With More IBM Layoffs Due, Vermont Seeks Better Notice

While IBM employees brace themselves for yet another round of layoffs, Vermont Labor Commissioner Annie Noonan is calling for better notice and more authority over such “workplace actions.”

LayoffsBig Blue has been downsizing its workforce in North America for years, though it usually doesn’t announce specific numbers and couches it in terms of its expected cost savings. IBM’s union, Alliance@IBM, is expecting roughly 15,000 workers to be cut at Big Blue’s manufacturing plants in Vermont and New York around Feb. 26.

Vermont Warns IBM

The federal Worker Adjustment and Retraining Notification Act, known as the WARN Act, however, requires employers to provide notice 60 days in advance of covered plant closings and covered mass layoffs. It’s designed to help workers and communities prepare.

Noonan told VTDigger.org that WARN notices apply only to large companies by Vermont standards and don’t provide adequate time to prepare.

“Not to pick on IBM,” Noonan said of previous layoffs, “(but) we were getting calls from the town manager, the superintendent of schools, people who have to plan around the community.”

The state’s Labor Department needs to know how much its Unemployment Trust Fund will be tapped and the depth of assistance it will need to provide residents, Noonan said.

Vermont’s efforts to gain more information in 2013 included a public challenge from the governor, which prompted IBM to finally disclose that it cut 419 workers at its Essex Junction plant in June.

Ripple Effect?

Under the WARN act, companies are only required to notify state officials if the layoffs will affect 500 or more employees, or represent a third of the workforce if the cuts will touch 50 to 499 workers.

But Vermont house bill H.758 calls for requiring a 90-day notice for companies that plan to lay off more than 20 employees. It would also require back pay for aggrieved employees and civil penalties capped at $5,000 per employee.

Other states could be clamoring for more transparency from Big Blue as well.

At a rally in New York Assemblyman Kieran Lalor, R-Fishkill, called for clawbacks for companies that receive public money but fail to maintain the number of jobs promised.

Interestingly enough, after climbing to a three-year high in 2012, tech layoffs declined by 32 percent in 2013 as companies focused on growth areas such as Big Data, cloud computing and security, according to global outplacement firm Challenger, Gray & Christmas.

IBM’s $1 Billion ‘Rebalancing’

IBM, however, cut more than 3,500 jobs in North America last year, including about 700 in Dutchess County, N.Y., and 203 workers in Silicon Valley – numbers gleaned from documents filed with the State of California. IBM has about 400,000 employees total in more than 170 countries.

The company got in trouble with the Department of Justice – and agreed to a settlement in September — over online job postings allegedly stating a preference for F-1 and H-1B visa holders.

And after a disappointing earnings report last month, IBM committed to a $1 billion cost-cutting move and “rebalancing” of its workforce. That could mean as many as 13,000 jobs, according to Bernstein Research analyst Toni Sacconaghi, though Alliance@IBM puts that closer to 15,000.

IBM’s sale of its x86 server unit to Lenovo could move some 7,500 workers to the Chinese company’s payroll. Lenovo has said it will extend offers to those workers – though that could take months, WRAL TechWire points out, wondering whether they will be cut in the meantime.

Amid its layoffs, the company has still been on a hiring spree for a new design center in Austin, Texas, and a tech-services operation in Baton Rouge, La.

Comments

  1. BY Fred Bosick says:

    Wouldn’t it be awesome to make a law denying H-1B applications to any company that has had a layoff over the past year? You know IBM facilities in China and India are humming.

    One can dream.

  2. BY RB says:

    Why not get (publish on their web sites) the stats from any company that is looking for a H1B – a) How many H1Bs have they hired in the last 3 years b) what measures are they taking to remedy the situation and hire/train Americans c) how many H1Bs have they promoted and why

    Most of all, H1B employee should not be allowed to interview/hire another H1B.

    So many loop holes in the entire process, both legal and ethical…keep wondering who is minding the store…. what will happen in the next 10 years… likely need to emigrate to get a decent job…

  3. BY Mark says:

    What’s wrong with layoffs? Now these people will have more free time to spend with family or devote themselves to writing books while living off free benefits that will be provided to them. At least that is how the current administration is spinning the joys of unemployment.

  4. BY JP says:

    When are the IT folks in this country going to wise up and unionize. They are running this H1B con like nobody’s business. Infosys just got caught but look at TCS, WiPRO, IBM they all post jobs that don’t exist and get H!b’s and keep laying US workers off. We could have the most powerful union in the US and trust me these corporations know that. Quit waiting for the next shoe to drop and take action. Now! Visit https://washtech.org/ for details. Don’t be next.

  5. BY jm says:

    When you consider the value that IT workers have added over the past 30 years (creating efficiencies that have saved corporations trillions of dollars) and the realities of working in IT today (shrinking wages and benefits, lack of job security, and competition from the “global” work force) I have oft wondered why there hasn’t been a stronger push towards unionization. It seems only fair that IT workers should have a little more power in getting their fair share of the wealth that they have helped generate.

  6. BY David says:

    IBM will be irate that you described Alliance@IBM as their union. As a former manager at IBM I can tell you that the company went out of it’s way to keep alliance@IBM out of their facilities or as far as it could within the law.

    The only thing that matters to IBM is the bottom line. Layoffs, which happen all the time, are known as “Resource Actions”. The terminology says it all; you’re not a human, you are just ‘a resource’ (like a computer, or a desk)

  7. BY Dave says:

    I was laid off last year after joining the company six months prior. The client was upset, so IBM turns around and offers me a contract slot…which I accepted. Then they turn around and cut contractor pay 5% and mandated 1 week of unpaid leave per quarter. Needless to say that was enough and I left. I have 23 years in the IT business and I can tell you that talented IT folks are difficult to find and more so to retain. Never in my career have I been treated so badly by an employer. Being in the business for so long I have a legion of contacts, and my answer to IBM is…when the opportunity arises I convey to every single one of them that working for the likes of you is a bad idea. I hope Ginny is enjoying her stock options because the price was more than 20,000 layoffs in two years. Maybe you should focus on growth instead of your stock options Ginny, I hope you choke on the cash.

    • BY David says:

      Me too. A lot of people think that working for IBM must be a dream job. Not really. They don’t give a shit about people, but they are really good at spinning that they do..which is the worst part of it: the calousness I get, it’ was the hypocracy that I found nauseating

  8. The “corporate job” model has failed and has been failing for a long, long time and is not going to create you any significant wealth working for “the man”. The world economy is not the same as it was even a decade ago, its evolved and is evolving and a lot of people are missing the boat on other great opportunities, still stuck in their “job” mentality. You have to think outside the box and make money on the side and create wealth on your own so you can enjoy life and do the things you want to do.

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