla Pharmaceuticals (I already knew this, and had checked to make sure that Cipla is a quality supplier (in India) and they are).


    • I think this is illegal. I consider myself to be an ethical person. I feel so ripped off by the pharma companies and insurance companies that I feel no ethical dilemma over what I am doing.
    • Customs may stop the shipment. If they do, Blue Sky will re-ship. They guarantee delivery.
    • It takes time. It won't work if you have 10 pills left.

    What I expect: I think the generic Lipitor will be fine. This is an easy pill to duplicate, just like Zocor/simvastatin. My wife will go in and get a blood panel done after 90 days to verify. If there is any problem, we will go to Plan B, which will be to re-order, but specifying Brand.

    I think the generic Aciphex is dicier. The Aciphex chemical is not the problem. Aciphex has to pass through the stomach and be absorbed in the gut, so there is a special acid-resisting, time release mechanism in branded version. I am not optimistic that the generic will work well. If not, Plan B.

    Repeat after me: I'm mad as hell, and I'm not taking it anymore!! :-) Torbill

  • Yahoo! IBM Retiree Information Exchange message board: "Re: Canada Drugs" by "lederer2000". Full excerpt: I am thinking about Canada too. I take Lipitor. I see that I can get it from Blue Sky Drugs for less than the IBM plans will charge me next year. I don't even have to think about generics. How on earth can this be illegal?? What with IBM having done to us. Bill
New on the Alliance@IBM Site
  • Job Cut Reports
    • Comment 10/23/09 If you get RAed you are told you have 30 days to find something else in IBM. But I can tell you, if you are on the RA list, and you post for a job in IBM here is what happens. 1) Hiring Manager must look at resources in their group/division first; 2) Would then consider resources not on RA list outside their group/division next and then; 3) can only look at RAed employees if they can't find someone from the first 2 groups mentioned. So you can forget it - I've wasted my time looking and being interviewed (even got an offer, but internal IBM barred the transfer and now the role is filled). There are just too many internal hurdles. If you get selected, and are on the RA list, then that Manager will have to go before the RA board to get approval to let you fill the slot. It's virtually hopeless. -MyNumberIsUp-
    • Comment 10/23/09 To MyNumberIsUp.... you are absolutely right, same thing happened to me. However, I do know of one person who was able to stay..... that person has unique, very specific industry skills, is in Sales/Business Development, and makes over $200K. So much for the rest of us but I just wanted to point that out. Everyone on an RA time clock......contact Right Management who whatever firm you are given to get your resume updated. It took me weeks because I had only ever been in IBM, never had a good, commercial (outside IBM) resume. Start beefing up your contacts on LinkedIn.. because you will probably need someone on the inside to help move your resume to the right person, at the least. Don't waste time..... or, if nothing else, spend it on the recuperation period from the shock and depression you are experiencing. Everyone else...this is true. At this point you have nothing to lose if you join the union and everything to gain. When the dirt comes out on Moffatt and any others in IBM tied to him, the stock is going to drop more and they will look at more cuts. Protect yourself. Don't just JOIN the union, make it a point to make sure at least 5-10 others you work with KNOW about Alliance and get them to JOIN. That's all I have to say about THAT. -Silly Willy-
    • Comment 10/24/09 Comment 10/23/09: If you get RAed you are told you have 30 days to find something else in IBM. But I can tell you, if you are on the RA list, and you post for a job in IBM here is what happens. 1) is accurate. 2) is accurate. 3) is inaccurate. Since you were extended, you got barred for a transfer. 4) if you are not extended, and got a job offer, your current group will not bar you against the transfer. I know a guy who was RAed the same time with me on 3/27. He was not extended and was not barred against a transfer.

      It is logical for IBM to retain local talents if they can transfer head counts among the groups. I know it's hard since I could not find any offer. :) But the system is very logical. You just need to know and play along. P. S. I am curious though. Do you have an option to say, "I don't want to be extended, I want to be done 30 days from now to take my money and run (for a better job)". Will you still receive your package? Or they make you to forfeit the package if you decline the extension? Just curious, you know... -Drgunzet-

    • Comment 10/24/09 Comment 10/09/09: System x / Blade servers R&D work was moved to Taiwan, not sure how many US jobs was affected when this took place. -Zion- This is so sad. My friend and his entire site of 500 were laid off by HP earlier this year in Vancouver, WA. The designed were moved to main land China. So, it appears to me that hardware development are being off-shored to China/Taiwan, and software development are being off-shored to India. All big US companies seem to follow this pattern. The only way to find jobs is to look for the government or small companies (below 100 employees). -Drgunzet-
    • Comment 10/25/09 Q: "I want to be done 30 days from now to take my money and run (for a better job)". Will you still receive your package? Or they make you to forfeit the package if you decline the extension? A: The RA terms are set by IBM and your management. If you leave before your extension you forfeit the offered severance package since leaving before fulfilling the terms set forth in the RA package for you by IBM management was not satisfied. Leaving before the extension is up is considered voluntarily termination. -da_facts-
    • Comment 10/25/09 Indiana's human services chief says the state does not anticipate laying off any private or public caseworkers as it switches to a new welfare delivery system. (SEE THE BUT) But Anne Murphy told the State Budget Committee Friday there will be changes at call centers currently operated by an IBM Corp.-led group once the company's contract ends Dec. 14. Gov. Mitch Daniels fired IBM last week for poor service. -anon-
    • Comment 10/25/09 Have heard comments that some are being told to expect bad news at the end of year in regards to PBC. They had worked hard all year and suspect this is a way to continue the slow form of RA via 3's. Exit time for two 3's in a row is generally at end of first quarter and before start of second quarter. Anyone being told to expect bad results at end of this year and do not have a prior three should get very busy looking for a job. Once that three evaluation is given, it is almost impossible to find a job. -Young Lady-
    • Comment 10/26/09 heard last week that more U.S. & Canada ITD job roles moving into GDF Dubuque within 20 weeks. while transition / relocating to Dubuque could be an option for some. no company moving expense is being offered. hearing local Dubuque college students being hired to fill certain jobs. 200 jobs affected? -well informed-
    • Comment 10/26/09 To Young Lady, EVERYONE needs to be concerned about being RA'd. It is not just 3 performers being targeted. I was a solid 2+ and a 1 performer and still got cut. They also don't need a reason to RA someone, they just do what they want. Remember, AT WILL EMPLOYEE. -RA'd in April-
    • Comment 10/26/09 To Young Lady, first, thanks. However, I was never rated a 3, never, and still I was RA'ed. I believe that many more 2+ and 2 employees are RA'ed, than the few employees who are ever rated a 3. Is this different from your experience? -toyounglady-
    • Comment 10/27/09 I continue to receive recruiter emails regarding positions at the Dubuque GDF. The latest message lists 35 openings in Unix support alone. While pushing experienced workers out the door, it seems that IBM is having trouble hiring in new people at very low wages, even with the lowered qualifications that they are seeking. It makes me wonder if job cuts are just on hold until IBM completes staffing the GDFs. -Joe-
    • Comment 10/27/09 Hey Joe...you are so right about Dubuque. IBM is having problems hiring. We just had a few people from our group go out to train them. They don't know the products at ALL!!! They have been hired out of college. If they were able to look at the screen, could use the keyboard and mouse and were able to read they were hired. Now we are sending people from our group out to train them on the very products they will be supporting. I guess 4 months from now, IBM will consider them fully trained and lay off my department. I'm just flabbergasted that IBM wants the cheapest and youngest they can get to fill these positions, with no regard as to how they will actually get the work done. IBM deserves what it gets. This is no way to run a business. But heck what do I know, I'm one of the peons that will be fired soon after working here for over 2 decades. -dun-4-
    • Comment 10/28/09 To: -MyNumberIsUp- When I was RA'd in 07, I applied for a half dozen jobs I was well qualified for. One I got a rejection notice for, the other 5 did not even respond within the 30 days. My manager would not even bother to answer my emails for help. When you have your 30 day notice you are DONE! You are marked and nobody will touch you. The only way to be treated fairly during a layoff is to have a UNION! Otherwise, you are an "at will" employee, and they can and will do whatever they want to you at will. UNION is the only possible way to survive in this executive greedy company. -Gone_in_07-
  • General Visitor's Comment page
    • Comment 10/23/09 To The Alliance@IBM/CWA Local 1701, I am a Member of your site and I want you to know that I do not believe in the way you are handling the Moffat issue in the press. IBM has done a lot of people wrong and yes, the offshoring of jobs without taking employees into account is wrong, however, the use of one single Exec's bad actions to make your point is also wrong. Your press releases regarding this will almost certainly backfire and makes us IBM employees look spiteful and like whiners. Please get off this"Moffat" soap box, let's let the facts speak for them selves in this matter. Let's not stoop to tactics that make us look in a bad light, to much like the PR Spin that IBM uses for off-shoring of jobs. Thanks. An IBM employee that is a Dues paying member -Stan-

      Alliance reply: Stan thanks for sharing your opinion. As you are probably aware, opinion on this falls on both sides. Many members and employees believe this is an exec that got caught and that other executives are "probably" doing the same type of unethical or "possibly" illegal actions. We have received emails from employees and ex-employees who have raised some interesting allegations. We have chosen not to post what we received because they are unproven. It is also clear that the "fear" that many employees report, feel working in IBM, come from the executives lack of respect or empathy for what employees are going through. Hopefully this will be a wake up call for them, but if there is corruption at the highest levels of IBM, then those executives must go and be replaced by executives who value success of the company and the employees over success in their bank accounts. We didn't post the call to investigate lightly, and are fully aware of the ramifications. We believe it is time to question the direction the executives are going and where they are taking the company.

    • Comment 10/23/09 Everyone who is wondering if Moffat is getting paid or will get his pension or anything else. Care about something that matters. Are you getting paid and are you getting your pension. If the answer to any of the questions you have about Moffat regarding yourself is no then what are YOU doing about YOUR situation. If Moffat is not getting paid leave did that give YOU more income? If Moffat gets his pension or not, does it restore YOUR full pension? Do any of his problems solve any of yours? Denying him EVERYTHING ,as self satisfying for people who got screwed by him in IBM may find it ,does not improve your lot at all. Only by organizing and forming a labor union and getting contracts that define YOUR job, YOUR rate of compensation, YOUR retirement benefits, YOUR medical coverage, YOUR job security can you improve your lot in life. Do not waste cycles hoping to see IBM executives bloody one of their own. It will probably never happen. Use that energy to organize for your own sakes. Stop this madness of RA's and overwork with undercompensation. -Exodus2007-
    • Comment 10/23/09 Saw elsewhere that Moffat and Palmisano made large IBM stock trades on August 21, 2008. Then Palmisano did it again on August 28, 2008. If this is correct, calls for Sam's investigation seem warranted! -Rob-
    • Comment 10/23/09 By the Looks of the dates on this trading report: http://finance.yahoo.com/q/it?s=IBM It is obvious that other exec's besides Moffat have utilized trading info. too optimize and benefit their return payment/return stock investments. -Selling the Company Store short!-
    • Comment 10/23/09 In reply to an earlier post re: the Moffat scandal, the Alliance reply included this insightful statement: "We believe it is time to question the direction the executives are going and where they are taking the company." As a former, 20+ year IBMer I agree wholeheartedly, and suggest anyone who doubts employees are not being respected, or who doubts that IBM's senior executives are simply out for themselves -- just take a moment to read the latest reviews of IBM at http://www.jobvent.com/companyBrowse.php?CompanyID=21 The telling reviews submitted over the past month include comments like the following (I pulled just one line from each posting for your reading pleasure):
      • [IBM] has lost any sense of decency or respect for the individual.
      • I did great work there but got no respect from managers.
      • IBM has lost all of their respect for the individual.
      • IBM treats employees like disposables.
      • IBM treats it's employees so poorly that it boggles the mind why anyone would choose to stay.
      • Very little respect or support from management.
      • The first line managers have become face-less drones on the other end of a telephone.
      • The executives seem so focused on financial trickery in order to achieve their bonuses that they continually drain the company of it's true resources instead of truly leading the way into the future.
      • I am a new college hire and already hating this monstrous company.
      • I'm very glad that people are speaking out about this evil company.

      I fully agree that it is high time all remaining IBMers unionize against the tyranny being perpetrated on IBM employees and IBM customers by IBM executives who are deeply steeped in insatiable greed. We have laws against rape in this country, however, it's very unfortunate that senior executives can do the same thing to a once great company, and do so with impunity (from the Latin"impunitas," meaning "without punishment"). I am convinced that a unionized IBM workforce is the only hope for IBM -- for without a union the senior executive team will continue to rape and plunder IBM at the expense of IBM's employees and customers, leaving behind a wasteland no one will want to work in. So if you value your job, and you have any respect for the IBM that once was, then rally behind the union and help keep IBM from going off the edge of the precipice it is already teetering on. -Glad2BeGone-

    • Comment 10/25/09 Phase 1 of selling off the BTV site: http://www.wcax.com/Global/story.asp?S=11332156 General Dynamics will occupy a one of the Williston IBM buildings. IBM is trying to keep this news very quiet. IBM does not want it covered in the press. The truth is that IBM wants out of Burlington and Williston. If you are working in Burlington and want to stay with IBM you better arrange your transfer to East Fishkill, NY. IBM Burlington days are numbered. -BTVer-
    • Comment 10/27/09 Medical Benefits for 2010 increased another 30% per the package I received today. If this is the best that randy McDonald can do in holding down health care costs, then he needs to be fired. Have seen similar increases every year that he's been there. Almost beginning to feel like he either works for the Health Insurance Industry or could he be involved in insider trading of Health Care Stocks. -Anonymous-
    • Comment 10/28/09 As for health care premiums, Randy probably *is* negotiating, but is passing a greater percentage of the cost to employees and even more to retirees. I'd almost bet that IBM's expenditures toward employee health insurance premiums are going down because of these negotiations, a reduction in the number of US employees and because they can claim a younger average employee age. Just the opposite for retirees, obviously, who are increasing in number and age. I'd imagine IBM is also capitalizing on all the press reports that say health insurance costs are on the rise....and therefore everyone should expect an increase. -Think- Alliance reply: And without union negotiating rights or a contract there is no one negotiating for employees.
    • Comment 10/30/09 Sam says, "our strong cash flow performance has enabled IBM to return $73bn" in dividends. Isn't that roughly the same amount they stole from the pension plan? That didn't take any management skill worth paying for. -SAM-
    • Comment 10/31/09 What SAM says does not matter. Notice that a Senior Vice President and the future CEO of IBM gets arrested for insider trading and Wall Street does not blink. The Government does not blink. Stock prices do not fall. The street does not " Punish " IBM. The Government will still award Sammy some of the porkulus money for phony smart grid technology and the screwing of you and I will continue with gusto.

      Buffalo Bill Cody explained that when hunting Buffalo you shoot the rear most Buffalo first. The ones in front never notice so they just stand there and do nothing while you shoot the next and so on. With a little repositioning you can shoot the whole herd and they never try to run. I guess it works the same way with IBMers. When will the herd wake up?? Organize before its too late people. One by one your falling and no one but the hunters seem to notice. Remember, when you are the only Buffalo left, you may very well be the first but you are also the last and the next bullet from managements' rifle will certainly be yours.-Exodus2007-

  • Pension Comments page
  • Raise and Salary Comments IBM CEO Sam Palmisano: "I am pleased to announce that we will not only be paying bonuses to IBMers worldwide, based on individual performance, but that they'll be funded from a pool of money nearly the same size as last year's. That's significant in this economy -- and especially so, given the size of the 2007 pool. Further, our salary increase plan will continue, covering about 60 percent of our workforce. As always, increases will go to our highest performers and contributors. We should all feel good about the company's ability to invest in people in these very concrete ways."
    • Comment 10/27/09: Salary = 62,250; #Yrs Since Raise = 1; %Raise = 1.9; Band Level = 7; This Yr-PBC = 2; Job Title = IT Architect; Years Service = 10; Hours/Week = 40; Div Name = BTE; Location = Boulder; Message = I stopped hammering out 47 hours a week, now I only put in 40 hours and stop. It was hard to do at first, but it sure feels nice to work a normal schedule. -Yoda's-Kin-
    • Comment 10/28/09: -Yoda's-Kin-, hah, your working 40 hours, you're getting screwed -Under40ForSammy-
  • PBC Comments
    • Comment 10/15/09: More of you will get a PBC 3 this year. More of you will be downgraded to a PBC 2 this year too. IBM makes more profits this way. It is as sure as the sun rises each day. IBM needs to do all it can to get to that magic EPS since Sam and some of his cronies only have a few years till retirement to ca$h in his stock awards and bonuses to retire more than greedily filthy rich on the backs of thousands of those economically abused employees, RA'ed, forced out to premature retirement, etc. and Sam and his cronies don't want to blow it now in their pre-golden stretch run. -anonymous-
    • Comment 10/26/09: A big push is being made for us to complete our PBC results by first of Nov. I guess I can take off the last two months since it won't matter. Any other areas being pushed to get PBCs done almost 2 months earlier than usual??? -It's that time of year-
    • Comment 10/27/09: -Its that time of year- The push is more like a shove. IBM will be making more PBC 3's this year. Those folks slated for and stuck with a 3 will be gone either by year end or early 2010. -anonymous-
    • Comment 10/27/09: Band Level = 08; Years Service = 25.43; Prior Yr PBC = 2+; This Yr PBC = 2+; Message = Yes, not only PBC 3's get RA'ed, not only PBC 2's get RA'ed as well, but PBC 2+ sure get cut loose as well. If by chance you were a PBC 2+ and got no raise this year don't be surprised if you are RA'ed before 12/31/09. -sby_willie-
    • Comment 10/28/09: Band Level = 6; Years Service = 4; Prior Yr PBC = 2+; This Yr PBC = 2+; This Yr Bonus = 1000; Prior Yr Bonus = 1000; Message = Everyone in my group gets the same bonus (2%), the same raise (1%) and the same PBC (2+). Manager doesn't give a rats' rear. She just gives everyone the same scores/money just to avoid conflict. Upper management lets her get away with it because they'd love to replace us with contractors and temps. We were told in a team meeting that they are going to have a more 2s and 3s this year. Was told that to get a 1, I'd have to "walk on water" and that my manager would have to present my case to the site executive. -Daksh Waterboy-
  • International Comments
News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
  • New York Times: Small Business Faces Sharp Rise in Costs of Health Care. By Reed Abelson. Excerpts: As Congress nears votes on legislation that would overhaul the health care system, many small businesses say they are facing the steepest rise in insurance premiums they have seen in recent years. Insurance brokers and benefits consultants say their small business clients are seeing premiums go up an average of about 15 percent for the coming year — double the rate of last year's increases. That would mean an annual premium that was $4,500 per employee in 2008 and $4,800 this year would rise to $5,500 in 2010. ...

    The House speaker, Nancy Pelosi of California, said the sharp rise in premiums for small businesses offered the latest evidence that Congress must act swiftly on health care legislation. “This underlines the urgent need for health insurance reform, including a public option,” she said in an interview. “We need to have competition for the insurance companies to keep premiums down.”

    Insurers say there is no need for a government-run insurance plan and argue that their health plans are already responsible for many of the initiatives, like programs to coordinate care for chronic conditions, that ultimately lower costs. Insurers' “profits are not responsible for increased health care costs,” said Robert Zirkelbach, a spokesman for the industry's trade group, America's Health Insurance Plans.

  • Washington Post: New life for the public option. By Dan Balz. Excerpt: The resurrection of the public option is the latest and one of the most surprising turns in the long battle over legislation to overhaul the nation's health-care system. Under assault for months, and declared on life support repeatedly in recent weeks, the provision for a public insurance option is unexpectedly alive as House and Senate leaders prepare to send their bills to the floor. That doesn't mean it's a done deal. Whether it survives the final battles, and in what form, are still the unanswerable questions. Multiple versions of a public option are on the table. Liberal and moderate Democrats are still at odds and are drawing lines in the sand in hopes of exercising maximum influence on the outcome.
  • VideoCafe: Anthony Weiner Points Out the Hypocrisy of Members of Congress on Medicare but Against the Public Option. By Heather Sunday. Excerpts: Rep. Anthony Weiner's (D-NY) office today released an internal study showing that 151 members of Congress “currently receive government-funded; government-administered single-payer health care — Medicare.” Of those 151 members, 55 are Republicans who also happen to be “steadfastly opposed [to] other Americans getting the public option, like the one they have chosen.” Included on Weiner's list are anti-public option crusaders Senate Minority Leader Mitch McConnell (R-KY), Sen. Chuck Grassley (R-IA), Sen. Jon Kyl (R-AZ), Sen. John McCain (R-AZ), Sen. Orin Hatch (R-UT), Sen. Richard Shelby (R-AL), Sen. James Inhofe (R-OK), Sen. Mike Enzi (R-WY), Rep. Virginia Foxx (R-NC), and Rep. Peter King (R-NY). ...

    And why not have that type of a system that has lower overhead, lower costs and you don't have to deal with the 30% of profits and overhead that insurance companies take. So we compiled this list largely to point a bright light on some of the hypocrisy of this debate, but also I hope it gets people thinking—if Medicare is good enough for 151 members of Congress, why shouldn't a program like it be created for those who want to go out and buy insurance?

  • New York Times op-ed: After Reform Passes. By Paul Krugman. Excerpts: So, how well will health reform work after it passes? There's a part of me that can't believe I'm asking that question. After all, serious health reform has long seemed like an impossible dream. And it could yet go all wrong. But the teabaggers have come and gone, as have the cries of “death panels” and the demonstrations by Medicare recipients demanding that the government stay out of health care. And reform is still on track. Right now it looks highly likely that Congress will, indeed, send a health care bill to the president's desk. Then what? ...

    Like the bill that will probably emerge from Congress, the Massachusetts reform mainly relies on a combination of regulation and subsidies to chivy a mostly private system into providing near-universal coverage. It is, to be frank, a bit of a Rube Goldberg device — a complicated way of achieving something that could have been done much more simply with a Medicare-type program. Yet it has gone a long way toward achieving the goal of health insurance for all, although it's not quite there: according to state estimates, only 2.6 percent of residents remain uninsured. ...

    So national reform's chances will be better if it contains elements lacking in Massachusetts — in particular, a real public option to keep insurers honest (and fend off charges that the individual mandate is just an insurance-industry profit grab). We can only hope that reports that the Obama administration is trying to block a public option are overblown.

    Still, if the Massachusetts experience is any guide, health care reform will have broad public support once it's in place and the scare stories are proved false. The new health care system will be criticized; people will demand changes and improvements; but only a small minority will want reform reversed. This thing is going to work.

  • Yahoo! IBM Retiree Issues message board: "Not many options" by "lrafalow". Full excerpt: The costs associated with the health insurance reform bills are, for the most part, the cost of subsidies to move toward universal coverage. (We are the only developed economy in the world that doesn't insure everyone and there's little debate about the goal of universal coverage.) The insurance industry has said that the Senate Finance Committee bill would raise premiums dramatically...and there's no "public option" in that bill. Their objection to that bill is largely that "mandate" isn't strong enough to expand their market--and their profits--like they'd hoped.

    So, if you think that people who can't afford insurance should go without health care (or more correctly, go without adequate health care and what health care they do get is the most expensive and least effective kind offered by hospital emergency rooms at our expense) then you're at least marginally consistent in your views about the costs and the goal.

    But if you're opposed to the "government run" public option because it'll cost the taxpayers too much money or the government just can't do anything well, that's just plain wrong. The public option is--as has been said--a way to reduce the costs in the system largely by having a competing program that doesn't waste 25-30% of the insurance dollar on profits, huge bonuses and, mostly, administrative overhead. Medicare has no profit and its administrative overhead is in the range of 3%. It should have a slightly higher admin overhead to do a better job of addressing fraud. Anyway, the subsidy costs will be paid for those under various income levels depending on which bill you're examining regardless of the individual CHOICE of public or private insurance. (BTW, the NCPA is "nonpartisan" but with a decidedly conservative bias.)

    Insurance, by definition, is a redistribution of income from those who have it to those who need it, e.g., you pay fire insurance so someone--perhaps you--can have the money if they need it. So let's dispense with the nonsense and agree that we all--or almost all--believe in the idea of insurance which is redistribution of income. The only issues at hand are (1) how do we get the most cost-effective system and, a separate issue, (2) who will participate in the pool and with how much help from the taxpayers. The costs are associated with #2; the savings are associated with #1.

    BTW, there's a terrific new ad with Heather Graham as the "public option" coming to a media market near you: http://www.youtube.com/watch?v=ju8LZkkQgGM&feature=channel. My two cents.

    P.S. If you hate public health insurance, are you not using your medicare benefits? It's ironic that some of the most ardent defenders of private insurance companies are on the public insurance plan called Medicare. Which, BTW, is in financial difficulty not because it's public--as I said, its overhead is far lower than private insurance--but because of the subsidies to private insurers for Medicare Advantage programs and subsidies to those senior citizens who didn't pay enough during their working life (their premiums) to pay for their expenses.

  • Washington Post: AARP: Reform advocate and insurance salesman. Seniors group makes millions from royalties on health plans. By Dan Eggen. Excerpts: The nation's preeminent seniors group, AARP, has put the weight of its 40 million members behind health-care reform, saying many of the proposals will lower costs and increase the quality of care for older Americans. But not advertised in this lobbying campaign have been the group's substantial earnings from insurance royalties and the potential benefits that could come its way from many of the reform proposals.

    The group and its subsidiaries collected more than $650 million in royalties and other fees last year from the sale of insurance policies, credit cards and other products that carry the AARP name, accounting for the majority of its $1.14 billion in revenue, according to federal tax records. It does not directly sell insurance policies but lends its name to plans in exchange for a tax-exempt cut of the premiums.

  • California Nurses Association: Insurers' Black Box. By Scot J. Paltrow. Excerpts: Now-Secret Claims Denial Rates Could Tell Consumers a Lot About Their Insurance Company. Claims data showing wide variations between companies in rejection rates, or that an insurer greatly increased claims rejections from one year to the next, could be an alarm for regulators to investigate. Key points.
    • The rate at which insurance companies deny claims is critical for consumers to know when shopping for insurance—but today insurance companies are keeping those rates secret.
    • Claims denial rates have been released in only one state—California—and the data shows dramatic variations in denial rates among companies, which one expert says should raise an alarm for regulators.
    • When it comes to claim denials, insurers may be putting profits ahead of patients' best interests. Most major insurance companies have reassigned their medical directors—the doctors who approve or deny claims for medical reasons—to report to their business managers, whose main responsibility is to boost profits.
  • Yahoo! IBM Pension and Retiree Issues message board: "Re: Employees face "shockingly higher" health costs" by "ibmmike2006". Full excerpt: Wow, This is in line with the shift from employers to employees of the group health plans. In 1990, the average family of four paid $3000 for health insurance, today, with the compounding of 10% annually, it is over $17,000 a year. If the 10% annual costs are not stopped, in 7 years, the cost of health plans will be nearly $30,000 annually. There are 900,000 FAMILIES that declare bankruptcy every year and over 60% have health insurance. That is one out of 100 families in your town, each year, file bankruptcy for medical reasons. These families don't talk about it, and you will rarely know who they are.

    I found out my sister, in her 60s' had to declare bankruptcy to pay off $750,000 in medical bills above the $250,000 Cap. She was a public employee in Nevada with supposedly good health benefits. All their savings like IRA's were eaten away by the bankruptcy when her husband had major surgeries over a five year period. The only income they have is their Defined Benefit pensions with a COLA, protected by a Union, of 75% of their final salaries working for the state of Nevada.

    Thank goodness for their Defined Benefit plans with a COLA, otherwise, they would be working till they die. Pray that you get to age 65 before any health issues and are eligible for the government run socialistic Medicare health plan. We are all "one major illness away from bankruptcy" with our "For Profit Health Care system.

  • New York Times op-ed: The Defining Moment. By Paul Krugman. Excerpts: O.K., folks, this is it. It's the defining moment for health care reform. Past efforts to give Americans what citizens of every other advanced nation already have — guaranteed access to essential care — have ended not with a bang, but with a whimper, usually dying in committee without ever making it to a vote. But this time, broadly similar health-care bills have made it through multiple committees in both houses of Congress. And on Thursday, Nancy Pelosi, the speaker of the House, unveiled the legislation that she will send to the House floor, where it will almost surely pass. It's not a perfect bill, by a long shot, but it's a much stronger bill than almost anyone expected to emerge even a few weeks ago. And it would lead to near-universal coverage. ...

    The people who really have to make up their minds, then, are those in between, the self-proclaimed centrists. The odd thing about this group is that while its members are clearly uncomfortable with the idea of passing health care reform, they're having a hard time explaining exactly what their problem is. Or to be more precise and less polite, they have been attacking proposed legislation for doing things it doesn't and for not doing things it does.

    Thus, Senator Joseph Lieberman of Connecticut says, “I want to be able to vote for a health bill, but my top concern is the deficit.” That would be a serious objection to the proposals currently on the table if they would, in fact, increase the deficit. But they wouldn't, at least according to the Congressional Budget Office, which estimates that the House bill, in particular, would actually reduce the deficit by $100 billion over the next decade.

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.

  • Jim Hightower: Let's Help Gladman Sachs Get a Clue. Full excerpt: Bankers at Goldman Sachs have a problem and I'm sure you can empathize. Maybe you can even help them! Here's the problem: They're making too much money. Altogether now: Awwww.

    The Wall Street colossus has set aside nearly $17 billion to pay end-of-year bonuses to its bankers, with the biggest chunk going to top executives and the casino dealers in Goldman's trading department, where exotic, high-risk betting games are played.

    Yes, these are the same financial whizzes whose exotic investments turned toxic last year, crashing America's real economy and hurting millions of regular folks who weren't in on the game. Indeed Goldman remains in the game today only because it was bailed out with our tax money – Goldman got $22.9 billion in cash from us, plus many billions more in cheap federal loans and government guarantees. With this public support, the bankers can now lavish bonuses on themselves.

    So, you see, their problem is one of public perception: they are widely viewed as immoral, greedy banksters. This perception hurts their feelings, so to buff their image the ruling poobahs at Goldman have announced that the bank will magnanimously donate $200 million to the bank's own charitable foundation, hoping that you and I will applaud this generosity and show them some love.

    Generosity? Two hundred million is less than two percent of the bonus money they're grabbing! They think that's going to win us over? Let's help them out. What do you think these clueless narcissists could do to earn any real appreciation from the American people? Send your ideas to info@jimhightower.com, and we'll forward them to Goldman's CEO. We'll also select the three best ideas, with the winners getting a free one-year subscription to the Hightower Lowdown monthly newsletter.

  • Jim Hightower: Investors Get Theirs, Workers Get Stiffed. Full excerpt: Because of lost jobs and falling wages, millions of Americans find themselves falling into debt – and learning that debt can be a vicious master. They're not alone, for many companies are also struggling with debt. Hinkley Yachts, a longtime boat builder in Maine, is not a company you'd expect to be in trouble. It constructs boats for America's Rockefellers – literally! Hinkley is presently building a $3 million power boat for David Rockefeller.

    Hinkley's fortunes flow with those of the moneyed elites who always seem to do well. So, why is this respected, 80-year-old firm foundering? Debt. Not debt caused by its own spending – indeed, the family-owned enterprise has always been financially cautious. But that responsible ethic changed a dozen years ago when Hinkley was bought out by Bain Willard, a private equity outfit based in Boston.

    Private equity firms are roving speculators that borrow huge sums of money to take over a business, squeeze the operation, then flip it to another buyer for a fat profit. Thus, Hinkley was burdened with heavy interest payments that had to be paid on the money that Bain Willard borrowed to buy it.

    Sure enough, a year later, Bain Willard sold a majority share of Hinkley to another equity outfit that paid double the original purchase price – again with borrowed money, stacking even more debt on the boat builder's deck. Then, with Wall Street's collapse, sales slipped. Still, Hinkley could've weathered the storm – but, it had those big debt payments pulling it down.

    The corporate owner has now cut Hinkley's workforce in half, so it can keep making those debt payments. Three hundred skilled get stiffed, faraway rich investors get paid. And now, 300 local families face debt problems of their own – on their own. As one longtime employee said after getting her pink slip in July, "We have suffered from a double impact: the economic downturn and corporate greed!"

  • BusinessWeek: Dousing the Passion for Greed. Companies would do well to take a page from Whole Foods, which limits executive pay to no more than 19 times the average worker wage. By Alaina Love. Excerpts: In the next few days, the Treasury Dept. is expected to deliver a strong message about the true meaning of pay for performance when it announces drastic executive compensation reductions for the top brass of bailed-out companies. And it's about time. For years we've witnessed supposed leaders guide their companies to uncharted depths while not taking real responsibility for their decisions where it matters most—in their own pockets. Meanwhile some corporate boards have stood idly, not holding CEOs accountable. This behavior is an insult to the privilege of leadership that other corporate executives take seriously. ...

    At the risk of being called a socialist, which seems to be a popular maligning label these days, let me remind readers that the government funds that have bailed out the seven failing companies affected by the Fed action is our money—hard-earned taxpayer dollars. We have a right to expect to get value for our money, which means paying for responsible leadership. Yes, we are required to pay. So, where can Washington turn to for good ideas?

    There are reasonable executive compensation programs in practice that can serve as a model for a better mousetrap. Take a look at Whole Foods (WFMI) as one example. Its senior executives' pay is limited to no more than 19 times the average worker wage, and it's built a transparent performance model where each employee has access to compensation data for every other colleague. Teams understand their own responsibilities and those of other teams, and performance data is shared throughout the organization. This is accountability in action. Are Whole Foods' leaders just smarter than everyone else? Perhaps. It is more likely that they are driven by a leadership belief system that welcomes responsibility along with reward. In the decades that I've worked with leaders, some fundamental tenets have guided the behaviors of the best among them. These are deeply held operating principles that it might serve us well to revisit as we move forward in this still-challenging economy:...

  • eWeek: H-1B Visa Scam Investigation Digs Up Dirt. By Don E. Sears. Excerpt: A two-and-a-half-year investigation yields one of the most bizarre cases of alleged visa fraud in the history of California. Fictitious companies for H-1B visas? Check. Exploitation of immigrants? Check. Money laundering via cemetery plots? Oh, indeed.
If you hire good people and treat them well, they will try to do a good job. They will stimulate one another by their vigor and example. They will set a fast pace for themselves. Then if they are well led and occasionally inspired, if they understand what the company is trying to do and know they will share in its sucess, they will contribute in a major way. The customer will get the superior service he is looking for. The result is profit to customers, employees, and to stcckholders. —Thomas J. Watson, Jr., from A Business and Its Beliefs: The Ideas That Helped Build IBM.

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