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6, 2000 April, 2000

Highlights—August 7, 2010

  • BBC News: IBM in pension change legal fight from ex-employees. Excerpts: IBM is facing legal action from 250 ex-employees who claim they were "forced" to take early retirement before changes to the pension scheme. The action is being taken by former workers across the UK, including many at the head office in Portsmouth.

    They used to be able to retire early, losing 3% of their annual pension for each year before 60, but the new scheme now sees 6% lost each year before 63.

    IBM said its changes were legal and it will contest any action.

    Under the old scheme if an employee with an annual pension of £40,000 retired at 55 they would sacrifice £6,000 (15%) over the five years before their 60th birthday.

    But under the new scheme the same person would sacrifice £19,200 (48%) over eight years, from their annual pension.

    The employees are claiming unfair dismissal and age discrimination. Their solicitors, Now Legal based in Fareham, Hampshire, claim they were effectively forced to take early retirement to avoid the new terms which would mean losing "substantial proportion" of their future pensions. The firm added that because the changes impacted on long-serving employees, who are all aged in their 50s, a claim for age discrimination would also be pursued. ...

    IBM, which said it will fight any action, added: "Throughout the process of changes to IBM defined benefit pension plans - and the introduction of a new early retirement programme - IBM has consulted with relevant employees and complied with all legal requirements. "Claimants left IBM of their own volition, on favourable early retirement terms. "Thus, we will contest these actions, which are without merit."

  • BBC News: IBM faces two competition probes. Excerpt: The European Commission has launched two competition inquiries to study whether IBM has abused its dominant position in mainframe computers. One probe follows complaints by two software makers, T3 and Turbo Hercules. The study will examine whether IBM has put obstacles in place that prevent competitors from operating freely. IBM says the claims have no merit. The other inquiry, launched by the Commission itself, will look at IBM's relations with maintenance suppliers.
  • When Fridays Were Fridays: The Case of the Disappearing Pension. By Colette Martin. Excerpts: In 1975 Jack started working for a large US Corporation. “You’ll have great benefits,” his parents said. “As long as you do a good job, you’ll never have to worry,” his new boss said.

    Making the decision to accept the job was easy. Jack was really pleased to be working for a company that was the leader in its industry, and was known for taking care of its employees. In fact, on his first day, he learned that, “Respect for the Individual,” was one of the company’s core values.

    Jack set out to be the best employee he could be, always striving to do excellent work, and believing that if he did his best, the company would take care of him. He planned to work for thirty or thirty-five years, and then take an early retirement. “Why not?” he thought, the pension plan was designed to allow him a nice bump in those later years of his career.

    As the years went on, Jack felt some pressure to put in more hours, and saw some years where he got an evaluation that was less than he expected, and sometimes he even had to go twenty-four months without a raise. But he loved his job, and he believed that his boss would take care of him.

    In the early eighties when his employer offered a tax-deferred savings plan he took advantage of it, but only up to the employer match. He didn’t feel the need to put in the full amount allowed by law – after all, his monthly pension checks should replace about 75% of salary when he retires.

    Then in the mid-nineties Jack’s company announced a change to the pension plan. Employees who were within five years of eligibility for retirement remained on the old plan, but everyone else saw a significant change to the pension plan. That nice bump Jack was expecting in his later years disappeared. He would only get about 65% of his salary in retirement.

    Now in his early forties, Jack increased his 401K contributions to make up for the loss. Despite seeing many friends and colleagues let go in resource actions, Jack still trusted that the company was doing the right thing, and he remained tremendously loyal to the company.

    In the late nineties, the company did something Jack thought he’d never see – they announced that anyone who wasn’t already forty years old would be shifted from the existing defined benefit pension plan to a cash balance plan. Jack’s colleague Jill missed the age cut-off by just one month. She would be lucky to get half of what she expected to get when she first joined the company. It was the first time Jack was happy about his age – at least he was still taken care of.

    Jack was now maxing out his 401K contributions, and even took advantage of the additional amount he could set aside when he turned fifty, but retiring at age fifty-five now seemed out of the question.

    The company announced more changes in the mid-2000’s, this time primarily affecting older workers like Jack. Employees were told that their pensions would be frozen. This meant that Jack’s pension would no longer accrue additional value. The last few years he worked up to that point would be the final years used to decide what his pension payout would be, regardless of how many more years he worked or whether he got another salary increase. Jack’s expected pension value at retirement was now less than half of what he thought he’d get when he first started working for the company thirty years earlier. Even if he worked to age sixty-five, it was impossible to make up what he had lost.

    The company tried to lessen the blow by agreeing to put in additional contributions to Jack’s 401K plan for the next few years, but before he could take advantage of that benefit, Jack found himself caught up in a resource action, and forced to take early retirement with less-than-adequate pension and retirement savings. ...

    The Boston College Center for Retirement Research estimates that the number of employees covered by a defined benefit retirement plan (the ones we think of as traditional pension plans) declined from 62% in 1983 to 17% in 2007. Especially badly hit are those who started working in the seventies and early eighties (who were in their mid-thirties to late forties when changes to traditional pensions started to occur). Many of these employees started working before tax-deferred savings plans were introduced, and joined Corporate America when the fairy-tale that their employers would take care of them was still real.

    Selected reader comments concerning this article follow:

    • I worked for the same company as Jack....with a different ending. I was laid off just before my 50th birthday, after 24 years with that company....even before the pension freeze.The defined benefit plan was designed for participants' greatest annuity growth to occur in the final years. Cutting an employee off, however it was done, in those final years meant a significant loss of planned and promised income. It's hard to believe that preferentially laying off or selling off older employees, attempting the proposed cash balance conversion and freezing the plan are not considered to be age-discriminatory by the courts. Unfortunately, our government and elected officials are heavily influenced by large corporations whose only interests are based on short-term results.
    • Jack? I thought you were talking about me! But, I was less than 4 months away from my 54th birthday and so I missed the 1 year bridge to retirement (to age 55 in my case) when they laid me off. Therefore, I missed the bump in my pension (at 55 or 30 yrs) even though pension contributions ended in 2007.

      According to my calculations I lost 30% of my pension and, of course, I lost the piddly retirement medical benefit. But 30%, that really hurts, and it really hurts that a company that did use to "respect the individual (employee)" just throws them away now so the CEO and execs can get a great bonus! (Yeah, sounds really great for the company overall, huh?)

      (I figure the big push to layoff and offshore is because the company is exceeding their 5 year goal of 10% EPS by this year, which I expect means BIG bonuses for those at the top.)

      I think this particular company should be stripped of its name. I imagine that the company's founders would want that. The company they created and worked so hard for is gone now

    • When I was hired, the recruiter said: No guarantees of course (wink wink) but we've never laid anyone off! You have job security here. The problem is not just that we ended up with a smaller pension than expected and no job. It's that we were told we could count on them. It's a hard blow to readjust your thinking.

      So okay, I'm employed again now in a completely different field which carries absolutely no pension options. I make just enough to live and enjoy myself on and I'm happy about it because I'm loving my work and travel. No one else around me has a pension either, and they're not worrying about it. Of course, it's also the norm here in Indonesia that extended families take care of their parents/relatives for life. I think if we're going to get rid of pensions as a norm, we'll need to return to that expectation - that we may need to be financially supported by our families in our old age. As usual, those caught in the middle of change miss out on both ends - we have the lower pension but our kids weren't expecting to support us. And we don't want them to - we want our independence.

      I agree that company loyalty has gone - I had pretty much lost almost all of mine before I was laid off. But it's the change that's hard; they hired us with promises and they broke those promises. Perhaps they had to, although perhaps not. That's right - it's everyone for him or herself - but I can't blame people for being bitter about the let-down.

  • LinkedIn: The Greater IBM Connection. Full excerpt: I have been following the IBM and IBM Global Services in Linkedin. Over the past 1 month or so, the number of people who have quit IBM are more than double the promotions or new hires. I know not all IBM employees follow Linkedin. But if we take this as a representative sample, the trend is very concerning. Is this something that occurs every year around this time (Promo / Sal hike time) or this is a new pattern this year?

    Selected comments follow:

    • I left because it is a place that promotes mediocrity and punishes those who can make a difference. It's the peter principle labs. Unless you enjoy the crappy hours and pay all for the sake of wearing an IBM badge, leaving is the best option.
    • I'm sure many in the group here follow the comments on the IBM Alliance comments board...IBM has been laying off anywhere from 8000 to 10000 a year in the US and hiring almost twice that overseas, consistently for the past 5 years. So your observation is correct.
    • I resigned in 2004 after being moved to AT&T. They treated IBM employees like garbage and the deal was done on a handshake. IBM became my client and all they did was have turf wars with AT&T. Customers such as ALLstate Ins were leaving the network. I did notice many IBMers as well as AT&Ters being downsized. After I left many departments went to India as OUTSOURCED and I can recall the manager of that dept. having to go to India and teach them the job mission then being laid off. No package was offered to go to AT&T. If you didn't go they said "goodbye" with some small amount of pocket change.

  • InformationWeek: U.S. To Train 3,000 Offshore IT Workers. Federally-backed program aims to help outsourcers in South Asia become more fluent in areas like Java programming—and the English language. By Paul McDougall. Excerpts: Despite President Obama's pledge to retain more hi-tech jobs in the U.S., a federal agency run by a hand-picked Obama appointee has launched a $36 million program to train workers, including 3,000 specialists in IT and related functions, in South Asia.

    Following their training, the tech workers will be placed with outsourcing vendors in the region that provide offshore IT and business services to American companies looking to take advantage of the Asian subcontinent's low labor costs.

    Under director Rajiv Shah, the United States Agency for International Development will partner with private outsourcers in Sri Lanka to teach workers there advanced IT skills like Enterprise Java (Java EE) programming, as well as skills in business process outsourcing and call center support. USAID will also help the trainees brush up on their English language proficiency. ...

    But it's the outsourcing program that's sure to draw the most fire from critics. While Obama acknowledged that occupations such as garment making don't add much value to the U.S. economy, he argued relentlessly during his presidential run that lawmakers needed to do more to keep hi-tech jobs in IT, biological sciences, and green energy in the country. He also accused the Bush administration of creating tax loopholes that made it easier for U.S. companies to place work offshore in low-cost countries.

    As recently as Monday, Obama, speaking at a Democratic fundraiser in Atlanta, boasted about his efforts to reduce offshoring. The President said he's implemented "a plan that’s focused on making our middle class more secure and our country more competitive in the long run -- so that the jobs and industries of the future aren’t all going to China and India, but are being created right here in the United States of America."

    Selected reader comments to this article follow:

    • Training of people outside our country when we have a large supply of out of work professionals that are especially well trained and are very adept at doing this work, is not in the best interests of this country and I for one believe we should get these jobs and the rest of the outsourced jobs back here for our people. Why are we training competitive interests to compete with our own people? We would lower our unemployment rate and improve our economic picture greatly if we demanded that American companies would utilize our people instead of assisting other countries to profit from our economic downturn..
    • I smell some lobbying, as I see no rational reason for the US government to help US corporations move jobs offshore. If US citizens and corporations want to operate in foreign countries, that's their privilege, but they should do so entirely at their own expense and risk.
    • We're going broke and they're spending $22 million to train ANOTHER country's workforce. That's worse than the U.S. taxpayers bailing out the bankers!
    • The best way to succeed in a war is to divide and conquer. It has always worked and it is working right now in America. The cause of this kind of selling out of American jobs is coming from Corporate America. The race to obscene profits is what is driving this. By buying our legislators, both Democratic AND Republican, and pushing through this kind of program, they continue to be able to hire workers to compete against Americans in ways that cannot allow Americans to get the job. STOP focusing on the darned parties and start focusing on the elected people of BOTH sides. We will not end this until we demand their heads on a platter.
    • Having been a victim of outsourcing TWICE now, I find this funding to be not only absurd but a slap in the face to the American workers. In late 2008, the credit card company I was working for hired dozens of IT workers in Singapore and actually opened a work center there. Once they were "trained up", the layoffs of the American workers began, continuing throughout 2009 and I was included in the final wave in October. Since then, I've been looking for an equivalent job locally but have yet to find one, while my replacement is paid roughly 20% of my previous wage - and the CEO laughs all the way to the bank! So, we have tax dollars funding development of workers in other countries AND additional tax dollars supplementing the unemployment insurance program. All while the fat cats keeping rolling in the dough from our misery.

  • Yahoo! IBM Pension and Retirement Issues message board: "Sept 1 is the new announcement date" by "second_choicer". Full excerpt: This just leaked from IBM Legal. The much anticipated announcement of Retirement plan changes affecting 30+ year employees on the "prior plan" is undergoing 'modifications' by IBM legal and will be announced Sept. 1. Wish I had more details. This will devastate our department. But at this point I have to think about my future. Good luck to all affected.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Sept 1 is the new announcement date" by "art_vandalay". Full excerpt: Interesting that you would word it that way. The employees that are 30+ years really don't have much to lose. They have gained most of their planned pension and have qualified for the medical dollars (FHA.) It would be the employees that are on the old plan that do not have 30 years (and are under 55) that would take the greatest hit. Of course, that is assuming it is a cash balance conversion. Maybe that is what you meant to say.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Sept 1 is the new announcement date" by Bob Nelson. Full excerpt: I retired in the beginning of 2005. I have been waiting to see the impact of all the cuts. It would seem that IBM should implode. I think that superior technology and some dedicated (in spite of everything) employees are holding things together. But, there are some cracks are evident.

    I spent my entire IBM career in field service. After retiring, I have been working part time for a business partner. I have had customers pay me to come on site and hold the IBM CE's hand. IBM used to be the expert - a sad commentary.

    Last week, I met a customer who is spitting mad at IBM. He would dump IBM in a heat beat if he could. He loves the equipment and he loves his service folks. The problem? Administration. Every time he calls for service, he is told no contract. He has contracts on everything. All the administration was moved to Brazil. The customer and the IBM salesman spend days working with administration to correct the records. The next service request is still denied. The problem seems unfixable. Regards, 73, Bob Nelson, K2QPN, IBM 1967-2005 ITS NE Area Technical Support Staff.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Sept 1 is the new announcement date" by "Thomas". Full excerpt: Has anyone with 26-28 years of service run netbenefits' "estimate a payment" over the last few days? I noticed that any scenario that has a benefit commencement date any time in 2010 is listed under "PPA Benefit". Any scenario that has a benefit commencement date in 2011 or later is listed under "IBM Personal Pension Plan". And although the lump-sum figure is slightly higher in the 2011 scenario, the single life annuity figure is significantly lower.

    Here's a screenshot (with most figures blurred out) http://i36.tinypic.com/34nf692.jpg

    I will be contacting benefits to find out what that means, but was wondering if anyone else noticed this too. Did Fidelity jump the gun on some pension plan change? thx!

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Sept 1 is the new announcement date" by "art_vandalay". Full excerpt: Thomas, I ran my today and used the exact dates that you used. Both scenarios were listed under the "IBM Personal Pension Plan - Prior Plan." There was no PPA section. I have 28 years 7 months in the books. Have you checked today to see if you are still getting the same reporting? Are you over 55?
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Sept 1 is the new announcement date" by "Thomas". Full excerpt: art_vandelay, There is no change for the PPP eligible employees, only those who have been converted to the PPA (cash-balance) plan appear to be affected. I have 28 years with the company and am 48 years old. Yes, I have run the scenarios again today and getting the same reporting. I have contacted ESC and they have confirmed both the payout numbers and differing designations as being correct. Pretty strange.
  • Yahoo! IBM Retiree Information Exchange message board: "Re: United Healthcare PPO as a choice" by "aignog". Full excerpt: I also live in Washington state on the Olympic Peninsula which is about 50 miles northwest of Seattle. UHC doesn't want to pay claims and makes it difficult to deal with them. This is not only my experience but also that of local doctors and billing department employees who have told me UHC is not easy to work with. In my area we call it United Hell Care. I had surgery two years ago by a doctor who was highly recommended, but he would not contract with UHC and so I personally paid the bill.

    It took me three months with multiple submittals to UHC and several phone calls to get payment for a flu shot at Costco. According to UHC, IBM required the shot be at clinics or doctors' offices. Not so and after they finally found out they were wrong, they lost paperwork and then wanted doctor's tax number for Costco -- what a waste of time for $20.

    I also had problems with my mammogram and yearly physical being paid by UHC. From talking to others, it appears that UHC makes payment difficult hoping we'll give up and they won't have to pay. I just hang in there and finally get what my premiums paid for.

    I recently went on Medicare and find their processing of payments and online account updates much quicker than UHC and best of all there is no payment hassle. This is one person who is happily went on Medicare and left the stress of UHC behind. The best part with Medicare is that I talk to a person in the United States and not a person in a foreign country.

  • Wall Street Journal: U.S. Super Rich to Share Wealth. By Shelly Banjo and Robert A. Guth. Excerpt: Billionaire Oracle Corp. founder Larry Ellison will join film director George Lucas and 38 other mega-wealthy people in following a call by Warren Buffett and Bill and Melinda Gates to pledge to give the majority of their riches to charity. On Wednesday, Mr. Buffett announced that 40 of America's wealthiest individuals and families, from former Citigroup Inc. leader Sandy Weill to hotel mogul Barron Hilton, have signed the "Giving Pledge." Mr. Buffett and Mr. Gates in June had asked the individuals and families to publicly commit to give away at least half of their wealth within their lifetimes or after their deaths. The pledge stemmed from a series of dinners the two men held for the nation's billionaires over the past year to discuss the effects of the recession on philanthropy.
  • Wall Street Journal: Higher U.S. Visa Fees Would Hit Indian Firms. By Amo Sharma and Keith Johnson. Excerpts: Legislation that passed the U.S. Senate late Thursday would significantly increase fees for skilled-worker visas, a move that would deal a financial blow to Indian technology-outsourcing companies that send thousands of employees to the U.S. each year. The measure, which was attached to a $600 million border-security spending bill that senators passed just before leaving for their August recess, would require all companies with U.S. staff that have more than half their U.S.-based employees on H1-B or L-1 visas to pay thousands of dollars in special new fees for each worker. ...

    All of the biggest Indian tech companies would be affected by the fee increases, Mr. Mittal said, including giants such as Wipro Ltd., Infosys Technologies Ltd. and Tata Consultancy Services Ltd. Big U.S. tech companies such as Microsoft Corp. and Intel Corp. would almost certainly avoid the fees because their foreign workers make up less than 50% of their overall U.S. work force. An Intel spokesman said Friday, "We are aware of the legislation, we did not take a position on it and are not impacted by it." ...

    Indian software services and outsourcing companies generate about 60% of their combined $50 billion in annual revenue from the U.S. The Indian industry has enjoyed explosive growth over the past decade, fueled by an army of skilled, low-cost, English-speaking workers in Bangalore and other Indian cities. ...

    As the U.S. backlash over outsourcing has intensified in recent years, some critics have zeroed in on the skilled-worker visa programs, arguing that they give foreign companies a beachhead to facilitate deals with U.S. companies that ultimately transfer American jobs abroad. Sen. Charles Schumer, the New York Democrat who co-sponsored the legislation raising visa fees with Claire McCaskill (D.-Missouri), has been a critic of outsourcing. ...

    According to a summary of the Senate bill, the new charges would increase visa fees paid by affected companies by roughly $2,000 per visa application. But Mr. Mittal says the increase would actually be about $4,500 more per worker for new visas and $4,000 more for renewals. Currently, most visa applicants also face additional fees; in most cases, the H1-B visa fees amount to about $2,320.

  • Bloomberg/BusinessWeek: Big Tech Problem as Mainframes Outlast Workforce. IBM and CA are hard-pressed to replace the aging corps of Baby Boomers who support their still-indispensable mainframe business. By Rachael King. Excerpts: When Giorgos Tsapepas started as an intern at IBM (IBM) in 2002, he had never used a mainframe. At Rensselaer Polytechnic Institute, the university he attended in upstate New York, there was no instruction in handling the powerful machines that tackle complicated computing tasks for such industries as finance and health care. Now a mainframe expert, Tsapepas had to learn his specialty on the job.

    Teaching mainframe skills is out of vogue at many universities with the advent of newer approaches to solving the biggest computing challenges. At the same time, many of the engineers capable of tinkering with the refrigerator-sized machines are nearing retirement. The average age of mainframe workers is 55 to 60, according to Dayton Semerjian, a senior vice-president at CA Technologies (CA), the second-largest maker of software for mainframe computers after IBM. "The big challenge with the mainframe is that the group that has worked on it—the Baby Boomers—is retiring," Semerjian says. "The demographics are inescapable. If this isn't addressed, it will be trouble for the platform."

    Selected reader comments concerning this article follow:

    • Gone From IBM. Maybe if IBM valued their workers instead of treating them as a dispensable expense, they would not be have to worry about who will support this technology.
    • Former IBMer. Poor IBM! They laid off so many workers nearing retirement that they no longer have sufficient manpower to train newer employees. This article is nothing but propaganda for bringing in cheaper foreign labor.
    • David.I know probably 100 or more people with EXTENSIVE mainframe experience here in the Denver area who are currently laid off, not retired - myself included. Why doesn't anyone give us a call? We're eager and ready to work. I think the other posters nailed the answer: IBM and CA would rather have cheaper foreign workers.
    • Outsourced. This is absurd, and hiring Chinese workers to replace these Americans is treason. There are so many thousands of Americans who have this mainframe skill but our CEOs are craven monsters who would gladly turn China into the number one world power and have them share the secrets of mainframe security with, gulp, the Chinese government. This is an article funded by these outsourcing, job-destroying CEOs.
    • What the? If the reporter wanted to report the true story, she should have asked IBM, "How many MAINFRAME workers have you laid off in the USA and how many have you called back?" I'll bet my unemployment check that the answer would be, "Thousands", and, "Zero."
    • JT. More BS drummed up by IBM and others as a reason to import cheap foreign labor. If Mainframe experience is so precious then I hope the author will explain to me why IBM laid off / displaced 16,000 people last year. Many of them were older workers with many years of mainframe experience. Not to mention the fact much of the development and support work has been off shored. I should know, I and several other co-workers we made to facilitate the “transition” read: train our replacements. The bottom line is, these companies want a cheap disposable labor force. If they can’t get it overseas then a fresh college grad will do for now. The title of the article should read “Big Tech Problem as Mainframes Outlast Cheap Workforce”.
    • Otis. No Andrew, we were forced to train our Indian replacements. They are brought here, because they can be exploited. Bill them out at $40-50/hour pay them peanuts, then give a BIG kickback to Mr. CIO or Mr. Vendor Relations. I make 1/2 of what I did 10 years ago, and now they want to "offshore" my job again. Doesn't matter it too 6 to fill my last job, someone's making a kickback. Wake up!
    • Culpeperson. They real story is that older workers are being forced out with layoffs and performance reviews. Multinationals while taking tax credits are creating jobs all right, but the jobs are in India, Philippines and China.
    • S 806 .T There is no shortage of mainframe programmers. There are thousands and thousands of them ready to work. Problem is, their positions are not in the US of A. If they relocate to Bangalore, and accept one quarter of their former salary, India Business Machines would gladly rehire them back.
    • Changer. The aging mainframe workforce that IBM laid off... thousands...consisted of many employees under the age of 35. Almost all of us, the old included are well-versed in Unix, Linux, Open Source, C/C++. Many have Java skills as well. This article is a shill for IBM's malfeasance. Hiring 300 Chinese employees to be trained by the mainframe workforce. Thank You IBM for handing the mainframe and all its unique security innovations over to the Chinese dictatorship. IBM management gets the pass again. We must fight outsourcing with every weapon we have.
    • What the? The article should have been titled "IBM and CA Having Trouble Finding Mainframe Skills for $35,000 a Year."
    • KEC. I had to sing a few bars of "don't cry for me Argentina" when I read this e-article. The reality is that IBM has laid off tons of expert Mainframe people between the age of 40-59 in a sweep at getting their payroll to a bare minimum and so they can eliminate those employees that would have gotten good retirement benefits if they had been allowed to complete their career with IBM. Often maligned by today's HR departments as the 'dead wood', these people were once fairly compensated, loyal employees that found themselves discounted at the tail end of their working careers and thrown under the bus by the company that now needs their expertise but won't pay for it.

  • Glassdoor IBM reviews. Selected reviews follow:
    • IBM Principal Consultant in Paris (France): (Current Employee) “Great company but to big to run on full power.” Pros: Good work and private life balance. Cons: Whether you are performing or not there is very little difference. Don't expect huge pay rise once you are on board. Advice to Senior Management: Stop managing the company like a bank and start to focus on the technology.
    • IBM IT Specialist in Denver, CO: (Past Employee - 2010) “IBM - Big Blue - Hunting For Bargain Basement Deals.” Pros: Very flexible in working remotely from home for many positions - just be aware that that sooner or later your job / position will be off-shored to a cheaper 3rd world country, no matter how great of performer you are or how dedicated you might be.

      This is a good company for any fresh-out-of-school job hunter that wants to gain some standard 21st corporate world experience. The pay is not bad for the fresh-out-of-school job hunter. For more experienced workers however, IBM is very limited. Executive management's not-so-secret agenda is to layoff as many "high priced" USA-based employees (and in other developed countries) and off-shore everything possible to the 3rd world. Any gaps are theoretically back-filled with the "layoffees" as contractors, assuming they can't find work elsewhere.

      Cons: IBM is not a place where job hunters should apply if they are seeking long term employment.or stability. One day an IBM employee may come into work as he/she has done for the past 20+ years and be taken into the manager's office to be told their position is being Resource Actioned (IBM does not like to use the words "Laid Off"). The soon to be EX Employee will then be required to stick around for the next 30 days. This 30 day period is so the soon to be EX Employee will have the privilege to train their India Replacement staff member. Once the 30 days is past and the training is complete the EX Employee will no longer be needed and will be thrown out like yesterday's garbage.

      You'll have lots of exposure to different technologies at IBM. Unfortunately, a lot of what's forced on you is either proprietary, obscure, or rapidly vanishing outside the world of IBM (think Lotus Word Pro, Lotus Notes, Domino, etc). Many US-based jobs at IBM are "tenuous", so the workplace feels a lot like dining under the Sword of Damocles. Since your co-workers know that the end could come at any moment, and their survival depends upon how well they rank compared to you, the result is reduced information flow/share, cooperation, participation, and general workplace camaraderie among your co-workers.

      On the subject of "how you rank", the PBC system (performance reviews) at IBM is a TOTAL FARCE. It's basically a random system of ranking by the managers. Worse yet, you usually already have a performance number assigned before the evaluations ever begin -- based on who the manager's favorite employees are, how many people in the dept the execs said will need to be laid off in the next year, etc.

      Advice to Senior Management: If all of the work that IBM does can be done with cheaper labor and cheaper office space in 3rd World countries, does that mean that eventually IBM Headquarters will be moved to India or perhaps Samuel J. Palmisano's job is going to be off-shored to Pakistan ?? Just wondering. "IBM - MADE EVERYWHERE BUT THE U.S."

    • IBM Anonymous: (Current Employee) “Not a great place.” Pros: Flexibility of work schedule. Looks good on your resume. The amount of free training that is offered. Cons: The landed management sucks. You can forget about a raise They take you from doing something you enjoyed to doing crap in a snap of the finger Unfortunately women and men are treated completely different. They don't care about the client happiness, only about how many tickets are being closed. Communication from management to employees are little to none. Not a clear view of your job role sometimes. Advice to Senior Management: Top management - Pay attention to what is going on around you rather than just numbers. Sometimes the ones doing the grunt work know how to improve client satisfaction, so ask them! Also pay attention to how they are being treated by the management on the account...especially women.
    • IBM Anonymous: (Current Employee) “Being working here for my whole life, so I can't compare much.” Pros: Solid company, isn't going anywhere. Nice resume boost overall. Cons: Promotion is based on networking pretty much. Advice to Senior Management: I have 23 Managers between me and the CEO. Maybe we need to work that out.
    • IBM Senior Managing Consultant in Dallas, TX: (Current Employee) “They ain't what they used to be.” Pros: As a general rule, the employees are some of the brightest. Work flexibility / work from home. The IBM name still has some weight on resumes. Cons: Very unfair way of rating performance. Limited to no career advancement training. Utilization targets are impossible to achieve if you've been with the company for many years. Advice to Senior Management: Let the employees make the decisions, they know the job better than you. Guide them to success. Assist them to achieve their goals.
    • IBM Anonymous: (Current Employee) “=) =)” Pros: Flexible schedule is often available. Lots of work can be done from home also worked with some great people in the company. Cons: Moving a lot of work to low cost locations such as India, China, and Brazil. A lot of politics involved in any change. Advice to Senior Management: Keep an eye on employee morale.
    • IBM Anonymous: (Current Employee) “Not the best place to work.” Pros: Hard to be let go once you are a regular employee. Work hours are normally steady without much change. Large company with multiple locations to work. Cons: Only brings on contractors for low pay. Pay raises are practically non existent. Lateral moves to other positions are hard to get unless you know somebody. Advice to Senior Management: Start treating employees as people instead of just a number. Hire contractors on as regular employees if they are good at the job.
    • IBM Anonymous: (Current Employee) “Not your father's IBM.” Pros: Large community of IT professionals. Can make some good friends and contacts. Opportunity to make networks worldwide across various different technologies. Cons: IBM management is terrible. People are treated as an expense, not as individuals. The remuneration 'package' is a con and designed purely in IBM's favor. Advice to Senior Management: My advice to management? Start treating your employees with the respect they deserve. People are leaving in droves because you're don't look after them.
New on the Alliance@IBM Site
  • To Alliance@IBM supporters: The Alliance is the only organization that advocates and supports IBM employees and ex-employees. In fact, there are few like it in the Information Technology field. It is always difficult to keep an organization like this alive, but as a supporter you know how important it is that we exist. We are calling on you today to help keep us alive another year by joining as a member or associate member. See our online forms below. As our membership has dropped, it is imperative that we gain new members or this organization and web site will cease to exist. Help us keep our organizing and advocacy work alive!
  • General Visitor Comments: Due to a lack of membership growth the comment sections will be closed until we see sufficient growth in full membership, associate membership or donations. Many of you that visit our site have not yet joined, but seem to value its existence. The only comment section that will remain open will be Job Cuts Reports. If you have information that you want the Alliance to know about please send to ibmunionalliance@gmail.com. Information of importance will be put on the front page of this web site. To join go here: Join The Alliance! or here: Join The Alliance!
  • Job Cut Reports
    • Comment 7/31/10: I resigned from IBM, effective yesterday. I kept asking to be RA'd but it just didn't happen. I was a project manager for more than 10 years and with IBM for 15 years. Every day became more and more unbearable until I decided it was time to leave. I was tired of feeling like the enemy. Customer's were always unhappy with us because we couldn't deliver what they had been sold; generally because of lack of dedicated resources. Technical teams were always pushing back because they were so understaffed that they were spread too thin. When I told one colleague that I'd resigned, he said I was the third this week to tell him they'd resigned. Several others said they'd leave if they could afford to do so. There is no doubt that if IBM Management doesn't figure out that sending US jobs to India and other countries or focusing on this -Resigned-
    • Comment 8/02/10: Has there been any RA in Canada with people being asked to relocate to the US? At what point do large customers backlash at IBM? I have not heard any CNET/Google News/Information Week or external new sources that talk about this substandard support... Internally I am seeing/experiencing it daily. -TeamCanada-
    • Comment 8/04/10: I can tell you that some customers are getting fed up with IBM's antics regarding offshoring and Global Delivery Centers that are staffed by people that do not know what is going on. There were major issues on the Dow Chemical Exchange account after it transferred to GDC and Dow Chemical asked for the old team back. IBM told them that getting the old team back is not possible and Dow Chemical took their Exchange business and gave it to Microsoft to host in the cloud. There goes a big contract worth millions of dollars a year. -I Dunno -
    • Comment 8/04/10: I am also aware of several large customers of IBM who are fed up with the quality of support they are receiving from India. Keep RAing people in the USA who have the experience, with support from India and Asia. There will be a large amount of companies who will seek better service and quality. -Ana-
    • Comment 8/04/10: Was RA'd from ITD. A casualty of GDF relocation. Going through the unemployment forms, etc. For those who have been through this, what are the pros and cons of reporting/not reporting your severance? Are you denied unemployment benefits for the length of your severance? If so, why bother submitting a claim if there's no benefit. Thank you. -Going Going Gone-
    • Comment 8/05/10: I just received anonymous mail via Monster for my job (times three), but in Dubuque. It was worded a bit desperately and came from an Indian recruiter. I have no plan to reply. -CDI_Drone-
    • Comment 8/06/10: To: Going, going gone: Each state is different in the application for unemployment. In my state, a lump sum severance does not hurt and you do not report it. Check out your state's unemployment website for applications and how to file. -anonymous-
    • Comment 8/06/10: To Going Going Gone - Severance is NOT salary. I don't know what your unemployment forms look like, but if it asks if you got severance, you should not lie. If it asks if you're getting paid, or"have you earned any wages" this week etc, the answer is no, because indeed you have not. There really is no "length" of your severance. It is a lump sum payment calculated based on some formula; could be a random number, could have been based on your shoe size. In IBM's case, formula of "weeks of salary based on length of service." But this is NOT salary, there is no "length of severance". Your length of severance is only the day you got it. Starting Monday (or Sunday dependent on your state) of the following week, you are earning exactly zero from IBM. Disclaimer: I'm not a lawyer, but I went thru this and was advised by one. But this was my experience, and I received unemployment benefits starting the week after I was out of IBM. -RAed Jan 09-
    • Comment 8/06/10: The Campbells account is setting IBM adrift. They have signed with CSC for new development work. Next on the chopping block are those with the S/A groups, Middleware and DBA groups. Customers are becoming fed up with IBM. -dun-4-
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.

  • New York Times op-ed: A Sin and a Shame. By Bob Herbert. Excerpts: The treatment of workers by American corporations has been worse — far more treacherous — than most of the population realizes. There was no need for so many men and women to be forced out of their jobs in the downturn known as the great recession.

    Many of those workers were cashiered for no reason other than outright greed by corporate managers. And that cruel, irresponsible, shortsighted policy has resulted in widespread human suffering and is doing great harm to the economy. ...

    As Professor Sum studied the data coming in from the recession, he realized that the carnage that occurred in the workplace was out of proportion to the economic hit that corporations were taking. While no one questions the severity of the downturn — the worst of the entire post-World War II period — the economic data show that workers to a great extent were shamefully exploited.

    Productivity tells the story. Increases in the productivity of American workers are supposed to go hand in hand with improvements in their standard of living. That’s how capitalism is supposed to work. That’s how the economic pie expands, and we’re all supposed to have a fair share of that expansion. Corporations have now said the hell with that. Economists believe the nation may have emerged, technically, from the recession early in the summer of 2009. As Professor Sum writes in a new study for the labor market center, this period of economic recovery “has seen the most lopsided gains in corporate profits relative to real wages and salaries in our history.” ...

    Executives are delighted with this ill-gotten bonanza. Charles D. McLane Jr. is the chief financial officer of Alcoa, which recently experienced a turnaround in profits and a 22 percent increase in revenue. As The Times reported this week, Mr. McLane assured investors that his company was in no hurry to bring back 37,000 workers who were let go since 2008. The plan is to minimize rehires wherever possible, he said, adding, “We’re not only holding head-count levels, but are also driving restructuring this quarter that will result in further reductions.”

    There can be no robust recovery as long as corporations are intent on keeping idle workers sidelined and squeezing the pay of those on the job.

    It doesn’t have to be this way. Germany and Japan, because of a combination of government and corporate policies, suffered far less worker dislocation in the recession than the U.S. Until we begin to value our workers, and understand the critical importance of employment to a thriving economy, we will continue to see our standards of living decline.

  • New York Times op-ed: Defining Prosperity Down. By Paul Krugman. Excerpts: I’m starting to have a sick feeling about prospects for American workers — but not, or not entirely, for the reasons you might think. Yes, growth is slowing, and the odds are that unemployment will rise, not fall, in the months ahead. That’s bad. But what’s worse is the growing evidence that our governing elite just doesn’t care — that a once-unthinkable level of economic distress is in the process of becoming the new normal. ...

    Not long ago, anyone predicting that one in six American workers would soon be unemployed or underemployed, and that the average unemployed worker would have been jobless for 35 weeks, would have been dismissed as outlandishly pessimistic — in part because if anything like that happened, policy makers would surely be pulling out all the stops on behalf of job creation.

    But now it has happened, and what do we see?

    First, we see Congress sitting on its hands, with Republicans and conservative Democrats refusing to spend anything to create jobs, and unwilling even to mitigate the suffering of the jobless.

    We’re told that we can’t afford to help the unemployed — that we must get budget deficits down immediately or the “bond vigilantes” will send U.S. borrowing costs sky-high. Some of us have tried to point out that those bond vigilantes are, as far as anyone can tell, figments of the deficit hawks’ imagination — far from fleeing U.S. debt, investors have been buying it eagerly, driving interest rates to historic lows. But the fearmongers are unmoved: fighting deficits, they insist, must take priority over everything else — everything else, that is, except tax cuts for the rich, which must be extended, no matter how much red ink they create.

    The point is that a large part of Congress — large enough to block any action on jobs — cares a lot about taxes on the richest 1 percent of the population, but very little about the plight of Americans who can’t find work. ...

    What lies down this path? Here’s what I consider all too likely: Two years from now unemployment will still be extremely high, quite possibly higher than it is now. But instead of taking responsibility for fixing the situation, politicians and Fed officials alike will declare that high unemployment is structural, beyond their control. And as I said, over time these excuses may turn into a self-fulfilling prophecy, as the long-term unemployed lose their skills and their connections with the work force, and become unemployable.

    I’d like to imagine that public outrage will prevent this outcome. But while Americans are indeed angry, their anger is unfocused. And so I worry that our governing elite, which just isn’t all that into the unemployed, will allow the jobs slump to go on and on and on.

  • Huffington Post: Alan Greenspan: Extending Bush Tax Cuts Without Paying For Them Could Be 'Disastrous'. Excerpts: In an interview on NBC's "Meet the Press," Greenspan expressed his disagreement with the conservative argument that tax cuts essentially pay for themselves by generating revenue and productivity among recipients.

    "They do not," said Greenspan. ...

    Speaking with PBS' Judy Woodruff, Greenspan expressed his opposition to passing legislation that would hold tax rates steady (under law the tax cuts Bush passed ten years ago are going to expire, thereby bringing rates back to Clinton-era levels). President Obama has pledged to continue the tax breaks for those individuals making under $200,000 and those families earning less than $250,000.

    But Republicans want the entire package kept in place. Even so, they have declined to say how they would pay for it, saying, in part, that keeping the Bush tax cuts in place will pay for itself.

  • YouTube Video: The American Dream. By George Carlin.
  • Yahoo! IBM Employee Issues message board: "Capitalism: A Love Story" by "teamb562". Full excerpt: Would highly recommended everyone rent this movie. It doesn't make you feel any better but it helps clarify many of the posts made here over the years. Michael Moore did a wonderful job on a difficult subject and brings a little humor along to lighten the load. But keep a tissue handy anyway. I think if this were required viewing for all Americans that we could truly affect change. According to Mr. Moore, change will not effectively commence until enough Americans realize that they will not make it to the big leagues, be rich, or even have a chance at it. It's that "chance" that Americans have been conditioned to believe in that is the road block to real change and a level playing field. Likewise, it's that "chance" that the elitist must carefully navigate (let us believe we can win) in order for their survival.
  • Christian Science Monitor: The bygone middle-class golden era. The middle-class engine of the US economy faces a triple threat: stagnating wages for most, diminished opportunity for upward income mobility, and rising income inequality. By Rocky Vega. Excerpt: “Dubbed ‘median wage stagnation’ by economists, the annual incomes of the bottom 90 per cent of US families have been essentially flat since 1973 – having risen by only 10 per cent in real terms over the past 37 years. [...] In the last expansion, which started in January 2002 and ended in December 2007, the median US household income dropped by $2,000 – the first ever instance where most Americans were worse off at the end of a cycle than at the start. Worse is that the long era of stagnating incomes has been accompanied by something profoundly un-American: declining income mobility…

    “…Nowadays in America, you have a smaller chance of swapping your lower income bracket for a higher one than in almost any other developed economy – even Britain on some measures. To invert the classic Horatio Alger stories, in today’s America if you are born in rags, you are likelier to stay in rags than in almost any corner of old Europe. Combine those two deep-seated trends with a third – steeply rising inequality – and you get the slow-burning crisis of American capitalism. It is one thing to suffer grinding income stagnation. It is another to realise that you have a diminishing likelihood of escaping it…

  • truthout: A Tax Break Nobody Needs. By Gerald E. Scorse. Excerpts: Cutting the federal deficit is a hot topic these days, and some kind of action seems certain. Congress is due to take up taxes for the first time in President Obama's term (including the expiration of the Bush tax cuts), and a report from the president's national debt commission is expected come December. Both bodies should take a hard look at ending a needless tax break; getting rid of it would raise billions and make the tax code a touch fairer in the bargain.

    This little-remarked giveaway is the write off which the Internal Revenue Service allows every year for stock market losses: when net losses exceed gains, taxable income can be reduced by up to $3,000. This is "I-want-it-now" tax law and it turns a private loss into a hurry-up claim on the public purse. With the deficit soaring, it richly deserves repeal.

    The same as now, capital losses could be written off dollar for dollar against capital gains. The same as now, losses could be carried forward indefinitely until they were wiped out. What the repeal would disallow is writing off stock market losses against ordinary income (which, as we shall see, was poor policy in the first place). ...

    Roughly half of all Americans own no stocks, so losses in the market offer no tax advantages to them. While it's true that more people than ever do own stocks, most have their holdings in tax-sheltered retirement accounts; the write off doesn't help them, either. It turns out that the benefits flow entirely to a privileged minority: those well-off enough to have nonretirement investment portfolios. There's no defense for a tax break so skewed toward the affluent, especially one as gratuitous as this. And who picks up the tab? Like any other tax deduction, it's paid for by taxpayers in the aggregate; in this case, the many pony up to benefit the few. Far better for the Treasury, and better for tax fairness, if Congress shows some spine and calls a halt.

  • New York Times: Senate Debate Looms on Tax Cuts for Rich. By Jackie Calmes. Excerpts: For now it is Treasury Secretary Timothy F. Geithner who has emerged as the point man in the administration’s offensive to let the high-end tax cuts expire and extend those for the middle class. “Permanently extending the tax cuts for the top 2 percent would require us to borrow $700 billion more in the next decade, adding significantly to an already unsustainable level of debt,” Mr. Geithner said in remarks at an event jointly hosted by the Center for American Progress, a Democratic-leaning research and advocacy organization, and the American Action Forum, a Republican-oriented group. ...

    Both Mr. Geithner and the president hammered on the theme that administration policies point the way forward while Republicans would take the country back to the days of the Bush administration, and not just on tax policy. Mr. Obama told the labor leaders they must remind their members, “this election is a choice,” between “these folks who drove America’s economy into a ditch” and the Democrats who for 20 months have “been shoving that car out of the ditch inch by inch” as Republicans stood by. “And now we’ve finally got that car up on the blacktop there, about to drive, and they say they want the keys back. Well, you can’t have the keys because you don’t know how to drive,” Mr. Obama said, to laughter. ...

    Mr. Geithner said even a temporary extension would be a mistake. In international forums, he has cited the tax cuts’ expiration as a major way in which the United States will begin reducing its projected debt. “The world,” he said, “is likely to view any temporary extension of the income tax cuts for the top 2 percent as a prelude to a long-term or permanent extension, and that would hurt economic recovery as well by undermining confidence that we’re prepared to make a commitment today to bring down our future deficits.” As stimulus, Mr. Geithner added, the $30 billion needed for a one-year extension would be better spent for more middle-class tax cuts, business investment incentives or aid to hard-pressed states.

  • Jim Hightower: Kissing Bankers' Butts. Full excerpt: Oh them wild and naughty bankers! What in the world will those rapacious rapscallions of Wall Street do next? Just recently, we learned from Kenneth Feinberg, the government's special investigator of banker pay, that top executives of 17 financial giants shoveled $1.6 billion in excess compensation to themselves in 2008 – at the very moment their failing banks began to draw billions of bailout dollars from us taxpayers. Among the pranksters pocketing eye-popping amounts were the high-rolling bank bosses at American Express, Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, PNC, and Wells Fargo.

    So, what's the punishment these self-serving money manipulators can expect from Washington's arbiter of excessive executive pay? None. In a stunning show of soft-on-crime leniency, Feinberg declared that he will not even attempt to recoup any of the $1.6 billion the money-grubbers grubbed from us. Declaring that he thought shaming these bad boys was enough, Feinberg asked plaintively, "At what point are you piling on and going beyond what's warranted?"

    Shaming them? They're Wall Street executives – they were born without the shame gene! Piling on? They imploded their banks, crashed our economy, got Washington politicos of both parties to save their jobs, paid themselves a looter's level of taxpayer booty, and now are getting a free pass to continue their flimflammery. Feinberg even refuses to release their names. Some shame!

    If you rob a bank, the law hunts you down and throws your scrawny butt in jail to teach you and other robbers a lesson. But the lesson that Feinberg has given to America is that if you run a bank and rob the people, the law kisses your ample butt, giving you and others permission to find evermore-creative ways to keep stealing from us.

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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