IBM is speeding things up. Round 2 is coming fast and WARN filings are apparently needed:
https://www.channelfutures.com/business-models/ibm-job-cuts-to-impact-more-than-240-workers-in-california
Last day for 240 works in California will be 7/20. With the 30 day notice that says for things happening very soon
@ 2wfq+15pFRKjz
In order to bring $250K per employee would require to slash the number of admin and management positions.
I am in services (Cloud Lab Services), I bring in 450K a year delivering services. Add the Sales team, admins and an over-bloated management structure and you can easily see that this is going to be a challenge even with a large number of people billing.
If IBM is truly looking to restructure, I would expect Krishna to aim for a revenue per employee of approx 250k per. NOTE IBM’s performance over the years. He will definitely trade low margin revenue to shed low revenue parts of the business
https://www.mbiconcepts.com/comparing-revenue-per-employee.html
This is not round 2. It is still round 1. WARN act allows employer to pay in lieu of notice. In other words, an employer can give 0 day notice but pay employee 60 days. IBM filed the notice on 5/21 with 60 days notice to 7/20. This date doesn’t matter because IBM pays total 4 months.
If IBM did spin off some services I would expect it to look very much like the HPE/CSC deal. HPE gave up 20 billion in revenue for approx 13.5 billion in shareholder value. That value was delivered via cash, pension liability absorption, new stock, Debt absorption, and off loading headcount. That’s approx 67 cents on the dollar. Not a bad trade considering the margins If you equate that to head count it nets out (all things being equal) to approx 85-90k worth of folks impacted
1hqc. You most likely got caught in the Covid exception. The Gov of California allowed companies to go back to 30 days warning if there was some covid justification.
1mkw. Why do you think there will be two more waves? I agree with you that commodity content (services, HW, and SW) will be sold off
The suspension is only for unanticipated covid-caused layoffs. So expect a class action lawsuit because this layoff was planned before the covid crisis so they should have given everyone 60 days in California.
I am in California and received only one month notice on 5/22 and 6/22 would be my last day at IBM. This has to be separate then the 5/22 list.
Note- WARM act requiring employers to provide 2 months notice in CA is currently suspended due to COVID. https://www.laboremploymentlawblog.com/2020/03/articles/coronavirus/california-warn-act-notice-requirements/
There will be two more waves of layoffs before end of year. Perhaps some selling of Assets/services that IBM want to get out of.
The calif warn act requires 60 day notice. I believe IBM notified these workers in May just like everyone else who got 30 days and have to leave 6/22