back to article IBM quietly axing thousands of jobs, source says

IBM has been laying off a substantial number of employees this week and is trying to keep it quiet, our sources have said. One IBM employee told The Register that IBM Cloud experienced "a massive layoff" in the past few days that affected thousands of people. "Unlike traditional layoffs, this one was done in secret," the …

  1. Ace2 Silver badge

    Do you want your business-critical software written by a rotating cast of “freshers”? Neither do I.

    1. ecofeco Silver badge

      After my experience with IBM some 12 years ago, I never want anything to with them. Anything. Ever.

    2. Persona Silver badge

      Getting rid of 2 or 3% in a year does not make it a rotating cast of freshers.

      Only taking 2 or 3% seems very low. I don't think I have ever worked anywhere where only 1 person in 30 was absolute rubbish and needed removing from the organization for the good of all.

      1. OhForF' Silver badge

        "They are absolute rubbish" is a hard argument to sell for employees with 20-24 years of seniority. If people matching that description are there for that long you should first fire their managers.

  2. CapeCarl

    mv $MyJob /dev/null

    In 2011 my job as a Solaris/Linux SysAdmin for a big Swiss Re-insurance company was outsourced to IBM/Poland...Said relocated jobs probably being long gone at this point.

    on a physical note, I was stationed in Armonk, New York...On the way to work I turned right into my (former) employer's USA HQ, IF I had turned left I would have entered IBM's world HQ campus.

    ....And for some reason said layoff event seemed to expunge the last vestiges of my 1980's/90's role as an AIX admin.

  3. Woodnag

    What about the WARN notice?

    [wiki]

    The Worker Adjustment and Retraining Notification Act of 1988 (the "WARN Act") is a U.S. labor law that protects employees, their families, and communities by requiring most employers with 100 or more employees to provide notification 60 calendar days in advance of planned closings and mass layoffs of employees.

    1. MachDiamond Silver badge

      Re: What about the WARN notice?

      "requiring most employers with 100 or more employees to provide notification 60 calendar days in advance of planned closings and mass layoffs of employees."

      And if your name is Elon, what penalties are imposed if you don't? A mild scolding, a few years down the road?

      1. Anonymous Coward
        Anonymous Coward

        Re: What about the WARN notice?

        At most kicking your cybertruck - which is the one thing it CAN handle..

    2. AdamWill

      Re: What about the WARN notice?

      Looking at the requirements, this likely doesn't count as one.

      "A mass layoff is defined (under the WARN Act) as a situation where one of these criteria are filled:

      500 employees: At least 500 employees lose their job during a 30-day period at a single employment site

      50 employees: 50 employees are laid off (if the laid-off employees make up at least 1/3 of the workforce)

      33% of the workforce: At least 33% of the workforce loses their jobs (excluding part-time employees) at a single employment site during a 30-day period."

      seems fairly likely they're not laying off 500 people at any one site, or 33% of the workforce, and they definitely have more than 150 workers.

    3. Anonymous Coward
      Anonymous Coward

      Re: What about the WARN notice?

      IBM for the most part avoids the requirements of the WARN act by scattering its workforce all over the country. Different teams may appear on paper as being in different locations. IBM uses deviously cleaver planning to optimize its workforce for staff reductions. There is a way to beat them. See the other comments...

      1. Kane

        Re: What about the WARN notice?

        "IBM uses deviously cleaver planning..."

        Definitely not a spelling mistake.

      2. Cliffwilliams44 Silver badge

        Re: What about the WARN notice?

        WARN almost never impacts large corporations. It almost exclusively affects SMBs. It's just another in a long line of BS laws passed by Democrats to keep their stupid constituents thinking they are the "party of the working man" when in fact they are the party of (and were founded by) the ultra rich and the mega-corps!

    4. martinusher Silver badge

      Re: What about the WARN notice?

      The notions of "US labor law" and "protecting employees" are laughable. Its possible that this might benefit a relative handful of legacy blue collar jobs but there is essentially no protections for any US worker unless specifically negotiated as part of their individual employment contract. Most states are 'right to work' states which translated from DoubleSpeak means 'fire at will with no notice' in practice. So you can bet that what IBM has figured out is that if you announce mass layoffs then you might trigger some law somewhere but if you fire a few (dozen) people at a time then that's just routine.

      Note that a company is not obliged to provide any severance, insurance, notice or anything like that. They use this as leverage to ensure compliance with their policies -- if you behave yourself and keep your mouth shut then you'll maybe get enough severance to get by for a few months until you can find some kind of a replacement job. Failure to comply means nothing -- everything stops the moment you step outside the building. Health insurance is a big one because while Federal law allows for the optional continuation of insurance for some months after termination the employee has to pay the premium -- the full, retail rate, premium rather than the normal employee percentage deducted from the paycheck -- which the vast majority of people just can't afford.

      1. rcxb Silver badge

        Re: What about the WARN notice?

        everything stops the moment you step outside the building. Health insurance is a big one because while Federal law allows for the optional continuation of insurance for some months after termination the employee has to pay the premium -- the full, retail rate, premium rather than the normal employee percentage deducted from the paycheck -- which the vast majority of people just can't afford.

        No, health insurance USED-TO be a big one. Now with Obamacare / ACA you can sign-up for health insurance on the marketplace the day you lose your job, and it has to cover all your pre-existing conditions. It may be subsidized if you submit all the info to prove your income is now low enough, or it may end up a bit higher than you were paying at work, but we're talking a few hundred, not terrible (like COBRA).

        1. MachDiamond Silver badge

          Re: What about the WARN notice?

          "you can sign-up for health insurance on the marketplace the day you lose your job, "

          You have to wait for "open enrollment".

  4. Anonymous Coward
    Anonymous Coward

    It saddens me to see the industry I loved to work in degenerate into this never-ending cycle of chasing short term profit over quality. I've seen more than once an ex-customer terminate a contract stating "the competition may be shit, but at least they are cheaper".

    1. ecofeco Silver badge

      As usual, it leads back to Microsoft.

      https://www.justice.gov/atr/us-v-microsoft-proposed-findings-fact-0

      https://www.investopedia.com/ask/answers/08/microsoft-antitrust.asp

    2. Cliffwilliams44 Silver badge

      Accountants and lawyers, the root of all evil!

  5. Anonymous Coward
    Anonymous Coward

    Attention IBM'ers

    Attention IBM'ers!

    If IBM tags you for a Resource Action or layoff, do the following IMMEDIATELY...

    Documentation is important. Log all calls and conversations. Make PDF copies of all emails, text messages, logs, etc. and send them to your home/personal email address.

    Make a formal request in writing/email to IBM to provide you a report on the numbers and ages of the staff selected for the Resource Action (layoff) that affects you. Under the 1967 Age Discrimination Act and the 1980 Older Worker Benefit Protection IBM is legally required to provide you this information. Follow up regularly with your manager and HR person.

    IBM will probably decline to provide you this information. They will probably not give you a written answer to your request. You may get a phone call.

    File a formal complaint with the EEOC BEFORE you sign your Resource Action paperwork. It is better if you file the complaint several weeks, longer if possible before signing IBM's paperwork.

    IBM's separation documents greatly limits your legal options and mandate all disputes go through an IBM hired arbitrator. If you believe you have been discriminated against IBM's refusal to provide the legally required data can be used as a basis to get the EEOC's help. It is therefore important you ask for the data, file the EEOC complaint, and then, later, sign the separation papers.

    Life is definitely better outside of IBM.

    1. Lord Elpuss Silver badge

      Re: Attention IBM'ers

      ” Documentation is important. Log all calls and conversations. Make PDF copies of all emails, text messages, logs, etc. and send them to your home/personal email address.“

      These days most large companies won’t allow you to send large quantities of information offsite. A friend of mine works for one of the larger consulting companies, can’t say who (2 letters, starts with E, rhymes with Why) - his laptop has the USB ports blocked, file uploads are limited to their corporate Onedrive, no other transfer apps allowed.

      He needed to get a couple of presentations onto a USB stick, so mailed them to himself. Whole laptop went into lockdown, he got a message from the cybersecurity team saying they wanted a word. Was a very hostile interview apparently.

      And that’s for a couple of presentations.

      1. Cliffwilliams44 Silver badge

        Re: Attention IBM'ers

        Removing ANY information by any means out side of the companies control can violate DLP policies and get you fired for cause!

        Better to hire a lawyer early and have them file a notice of discovery, this will insure all communications are preserved.

        1. Anonymous Coward
          Anonymous Coward

          Re: Attention IBM'ers

          Use your (personal) cell phone to take pictures of your computer screen.

        2. Lord Elpuss Silver badge

          Re: Attention IBM'ers

          "this will insure all communications are preserved."

          No it won't. It'll just make sure they're a lot more careful about disposing of it.

      2. Julian Poyntz

        Re: Attention IBM'ers

        onedrive, hardly anyone stops that or you logging on with non your employer account

        1. MachDiamond Silver badge

          Re: Attention IBM'ers

          "onedrive, hardly anyone stops that or you logging on with non your employer account"

          Often times the employer has outsourced to one of those services and it's not fenced down to an account level. If your employer is using OneDrive, get an account on that too. Oops, I didn't send those files to the right account, my bad.

    2. StewartWhite Bronze badge

      Re: Attention IBM'ers

      To be on the safe side, take photos of the relevant screens using a personal phone to avoid being hit with a "You broke your contract by sending confidential material offsite" attack plus it also prevents them from knowing that you're not as stupid as they are (despite being over 30 and hence in IBM's view only fit for residence in a care home).

  6. Anonymous Coward
    Anonymous Coward

    What else is new, IBM has been doing this for decades.

    Every year they "make up" false reasons and excuses to get rid of 10% of the workforce.

  7. Pascal Monett Silver badge
    WTF?

    "they were required to sign an NDA"

    Excuse me ? If you're laying me off I will not sign that and I will talk about it. Now what are you going to do ?

    How is it that this kind of thing is legal ? At the very least, I would have thought that someone being "forced" to sign that NDA would go directly to court over the matter.

    1. Yes Me Silver badge
      Thumb Down

      Re: "they were required to sign an NDA"

      I think the poster meant that the firing manager was forcibly under NDA about the firing. As in "Sign this or you get fired too!"

      Nothing seems too despicable for IBM these days.

    2. UnknownUnknown

      Re: "they were required to sign an NDA"

      IBM can afford big lawyers to do the equivalent of SLAPP you.

    3. Lord Elpuss Silver badge

      Re: "they were required to sign an NDA"

      Most times the severance package is the leverage. You have to sign in order to receive it.

      Oh course; the smaller the package, the smaller the leverage. Which is why Statutory Minimum layoffs are more risky for companies.

      1. Dave@Home

        Re: "they were required to sign an NDA"

        Yep, exact same behaviour at EY when I got made redundant.

        Sign or you get the statutory minimum, do not ask questions around why certain roles were created for specific people, do not query why the teams taking over were not told you'd no longer be there as a point of escalation.

        1. Anonymous Coward
          Anonymous Coward

          Re: "they were required to sign an NDA"

          when people I know were made redundant after we were tupe's only got statutory minimum anyway

      2. MachDiamond Silver badge

        Re: "they were required to sign an NDA"

        "Most times the severance package is the leverage. You have to sign in order to receive it."

        If you are likely to find other employment quickly and aren't in a bad financial position, chances are it would be better to leave it. I like free money, but many times those documents have deep pits with spiky things at the bottom so if you say anything to anybody about the company, that's you being sued and they get their money back and then some. These days, just saying generically disparaging things about them is enough rather than divulging company secrets. I've had the presented to me and walked away. Lawyers!? Amirite?

    4. Anonymous Coward
      Anonymous Coward

      Re: "they were required to sign an NDA"

      Aren't you French, like me? In that case, you're used to have a rather fair balance of the law between employer and employees, and your rights as an individual being protected.

      Things are quite different in the US, I'm afraid.

      1. SAdams

        Re: "they were required to sign an NDA"

        I believe in France you get 2 years full pay?

        1. Anonymous Coward
          Anonymous Coward

          Re: "they were required to sign an NDA"

          Not that much, I'm afraid, but at the very least, they'll need to pay the full duration of the notice period (usually 3 months in IT jobs) and add a compensation that is at least ¼ monthly salary per year of service below 10, then ⅓ monthly salary for each year above 10.

          In case of mass layoffs, they usually have to negotiate the terms with employee representatives.

    5. SAdams

      Re: "they were required to sign an NDA"

      It’s very easy to do legally - the situation is usually along the lines:

      “The legal requirement is for us to pay you [very small amount]. However we are offering you a special redundancy package of [somewhat larger amount] if you agree to X and Y conditions.”

      So “forced” is probably the wrong word. Strongly encouraged?

    6. martinusher Silver badge

      Re: "they were required to sign an NDA"

      Its times like these that you realize just what your place is -- a powerless individual up against an organization that holds all the cards. Usually this exercise in bare, naked power is reserved for blue collar types, the drones in the warehouse world, but in reality we're all in the same boat with the notion of 'professionalism' being a chimera.

      This explains why there's such a rabid hatred of labor unions. A union can act as a counterweight, a bargaining unit with sufficient power to negotiate with a corporation as a peer. Its not perfect, but then what else can you do?

      I can't help thinking that if this corporation spent a fraction of the time and intellectual effort on their product design and support that they spend on keeping the workforce under control then they'd be quite the technological powerhouse.

    7. MachDiamond Silver badge

      Re: "they were required to sign an NDA"

      "Excuse me ? If you're laying me off I will not sign that and I will talk about it. Now what are you going to do ?"

      A company I left wanted me to sign an exit agreement. I took one look at it and said no. They then said they'd pay me. It wasn't enough. If they added a couple of naughts, I might have considered it, but two week's salary? nah. They weren't paying me the going rate as it was.

  8. Anonymous Coward
    Anonymous Coward

    There was anyone left at IBM besides Arvind?

    Time to replace him with AI too.

    1. Anonymous Coward
      Anonymous Coward

      Re: There was anyone left at IBM besides Arvind?

      You know how that conversation goes, right?

      https://www.youtube.com/watch?v=WCZt4mCcCV8&t=8s

      This really makes me laugh (because you know it's probably true).

    2. Fruit and Nutcase Silver badge

      Re: There was anyone left at IBM besides Arvind?

      They probably have already. With the training mostly from Jinny's correspondence

  9. Anonymous Coward
    Anonymous Coward

    Where do IBM make their money

    I'm constantly amazed IBM are still in business. Who is it that's buying IBM services or products. Do they make any products?

    1. sanmigueelbeer

      Re: Where do IBM make their money

      Companies like IBM buy (or acquire) other companies with healthier cashflows to keep themselves above the water.

      1. Cliffwilliams44 Silver badge

        Re: Where do IBM make their money

        While it is nowhere near what it was, IBM still sells their big mainframes into the finance and health care sectors (and some others). The software and consulting that goes along with that is a big part of their revenue. They should just focus on this because every time they try to do something else it never works out. They won't because they are dumb, firing all the people who know this part of the business to focus on the new and shiny that they will fail at!

        1. tiggity Silver badge

          Re: Where do IBM make their money

          Plus they earn a nice cash flow from patents (via licencing & odd bit of legislation for anything potentially infringing) as they have a vast number of patents (& we have a stupid situation that the most vaguely worded and totally obvious patents are allowed and enforced so quite easy to find infringements that (IMHO) really ae not)

        2. Anonymous Coward
          Anonymous Coward

          Re: Where do IBM make their money

          FSS is their core business, banking and insurance. But their big iron is in many large companies. They earn huge amounts from the associated maintenance contracts. Their modus operandi is to grow the business via acquisitions, trying to second guess the way the (business) markets are moving.[1] This inevitably means a growing number of employees, and so the perpetual task is to find a way to deflate this number. It's not a bad business strategy, and they are very adept at locking in new customers via sophisticated legal agreements. The strategy is to keep the customers, but boot out the employees.

          [1] Since their near-death experience in the 90s they moved into services, then when that became commoditised they developed 'on demand' that later became cloud. AI is the current flavour of the month, and happens to be in a sweet spot for them, hence their ballooning share price.

        3. MachDiamond Silver badge

          Re: Where do IBM make their money

          "They should just focus on this because every time they try to do something else it never works out."

          If they have the capital, they don't have to focus on anything other than finding a startup with a product that improves on what they currently sell, buy that company for less than development staff working on improving what they have and phasing out the old package. All they have to do is have a team build an application that migrates the data. The heavy lifting has been outsourced in a unique way.

      2. SecretSonOfHG

        Re: Where do IBM make their money

        Said it nine years ago and is becoming true... https://forums.theregister.com/forum/1/2015/07/20/ibm_q2_2015_results_mainframes_middleware/

    2. Anonymous Coward
      Anonymous Coward

      Re: Where do IBM make their money

      Ball busting license fees.

    3. Anonymous Coward
      Anonymous Coward

      Re: Where do IBM make their money

      sell whatever to the customer for quality/experienced staff

      employee the cheapest you can find globally and then prop up with graduates who know nothing

  10. Richard Pennington 1

    IBM uses percentages to obfuscate - not just in hiring and firing.

    Back in the day (I'm retired now), I used to work for IBM - not by choice (they took over my [then] employer).

    At one point they ran a series of small-group meetings where they did a PR job for their new "way forward". During the presentation they boasted that in the previous year they had promoted 7% of their workforce. I don't think they were expecting me to jump in at that point: "Translation: mean time to next promotion = 14 years".

    My line manager commented to me afterwards that psychologically I had already left - and she knew her stuff (and her staff) ... I left a couple of months later.

  11. Anonymous Coward
    Anonymous Coward

    So, the experienced staffers that actually know stuff are the ones being pulled?

    No wonder most of the IBM contractors that worked for us are now on our payroll directly instead...

  12. luis river

    Age ...what ??

    IBM massive FIREOUTS. ITS USUAL ON ARMONK CO. Come in its easy... also éxit easy, IBM veteran is rare avis !!

  13. Doctor Syntax Silver badge

    Will the last one to leave please turn out the lights.

  14. JacobZ

    Weird...

    ...how criteria like being too expensive, not a "digital native", too old to be flexible and understand emerging technologies, etc. never applies to C level positions.

    I'll bet there are tons of people in India who could do their jobs just as well for far less money. They probably bought their MBAs from the same American universities too.

    1. luis river

      Re: Weird...

      Excuse me JacobZ. Today veterans ones they are brigth and efficient employees, and that its clear age discrim. The corrupt and unfair polític class they are doomed to veteran workers!!

  15. xyz123 Silver badge

    IBM is facing over 20 THOUSAND race sex and age discrimination lawsuits.

    If the average payout is just $1,000,000 that could be $20 BILLION in payments alone (excluding legal fees).

    IBM is smoldering and they've already laid off the fire extinguisher because it wasn't in a white bottle.

    1. MachDiamond Silver badge

      "IBM is facing over 20 THOUSAND race sex and age discrimination lawsuits."

      This is the reason for HR departments. To protect the company from these sorts of issues. If HR isn't doing that, why are they there? Any complaints about harassment/discrimination should be investigated immediately, paperwork filled out and filed and consequences meted out as appropriate. No carve-outs for execs as past stories have shown the jury awards can be extremely high in those cases. If the company can show that they implement strict policies and do so equally, a case may shift back to the plaintiff to show that they reported incidents timely and properly with follow up.

  16. Anonymous Coward
    Anonymous Coward

    A great company brought to it’s knees

    It is very sad to see the continued decline of a great company that was previously identified by its values both for its customers and employees.

    It creates rigged employee ranking and value processes to justify and obfuscate resource actions that normally target more senior and older IT professionals.

    In some cases there are 3 or 4 layers of middle and senior management building spreadsheets and scoring models to target client facing professionals who are adding value (vs sitting in conference rooms deciding who to target next). It’s time for IBM to revert to the model applied by Lou Gerstner where there should not be more than 5 layers of “management” from the top to the coal face. The extra redundant layers are expert at avoiding “RA’s” in addition to creating unnecessary administrative and review workloads for productive client facing resources. This is where IBM should be looking for cost savings and productivity opportunities.

  17. luis river

    Soon be fired

    REMARK Old axiome: buy you IBM and never fired, but now XXI century total dont true

    New axiome: if works on IBM co.+ gray hair guy...get ready !!! soon be fired !!!

  18. trevorde Silver badge

    Days since last Resource Action

    zero

  19. Groo The Wanderer

    Looks like life threw me into retirement from programming at the perfect time to escape the latest bloodbath.

    The first time I was sliced was after a project delivery in around 1988. But that was good for my career, as it got me the hell out of the IT wasteland of Saskatchewan and into the GTA marketplace out east.

    I was sliced and diced in the late 80's when the Americans tore apart Northern Telecom and parceled it out for short-term profits, shafting the retirees of the retirement benefits.

    I was sliced and diced in the late 90's when the Indian outsourcing firms crashed the market value of Oracle DBAs on the southern east coast of the US.

    And I was ditched in around 2001 after I'd been used and abused to meet the goals of Y2K.

    This time I got sliced, but there is no dicing - I quit. Screw this happy horseshit. :)

    1. MachDiamond Silver badge

      "shafting the retirees of the retirement benefits."

      This is why I advocate managing your own retirement savings and not relying your employer to do it for you. If your employer offers matching funds, opt out and take an increased salary. Have the bank deduct the amount and put it in your retirement savings each time you are paid. You have to trust you bank won't go TU, but you could spread the risk over a few institutions. So many pension funds are underwater these days that if they don't get a government bailout, they won't pay or won't pay what was initially promised.

  20. Anonymous Coward
    Anonymous Coward

    Don't forget to interspline Kyndryl and IBM, exactly the same practices happen as when the employee was an IBM employee, it was just a move to offload a significant debt pile from IBM. The business model of "we will save you 10% per annum" is doomed to fail. Anyone with any investment in IBM or Kyndryl needs their head examined.

  21. Anonymous Coward
    Anonymous Coward

    I worked with IBM for the first time a few weeks ago

    The toxicity was amazing. They didn't say anything illegal but wow they were fishing to see if we'd go along with the murky stuff..

  22. Bluck Mutter

    song remains the same

    So I worked there for 15 years (last year was 2019), was brought in as a Lead Consultant to spearhead a small division, grew to 30 consultants worldwide.

    The type of work we did (wont detail) was unique in the industry and when you needed us, you really needed us...extremely large companies/govt agencies with mission critical work loads.

    Got RA'ed in 2019...my boss didnt even know, wasn't consulted but once you are marked for death, that's it.

    The sole criteria for my redundancy (actioned by some faceless bean counter) was that I was old (59) and was paid a good wack. Termination time. Reason for termination confirmed via a finance insider I knew.

    Belonging to a disbursed world wide group meant the money trail/income recognition for our work was opaque but if the faceless bean counter had done his job, he might have noticed, for example, that for the last two month project I did, I was billed out at $US 1 million and the customer (a top 3 multi-national insurance company) was only too happy to pay that to get them out of a big hole.

    So it wasnt as if I didnt have skills, was useless or not bringing in the dollars.

    Fast forward 1 year and all the rest of my group had left of their own volition. If I could be let go then they easily could be so better to leave on their own terms.

    IBM closed the division down and doesn't offer that service any more (cause the skills needed didn't exist in India), noting that the work we did was equally as applicable to onperm and cloud... so not a declining legacy service issue.

    Summary: Due to a spread sheet jockey using a simple formula of age and salary, IBM lost a unique consulting group that was extremely profitable.

    Bluck

    1. Potemkine! Silver badge
      Flame

      Re: song remains the same

      I'm always amazed how beancounters always think in term of cost and never in term of incomes, and how they don't care to bleed incomes if they can save a few costs.

      This is a good sign such companies are going to the grave, not without giving a lot of money to the C-suite and shareholders.

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