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    Highlights—May 21, 2005
  • News from the Communications Workers of America, The Union for the Information Age: Alliance@IBM CWA Local 1701 to Join in Global Day of Action. Workers Worldwide to Protest IBM Job Cuts. Excerpt: On Monday, May 23, the Alliance@IBM, CWA Local 1701, will join with unions, work councils and IBM employees worldwide in a show of solidarity to protest of IBM’s plan to slash 10,000 to 13,000 jobs. Around the globe, unions and employee groups are planning individual actions and will coordinate them together, and will issue a joint statement on May 23 condemning IBM’s action.
    Lee Conrad, national coordinator of Alliance@IBM, said, “There is widespread concern and anger over the announced job cuts and restructuring. Many employees believe that the job cuts are being used to appease Wall Street and boost the company’s stock price, at the expense of workers, our families and our company. Employees also are asking how IBM can fire 13,000 employees while simultaneously buying back $5 billion in stock,” he said. In the United States, Alliance@IBM members and co-workers will join in the following activities on May 23.
    • Wearing black and blue to signify the pain caused by job cuts.
    • Taking a 10 minute “silent” break at 1 pm EDT (Noon Central, 11 am Mountain and 10 am Pacific).
    • Retirees will call IBM chief executive officer Sam Palmisano and ask for support for employees and retiree concerns.
    • Spouses of terminated employees will e-mail or write to Palmisano detailing the effect that the job loss has had on their family.
  • Union Network International (UNI): Joint Statement on IBM's Restructuring and Job Cuts From IBM unions, work councils and employees worldwide. Excerpts: We, the Trade Unions, Works Councils and employee representatives at IBM worldwide, issue this joint statement expressing our grave concern over IBM's recent announcement of job cuts of 10,000 to 13,000 employees worldwide. We believe the restructuring proposed by IBM senior management is the wrong direction for employees, the company and its customers. Let us not forget that IBM is a wealthy and successful company. 1st quarter profit for 2005 was $1.4 billion and $9 billion for the whole of 2004. It increased the dividend to its shareholders, recently bought back $5 billion in IBM stock, and acquired 19 companies in 2004.
    As employees and employee representatives we call on IBM to do the following:
    • Timely and faithful full disclosing and transparency of the restructuring plans.
    • Negotiate and consult with all Unions, work councils and employee representatives.
    • Explore cost cutting with employee representatives that doesn't involve job cutting.
    • Cease involuntary force-outs.
    • Respect the employee and the right to organize and bargain collectively.
    • That wages and working conditions be equal for equal work, wherever the job is located in the world.
    • Re-training programs for those threatened with job loss
    We, the undersigned Trade Unions and Work Councils, STAND TOGETHER to defend the interests of IBM employees worldwide and to help build the future of IBM and our customers.
    LBC-NVK union of IBM Belgium
    Sif IBM Sweden
    IBM Europe Works Council: Risto Salmela
    CNE union representatives at IBM Belgium
    IG Metall Stuttgart Germany
    SETCA-BBTK union of IBM Belgium: François Mougenot
    CGT IBM France: Mr. Paul Desaigues
    FTM-CGT France (Fédération des Travailleurs de la Métallurgie, the metalworkers trade union): Mr. Christian Pilichowski
    Alliance@IBM/CWA USA: Linda Guyer, Lee Conrad
    Union Network International
    Verdi Germany
    Amicus UK: Peter Skyte
    Communications Workers of America AFL/CIO: President Morty Bahr
    Japan Metal and Information Workers Union IBM Chapter President Tsuneo Higa
    IBM Italy National Co-ordinating Body of Labour Union Representatives
    Dutch Federation of Labour Unions (FNV)
    UNSA IBM France: Mr. Pierry POQUET
    IG Metall HQ
    Sif union clubs at IBM Svenska AB
    CF union club at IBM Svenska AB: Anders Melin
    Vorsitzender des Betriebsrates IBM Austria Works Council: Dr Martin Rennhofer
    Toimihenkilounioni / Union of Salaried Employees TU: Leskelä-Mustonen Oili
    Local 911, CEP Representing workers in ISM Saskatchewan Division IBM Global Services Canada: President Gary Schoenfeldt
    UFICT CGT Metallurgie: Mr. Fabrice Fort
    CFDT: Michel Peraud
  • St Louis Post-Dispatch: IBM agrees to pay $314 million to settle pension claims. By Michael Shaw. Excerpt: In a hearing that took less than five minutes at the federal courthouse in East St. Louis, IBM agreed Thursday to pay $314 million to settle claims that it shorted thousands of workers when it switched pension plans in the 1990s. Letters will go out to about 275,000 former and current IBM workers within two weeks, informing them of the settlement and offering them a chance to object. But the computer giant and attorneys suing it have been unable to reach an agreement on the crucial issue of a lawsuit that has drawn national attention - the formula in the company's "cash-balance" pension plan. If it loses, IBM could be liable for up to $1.7 billion, attorneys said.
  • The Herald (Scotland): IBM to ditch extra 70 staff in south Pacific. Excerpts: IBM is to slash more than 70 consulting jobs in its Australia and New Zealand operations in a move the tech giant said yesterday was not connected to the 10,000 to 13,000 global redundancies announced earlier this month. Across the two southern Pacific nations, IBM employs around 2000 workers in its consulting division. Around 70 jobs are expected to go in Australia, but only two staff will be made redundant in New Zealand. [...] Meanwhile, reports emerged yesterday that around 50 former IBM employees based in China have resigned since the $1.75bn purchase of Big Blue's PC division was announced last December. The article in Digitimes, which was widely reported on the internet, claims that the figure represents about one third of the employees at IBM China. The Digitimes article also said that IBM had been losing market share in notebooks in China during the last two quarters, with HP taking the lead.
  • Duke Energy Employee Advocate (www.DukeEmployees.com): Waivers Can be Beaten. Excerpts: What if a corporation illegally took pension money from an employee? What if earned medical coverage was also illegally taken from the employee? The corporation could potentially be liable for hundreds of thousands of dollars, and in some cases, over a million dollars. This potential liability could be per employee of an affected class. It is easy to see why executives are happy to give an employee a few thousand dollars to sign away all legal recourse.
    But sometimes greed takes control of the corporation and the documents are loaded up with every outlandish stipulation imaginable. These documents may be so fanciful that they are not even legal. Indeed, some are not worth the proverbial paper they are printed on. Some documents state that a former employee may not sue for any reason, including a violation of civil rights!
    Often a relatively small amount of money is offered if a laid off employee will sign a covenant not to sue. Corporation bank on workers being willing to sign anything for a few dollars in cash and most are. It really does not matter if the documents are legal, as long as the employees believe they are binding. In that case, many employees think they have no legal recourse because they “signed some papers.” The employee who challenges the agreement may find it to be illegal and not binding. Consider the case of Thomforde versus IBM. IBM laid off Dale Thomforde, who signed a document titled “General Release and Covenant Not to Sue (Agreement).”
  • Wall Street Journal: When Pensions Change Hands, Retirees Can Be Lost in Shuffle. Mergers Shift the Obligation To Pay, Leaving Oldsters Baffled if Problems Arise. 'Please Repay All You Received'. By Ellen E. Schultz. Excerpts: For 18 years, Charlie Craven, a retired mine supervisor in Tucson, Ariz., received a pension of $348.48 a month. But in late December, instead of a check, he got a letter saying an audit showed he was receiving the benefit in error."You must repay the overpayment of $18,363.44 in one lump sum by January 31, 2005," said the letter from the pension administrator. "If you are unable to make a one time lump sum repayment and wish to set up a repayment plan, your payments are as follows: $1,530.29 per month for (12) months." The letter added: "If you do not comply within the stated timeframe, the plan sponsor may take additional steps," such as reporting the "overpayment" to tax authorities or taking "more formal collection action against you."
  • Associated Press: Pension Deaths Impact Workers' Retirement. By Eileen Alt Powell. Excerpts: Traditional pension plans provide workers with a set amount of money each month when they retire. Workers generally accrue less retirement money in hybrid plans, and companies make only limited "matches" to employee contributions in 401(k) accounts. Younger workers who have many years to go before retirement can make up the difference by stepping up their savings. But older workers -- especially those 50 and up -- often face difficult decisions when they find that their pension plans are being changed, because they don't have the luxury of time to catch up. These older workers, experts say, need to study new pension offerings carefully and weigh alternatives that may include working longer or cutting back retirement expectations or both.
    Those were options that Janet Krueger, 53, of Rochester, Minn., faced in 1999 when International Business Machines Corp. converted its traditional pension plan to a cash balance plan. Krueger, a programming consultant with IBM for more than 23 years, had expected to get at least one-third of her salary at retirement, as her father had when he retired from an engineering career at IBM. "When I first looked at it (the new plan) I was in shock," she remembers. "I thought, these numbers can't be right. There must be a mistake." But after talking with IBM human resources personnel and other workers, she determined that the pension she had come to expect wouldn't be there."I calculated that under the cash balance plan, I would have to work until 78 to get the same annuity (monthly benefit) I would have had at age 65 under the old plan," Krueger said. Some disgruntled IBM workers sued the company, alleging that older workers were being discriminated against. Krueger simply quit and, after a number of years of private computer consulting, she has changed careers and is one year away from completing law school.
  • Personnel Today (Great Britain): Graduate claims sex discrimination against IBM. Excerpts: The case of Sophie Dyer who is bringing a claim of equal pay and sex discrimination against IBM has now reached Croydon employment tribunal. Dyer, who is being supported by the Equal Opportunities Commission, claims that she was not promoted alongside other graduate trainees because she had been on maternity leave. As a result she received a lower pay rise than her colleagues and has continued to receive less pay ever since. In addition, Dyer alleges that after coming back to work part-time, she experienced detrimental comments about being part-time, was given lower-level work, an unfavorable assessment and was refused a sabbatical.
  • Providence Journal: CEO Pay is Still on Steroids. By Holly Skar. Excerpts: How would you like a 54-percent pay raise? That's how much pay jumped last year for the chief executives of the 500 largest U.S. companies, according to Forbes magazine. Worker pay is shrinking, the economy is stalling, the trade deficit is growing, and the stock market is below 1999 levels -- but CEO pay is still on steroids. The highest-paid CEO in 2004 was Yahoo's Terry Semel, who hauled in $230.6 million. That's more than $4 million a week. [...] CEO pay of Fortune 500 public companies averaged $10.2 million in 2004, counting salary, bonus, and other compensation, such as exercised stock options and vested stock grants. Full-time-worker pay averaged just $32,594. That's 11 percent less than 1973's average worker pay, of $36,629, adjusted for inflation, although worker productivity rose 78 percent between 1973 and 2004. In 1973, CEOs made 45 times as much as workers, according to pay expert Graef Crystal. In 1991 -- when Crystal said that the imperial CEO "is paid so much more than ordinary workers that he hasn't got the slightest clue as to how the rest of the country lives" -- CEOs made 140 times as much as workers. Last year CEOs made more than 300 times as much. [...]
    While workers are having a tougher time making ends meet, CEOs are getting perks worth more than worker paychecks. CEO freeloaders expect such perks as lifetime use of company jets and chauffeured cars, company apartments, club memberships, sports tickets, financial planning, personal assistants, and more. In CEO World, the more money you make, the less you should have to spend. While worker pensions are increasingly unavailable or unreliable, CEO retirement gives new meaning to "the golden years." CEO robber barons are increasingly stashing their loot in guaranteed pensions, deferred compensation, guaranteed consulting fees (no actual consulting necessary), and other post-retirement perks and compensation, to avoid shareholder scrutiny and sidestep the new rule for companies to treat stock options as expenses. As Lucian Bebchuk and Jesse Fried, co-authors of Pay Without Performance, explained in a 2004 report, "camouflaged" compensation generates less outrage, is less tied to performance, and "allows executives to reap benefits at the expense of shareholders." Making matters worse, CEOs earning more than their fair share are being rewarded with huge tax cuts.
  • Salt Lake Tribune: Pension-fund trustees challenge corporate America. By Robyn Blumner. Excerpts: Where is the new voice of the American worker? Could it be coming from Wall Street? For average wage earners in the United States, the beginning of the 21st century has been an exercise in running hard just to stay put. Despite productivity gains, wages have been stagnant for all but the highest compensated, and a larger share of health care costs, retirement risks and the national tax burden has been hoisted onto their narrow shoulders. The promise of getting ahead every year is about as remote as an honest presidential campaign.
    But there is one bright spot in all this gloom, and that is the power wielded by the trustees of huge pension funds who believe it is part of their fiduciary duty to invest in companies that take the long view and treat their workers as assets. Since the scandals involving Enron, WorldCom and other now-famous corporate cheats, pension trustees have become bolder in demanding governance reforms and other changes at the companies in which they invest. Nationally, public-employee pension funds control $2.3 trillion. Another $400 billion is in pension funds managed by unions. Obviously, political issues must not override sound investment decisions, but part of the calculation for investors should be the correlation between a company's long-range economic prospects and its treatment of workers and the environment. There is financial risk in being a polluter or treating workers as dispensable cogs, and reform-minded pension-fund managers are beginning to make investments with this in mind. [...]
    All this is hopeful. Corporate America may be deaf to its employees, but the combined pension money of those workers has bullhorn potential. As we have seen with the demise of United Airlines' pension plan, the era of defined-benefit pensions is coming to a fast close. There may be only a short window for workers to use their collective financial clout to make changes in the running of large companies. Right now, this seems like the only game in which workers still have a player on the board.
  • Washington Post: Retirement's Unraveling Safety Net. Social Security Is Least of Newer Generations' Worries.By Dale Russakoff. Excerpts: If it's a clear morning, you can count on seeing 80-year-old Junior K. Paugh strolling streets that tell his life story: Propeller Drive, Fuselage Avenue, Cockpit Street, Compass Road. He's been here more than 60 years, ever since aviation pioneer Glenn L. Martin put him to work making seaplanes and bombers at the defense plant down the road. Franklin D. Roosevelt was president and Martin himself walked the factory floor, urging on workers as the nation went to war. Out of that perilous time came Paugh's now predictable world. He never is short of money, thanks to Social Security and his company pension that will last as long as he does. Health care costs him next to nothing, thanks to Medicare and retiree health insurance. His Baltimore County home is long paid for, thanks in part to a below-market price of $4,400, a result of wartime subsidies for defense-related housing construction. "I feel completely secure," says Paugh, no small triumph for the third of 13 children born to farmers in Depression-era Appalachia. The triumph is not only his but also the country's -- the fulfillment of a New Deal vision of cradle-to-grave security, underwritten by the federal government and large industrial employers.
    That vision is being supplanted by one President Bush calls the Ownership Society, in which the burdens of economic security -- and, the president hopes, the rewards -- shift back to individuals. Social Security is only one aspect of the shift. The safety net big companies wove for Paugh's generation -- long-term employment, pension security, retiree health insurance -- has been giving way for so long that its unraveling is mere background accompaniment to Washington's noisy debate over Social Security. But in the lives of most middle-class families, it stays in the foreground, inseparable from the Social Security discussion. [...]
    Until now, financial planners have likened retirement security to a three-legged stool: employee pensions, personal savings and Social Security. For the Paugh grandchildren, the savings leg is effectively gone, reflecting a plunging personal savings rate nationally. In place of Junior Paugh's pension, they have 401(k) plans, under which they -- not employers -- bear the risk and responsibility of investing enough for retirement. And under Bush's Social Security proposal, their promised benefit could drop significantly.
  • Forbes: SEC Targets Pensions. By Neil Weinberg. Excerpts: Many pension consultants fail to disclose conflicts of interest to their clients and accept undisclosed compensation from money managers and brokerages, according to the results of a U.S. Securities and Exchange Commission study, which were released this morning. The report is the result of an 18-month investigation by the SEC's Office of Compliance, Inspections and Examinations into pension consultants, who advise public and private pension funds about how to invest trillions of dollars in assets and which money managers to hire. It comes in the wake of long-held suspicions that the 1,700-member pension consulting industry operates a "pay-to-play" system in which the advice it dispenses to pension funds is tainted by its own financial interests. [...] Among the firms the SEC reportedly requested to submit information in 2003 are Mercer, Callan Associates, Segal Investment Solutions, Watson Wyatt and Wilshire Associates.
  • Denver Post: Calendar "exposes" United pension fix. Excerpt: Five current and former United Airlines flight attendants are showing skin to expose the lowered expectations they face since the company shed its pension obligations. The women, aged 55 to 64, pose in various states of undress amid captions that make light of their lost pension dollars in the 2006 Stewardesses Stripped (of their pension?) Calendar. [...] Baker, who worked for United from 1967 to 2003, expects to lose as much as half of her $2,800 monthly pension.
  • Jim Hightower: Fattening the Rich at Our Expense. Excerpts: In these tough economic times, when the wages of America's working families are not even keeping up with increases in the cost of living, I can't tell you how downright inspiring it is to see the White House and congress taking bold action to provide relief. Yes, thanks to our dedicated political leaders, the government will no longer deduct estate taxes from your multimillion-dollar inheritance, leaving you and all other rich heirs free to grab every dime left by your Daddy Bigbucks when he kicked the bucket. What? You don't have a Daddy Bigbucks? You're not getting a multimillion-dollar inheritance? Well tough luck, sucker, for Washington's relief package does nothing for you.
    Fewer than one percent of people who died last year paid any estate tax at all. Indeed half of the revenue generated by this tax comes from estates valued at more than $10 million. This is why Washington's repeal of the tax has been dubbed the "Paris Hilton Benefit Act." While the estate tax is paid only by the richest of the rich, those people have recently become fabulously wealthier, so the tax on their wealth produces lots of money for our public treasury. It's calculated that total repeal of the tax, as pushed by Bush and congressional leaders, will end up taking hundreds of billions of dollars out of our treasury.
  • Yahoo! Message Board posting by Stephanie Overby. Full excerpt: I hope I won't offend anyone by posting to this group. The charter said members of the press were welcome. I'm working on a story on the supposed "insourcing" of IT jobs that JPMorganChase had outsourced to IBM. Would like input from anyone who can tell me (on or off the record) what the experience has been like for employees. Thank you. Stephanie Overby, CIO magazine, 508.988.7521.
Coverage on H1-B and L1 Visa and Off-Shoring Issues
  • Free Press: Bill Moyers blasts CPB Chairman Tomlinson. Excerpts: In a speech before 1,400 media activists, television journalist Bill Moyers lambasted Kenneth Tomlinson, chairman of the Corporation for Public Broadcasting (CPB), for hijacking public broadcasting to serve a partisan agenda. "I simply never imagined that any CPB chairman, Democrat or Republican, would cross the line from resisting White House pressure to carrying it out for the White House," Moyers told a packed room at the National Conference for Media Reform. "And that's what Kenneth Tomlinson has been doing." Tomlinson, a staunch Republican, has launched a personal crusade aimed at "eliminating the perception of political bias" in PBS programs. He has covertly promoted right-wing programming and tried to install his political allies to CPB's board and executive offices. He even contracted an outside consultant to monitor Moyers' weekly PBS news program, "NOW with Bill Moyers," for signs of liberal bias.
  • MarketWire: IBM Press Release: IBM Expands Services Delivery Capacity With New Center in Dalian, China. Excerpts: IBM today opened a new Global Services Delivery Center in Dalian, north-eastern China, significantly expanding its existing operations to meet the growing market demand for business process transformation and improved technology management services. [...] The new IBM Global Services Delivery Center in Dalian offers Business Transformation Outsourcing (BTO) services, which involves the transformation and delivery of business processes in key business functions such as customer relationship management (CRM), finance and accounting, human resources and procurement. Previously, the services operations in Dalian had delivered CRM-related business process services. The new center will enable IBM to extend these services to clients, who are looking to improve customer satisfaction, reduce transaction costs and increase revenue opportunities through improved cross-selling and customer retention. The BTO CRM service offerings include order management, customer care and call center operations.
  • SiliconIndia: IBM headcount in India close to 25,000. Excerpt: IBM's headcount in India is inching closer to the 25,000 mark as the firm has ramped up its operations aggressively over the last few quarters. IBM increased its India employee base to 23,000 as of end-2004 compared to 9,000 at end-2003, a growth of about 150 percent, said Shanker Annaswamy, Managing Director, IBM India. The company continued to grow its employee base, Annaswamy said.
  • Durham Herald-Sun: IBM, colleges: More top students needed. Excerpts: With a critical shortage of Information Technology workers projected in the coming years, it's crucial that university computer science departments do all they can to attract top students to the field, a local IBM official said Tuesday. At IBM University Day in Research Triangle Park on Tuesday, leading IBM officials and university professors from across the region gathered to discuss new ways of marketing computer careers to up-and-coming students.
    • "dave49_98" comments. Excerpts: This week, after IBM has announced their annual firing of 15,000 employees, and the new head of HP announced firings of 15,000, we see this hilarious article. [...] Imagine that. IBM leads in firings, benefit cuts and pension elimination, and on the vault new grads complain about IBM offers consistently 30% below the competition, and IBM wonders why there is no one interested in IT. Are they daft? They actually have a vice president of IBM's Academic Initiative? How many VP of firings do they have? Unbelievable.

Vault Message Board Posts
Vault's IBM Business Consulting Services message board is a popular hangout for IBM BCS employees, including many employees acquired from PwC. Some of this week's posts follow.
  • "Can you believe" by "CandorSense". Full excerpt: That a lot of IBMers would have said the same thing as you, about IBM as you have said about PWC? And if indeed the entire acquisition was botched, wouldn't it be fair to say that at least some of the blame, even if we assign most to IBM, could be assigned to PWC employees coming in with unhelpful preconceptions and bad attitudes? If you come in with the attitude that you are superior, what do you expect the reaction to be? You could look at our numbers pre 2002 and say we had been pretty damn successful too and we also had lots of smart people in our ranks. As for professionalism, that is one are where my personal experience was that PWC people, particularly AP and Partners, had some pretty unprofessional practices and aloof attitudes that non-partners were dogs, that certainly wouldn't seem to help the situation. Maybe?
  • "Insane travel policy becomes more strictly enforced" by "ibmigs". Full excerpt: This policy will be enforced, so please read and be aware. In the past, there have been numerous exceptions submitted on expense reports across the practice. These reports will be impacted by this new policy (only allowable amounts will be approved) and will impact you if the amounts are beyond the allowable guidelines. Please read: IBMers who incur business-related expenses are expected to understand and comply with IBM's expense policies and reimbursement guidelines, which help us to manage these costs on behalf of both our clients and ourselves. These guidelines are appropriate and competitive, based on regular benchmarking of the travel industry, competitive practices and tax regulations within each country.
    For expenses submitted on/after June 1, IBM will pay the costs of hotels, meals and other related expenses up to but not exceeding IBM expense guidelines; employees will be responsible for the excess. Expenses that exceed the guidelines will be eligible for reimbursement on an exception-only basis. Exceptions will be granted sparingly and only after appeal by the individual who incurs the noncompliant expense. Exceptions on these and all other expenses (such as airfare) will be monitored on a regular basis, and appropriate management teams will be notified of results.
    This policy adjustment is occurring now because we are experiencing a large amount of expenses that exceed guidelines. Upon review, the vast majority of these expenses appear to lack the clear business rationale to justify the added cost. This is not in keeping with IBM's best practices around travel and business-related expenses. I want you to be aware of this issue, and the policy enforcement plan that is occurring as a result. Please make sure your teams are aware as well by forwarding this e-mail to them no later than Thursday, May 12.
    More detailed information will be posted on the Manager Portal and local Travel websites. Randy MacDonald Senior Vice President, Human Resources.
    • "exactly right" by "BCS_Blue". Full excerpt: this shows two things: a) how little HR and backoffice functions within IBM understand how consulting works, and b) how little these idiots in the backoffice and HR travel -and have to live on the road like the rest of us. in the end, this will only hurt morale further - and, in my opinion, increase the turnover within BCS and IGS. GR and SP do a great job of shooting themselves in the foot.
    • "Incredible" by "ancientblueconsultant". Full excerpt: I am stunned. The BCS GP problems must be worse than I thought. The real surprise to me is that the control of client engagement is being taken out of the hands of engagement management and line execs into HR. I wonder if the executive special AMEX travel line and the other perks are affected as well?
    • "How" by "CandorSense". Full excerpt: Exceptions were always based on: 1. Spending more on a hotel than the local allowed limit; 2. Taking an airfare that was not determined by the TOOL to be In-Policy while yours was marked exception (no use trying to explain why the TOOL says exception); 3. Exceeding the local meal limit; 4. Etc. In the past, if you earned one of these exceptions, you simply explained why. Now, the policy note I saw said after 6/1, these exceptions would be disallowed and you will be reimbursed for the allowed amount. So if I stay at a hotel that charges $150 a night and the local limit is $125, it seems that IBM will reimburse $125 regarding of my reason or excuse. Unless I am willing to challenge each of these up the line which sounds a little career limiting. It isn't going to be pretty.
    • "Sadly" by "CandorSense". Full excerpt: The sad thing is that while saving money is a good thing, telling adults that the exercise of their own good judgment is forbidden is just dumb. A good manager knows that costs like this are controlled through enforcement of something called a Budget and/or good project management. Making it hard for road warriors to make smart choices is a symptom of poor management and procurement people who focus more on their dream contracts than the reality of every day travel. I am reminded of a few years back when I could save $800 a week by flying United and was flagged as an exception because I wasn't flying American. My pleas that it would be hard to explain to the client that I was charging more because IBM hates United didn't get me very far.
    • "Travel Issues Explained" by "Joe Dirt". Excerpts: A simple explanation exists on why we are so lucky to have this system. Corporate IBM is leveraging the spend and travel of the IGS personnel to decrease the costs to corporate IBM. It makes no sense to impose corporate restrictions on a PM. If the project was priced correctly then the "correct" travel should have been taken into account. When we first “implemented” the new airline contracts last year, I called the IBM head of travel and asked them why they had “selected” AMR and Delta as our only two carriers since only one flew into my airport. I argued that as a consultant it should not matter who I used as my time is more valuable so we should have contracts with other carriers as well (United, NWA, etc.). He asked me where I lived and then laughed with the following reply: “ That is your own fault for living where you do..you should move closer to a major hub”. I reminded him that I had four major carriers in my airport and that most all IGS employees are mobile with our job destinations varying by the client. In summary, it was a lesson lost on this jerk.
      While I am complaining, why can you make a reservation in the OTR but not change/cancel? When you do cancel with AMEX, the reservation still shows up as a valid trip in AirWeb. The bottom line is that IBM has moved all of the responsibility for this stuff to the employee to save $. You are still expected to only bill 40 but work 60 at the client and then spend another 10 doing “cost savings work”. All I have to say is 11 months more to my vesting date and then the door is open.
    • "Boneheads in Procurement" by "CandorSense". Full excerpt: Ya....and when I spoke to the guy who sold off our Amex member miles he said I wouldn't believe how much we saved. I said he was right, I wouldn't believe it and of course he wouldn't share the number. Next I inquired what he had factored into his analysis for lost time and effort amongst billable consultants who can cost IBM hundreds of dollars every week by simply working one less hour because they are pissed or tired. Suffice to say, I think he got his business acumen from a cracker jack box. He didn't even know what I was talking about.
    • "IBM idiocy... once again" by "howard stern". Full excerpt: This is an example of IBM once again not knowing how to run a consultancy. And as Candor says, not respecting the judgment of people who have to make decisions on a fly. As a matter of principle people should not subsidize IBM. Also, requiring people to stay in hotels 20 miles away to stay in policy when the local hotel is a few dollars more AND the client is willing to pay for is sheer stupidity. Why not go after the abusers and leave the rest of us alone. Then - cost savings could be achieved by firing the HR monitors! The overhead people are what the 32% overhead support. Get rid of these HR, Orwellian monsters and go after abusers. That is a strategy.
  • "A History Lesson for Junior" by "Dose of reality". Excerpt: First of all, no one has made the case that PwC was paradise before the takeover. However, it did have a balance between its go-to-market strategy, its resource strategy, and its market reputation, that was commercially successful and beneficial for staff. The complaint against BCS is that compensation and resource quality have been ratcheted down, yet we are trying to position ourselves as a premium consulting organization. Better performance is not rewarded with better pay and there are too many overhead leeching mouths to feed. With utilization targets almost 20% higher than they were in PwC, there is no time left for either internal or external practice development. The bureaucracy is a huge drain on productivity and impediment to speed to market. All of these things make the career opportunities here worse than they were at PwC. That is what is responsible for the complaints, and they run the gamut from personal to clinical and strategic. Commercial viability is in a free fall – you don’t have to be a blue chip consultant to see that.

Coverage on Social Security Privatization
  • Jim Hightower: Bush's Reality. Excerpt: For example, George keeps insisting that the economy is booming, and his top economic official, Treasury secretary John Snow, has even exclaimed that the economy is in a "sweet spot." Well, yes, if you're a CEO – corporate profits are zooming, exceeded only by CEO pay. But the reality for working families is that their wages aren't even keeping up with the cost of living and their health care is being cut (assuming they have any coverage at all). In fact, only a third of Americans think the economy is improving – and they're the only ones Bush ever talks to. Likewise, George is still pushing his privatization plan for Social Security, even though only 25 percent of the people think he's doing the right thing. But, after all, Bush and his close corporate coterie don't need Social Security and can't imagine the anxiety they're creating for the majority who do.
  • Los Angeles Times: Now Is a Bad Time for Private Accounts. By Michael Hiltzik. Excerpts: This is where Bush's "ownership society" falls short. As the president describes it, the "ownership society" sounds like a pretty sweet deal. We'll own our retirement savings, through individual Social Security accounts, and our healthcare, through medical savings accounts. We'll also own our home, or whatever sliver of equity we could afford. But as the economist Robert J. Schiller wrote in a recent issue of the Atlantic Monthly, Bush's proposals "don't just encourage personal ownership — they also increase personal risk." Risk is the one thing, he notes, that U.S. workers already have too much of. Workers are changing jobs more often and spending longer periods out of work, earning wages that are growing at slower rates than at any time in recent memory, while paying for more of their healthcare and retirement themselves.
    The social safety net that Bush is trying to destroy, by privatizing Social Security among other steps, was the product of a sea change in the American understanding of the individual's place in the economy. In the 1930s, the evidence became inescapable that economic conditions could render people winners or losers without regard to their personal effort or character. The government responded with Social Security. Roosevelt, whose humaneness Bush so casually denigrated in his astonishingly ignorant speech about Yalta last week, remarked during the 1940 Democratic National Convention upon the "war against poverty and suffering and ill-health and insecurity" then being waged by the government, "a war in which all classes are joining in the interest of a sound and enduring democracy." "All classes" aren't joining in anything today. Individual Social Security accounts are the very antithesis of the common war against poverty and insecurity that FDR proclaimed. Although Bush maintains that it's necessary to radically alter Social Security because "these are changing times," the truth is that the economic challenges facing average Americans are starting to resemble those of the '30s and '40s much more than those of the '50s and '60s. The concept of shared responsibility that took root in the postwar period is giving way to the notion that everyone under the pay grade of, say, chief executive is lucky to earn whatever trickles into his or her pockets. [...]
    Nor were these pensions altruistic giveaways. The growth of corporate retirement programs after the war was advantageous to employers and employees alike. The former got to defer what they would have paid as cash salaries and wages by promising to pay them as retirement benefits decades in the future; the workers were guaranteed (supposedly) an income stream for old age. The federal government acknowledged the trend by positioning Social Security as one leg of a three-legged retirement stool — a secure basic benefit to be supplemented with private pensions and personal savings. Meanwhile, employers used their pension reserves to pump up their balance sheets and even raided the funds for cheap capital whenever they could claim they were actuarially overfunded. When the funds went into the red, they started shifting the losses to retirees and taxpayers by reneging on benefits and ceding their liabilities to the federal government. If link is broken, view Adobe Acrobat version [PDF--29KB].

New on the Alliance@IBM Site:
  • Alliance@IBM: Attention IBM employees: IBM is blocking e-mail to and from the Alliance@IBM e-mail address endicottalliance@stny.rr.com from inside the company. Please send your job cut information and other correspondence from your home e-mail. You can also contact us the following ways: Phone 607 658 9285 or Fax 607 658 9283.
  • Press Release: Legal Decision Opens the Doors for Age Discrimination Claims Against IBM. Excerpt: Although Tuesday's decision applies only immediately to Thomforde, whom IBM fired in 2001 as part of a reduction in force, the decision may have ramifications for a collective action currently pending against IBM in California. Jeffrey Neil Young, an attorney with the Topsham, Maine law firm of McTeague, Higbee & Case, represents several hundred former IBM employees in a pending class action against the company. According to Young, "the Eighth Circuit decision ultimately could permit as many as 20,000 former IBM employees let go since 2001 to sue the computer giant for age discrimination."
  • Job Cuts Status & Comments Page. Excerpts: Job cuts are coming. Information needed: What is Your location? How many job cuts at your location? What locations are cutting jobs? Name of Division and Business Unit? Some sample submissions follow:
    • Another tactic being used in Boulder is forced 2 weeks unpaid time off between now and the end of June. Looks like all contractors are affected. I know of 9 in my dept. Please post anonymously. Thanks.
    • My wife was just laid off from IBM. She works remotely based out of IBM - Charlotte, NC. They gave her 30 days. Some other workers that are being laid off are remote as well. Those jobs are probably the ones that can be done in India.
    • It appears more than IGS is being affected. I was told today, by my manager, that his funding had been cut greatly effective 7/1/2005 and to start looking for a new job within IBM. I asked and was told this is "not" a resource action. I assume it will be after 7/1, if a new job position within IBM has not been found by those of us affected (8 or more out of 16). Of course, we will work diligently and intensely to exceed our numbers, so we will look good as we are kicked out the door.
    • They're letting all Sykes contractors (more than 10) go from my project (NextGen Software Clearing House). They blame the poor Q1 results. We work in RTP.
    • Today, I was notified that I am part of an IBM Global Services BCS layoff. I'm in Atlanta GA. No others of my acquaintance have yet indicated that they are affected, but it's early. Indeed, a peer of my manager claimed ignorance of the entire action. Apparently, few believed the cuts are taking place beyond the other side of the pond. The package I received today indicated that 19 Business Transformation Outsourcing employees plus about 150 BCS Public Sector employees are affected. The locations of the other employees is unknown to me.
    • I do not have any confirmed info beyond what I've already seen posted to this site about IGS layoffs, but in 5 years at IBM I've learned that the "rumor mill" is usually very close to correct in what eventually happens...and there's been so much "spin" about the layoffs by IBM in the news that I can't help but believe... May God forgive the execs who have chosen profits over people. Here's what we're hearing in Austin: 1) 10% of the IBM Austin employees will be laid off --- mostly IGS and deep, deep cuts in all areas of Software Group. 2) There is already in place a freeze on interdepartmental transfers, so even if there's a job you want in another dept... 3) The layoffs will happen by end of 2Q.
    • UK - On Monday several executives stated the UK IGS numbers in an employee meeting at the UK HQ (though they were confusing). This was the first time numbers had been disclosed, despite the question being asked via the "Employee Consultation Committee". Many questions to management remain unanswered and the deadline for expressing interest in a voluntary package has passed. 1,000 (from a total of 12,000) IGS employees in the UK will go (Project Quantum). This is in addition to (up to) 650 (from approximately 2,000) UK staff that work in pan-EMEA roles (Project Atlantic). Also mentioned was a figure of 50 for the Netherlands. It is hoped these will be voluntary following the announcement on 14 April for expressions of interest (which the first post here details). As has been stated already decisions will be communicated from May 17, employee acceptance by June 6, and a leave date of June 16. Much work is being transferred to low-cost labour locations such as Bangalore (India), China, and South Africa. IDC (Integrated Delivery Centres) are to be located in some of these locations.
    • 411 people were laid off on the America Express account. The year 2002 when IBM took over it was reduced down from 3,000 people to 2,500 people plus all of the 5,000 programmers were let go. The last lay off numbers were 1,100 people down to 968 so that brings us down to 557 running all of American Express systems around the world. Our functional team known as the Professional Technical Services was reduced by 111 people leaving only 18 people left with database/os expert knowledge. American Express is nervous and I have heard rumors they are going to pull the contract. This information was from Financial Services of American Express. They stated how is it possible IBM will be able to work this contract's service level agreements and follow the sarbanes oxley law at the same time.

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