Welcome to IBM Employee News and Links
"News and links for IBM employees, retirees, ex-employees, and persons interested in pension, retirement, off-shoring and corporate governance issues."
Search:
Web This Site

Quick Links:
  Get involved!
  Press articles
  Important Links
  Insider trading
  Lou's Contract
  Total Compensation
Subscribe:
  Add or delete ID
  Change ID
  Contact site owner
Previous Highlights:
  Current
  April 21, 2007
  April 14, 2007
  April 7, 2007
  March 31, 2007
  March 24, 2007
  March 17, 2007
  March 10, 2007
  March 3, 2007
  February 24, 2007
  February 17, 2007
  February 10, 2007
  February 3, 2007
  January 27, 2007
  January 20, 2007
  January 13, 2007
  January 6, 2007
  December 30, 2006
  December 23, 2006
  December 16, 2006
  December 9, 2006
  December 2, 2006
  November 25, 2006
  November 18, 2006
  November 11, 2006
  November 4, 2006
  October 28, 2006
  October 21, 2006
  October 14, 2006
  October 7, 2006
  September 30, 2006
  September 23, 2006
  September 16, 2006
  September 9, 2006
  September 2, 2006
  August 26, 2006
  August 19, 2006
  August 12, 2006
  August 5, 2006
  July 29, 2006
  July 22, 2006
  July 15, 2006
  July 8, 2006
  July 1, 2006
  June 24, 2006
  June 17, 2006
  June 10, 2006
  June 3, 2006
  May 27, 2006
  May 20, 2006
  May 13, 2006
  May 6, 2006
  2006 Stock Meeting
  April 22, 2006
  April 15, 2006
  April 8, 2006
  April 1, 2006
  March 25, 2006
  March 18, 2006
  March 11, 2006
  March 4, 2006
  February 25, 2006
  February 18, 2006
  February 11, 2006
  February 4, 2006
  January 28, 2006
  January 21, 2006
  January 14, 2006
  January 7, 2006
  December 31, 2005
  December 24, 2005
  December 17, 2005
  December 10, 2005
  December 03, 2005
  November 26, 2005
  November 19, 2005
  November 12, 2005
  November 5, 2005
  October 29, 2005
  October 22, 2005
  October 15, 2005
  October 8, 2005
  October 1, 2005
  September 24, 2005
  September 17, 2005
  September 10, 2005
  September 3, 2005
  August 27, 2005
  August 20, 2005
  August 13, 2005
  August 6, 2005
  July 30, 2005
  July 23, 2005
  July 16, 2005
  July 9, 2005
  July 2, 2005
  June 25, 2005
  June 18, 2005
  June 11, 2005
  June 4, 2005
  May 28, 2005
  May 21, 2005
  May 14, 2005
  May 7, 2005
  April 30, 2005
  April 23, 2005
  April 16, 2005
  April 9, 2005
  April 2, 2005
  March 26, 2005
  March 19, 2005
  March 12, 2005
  March 5, 2005
  February 26, 2005
  February 19, 2005
  February 12, 2005
  February 5, 2005
  January 29, 2005
  January 22, 2005
  January 15, 2005
  January 8, 2005
  January 1, 2005
  December 25, 2004
  December 18, 2004
  December 11, 2004
  December 4, 2004
  November 27, 2004
  November 20, 2004
  November 13, 2004
  November 6, 2004
  October 30, 2004
  October 23, 2004
  October 16, 2004
  October 9, 2004
  October 2, 2004
  September 25, 2004
  September 18, 2004
  September 11, 2004
  September 4, 2004
  August 28, 2004
  August 21, 2004
  August 14, 2004
  August 7, 2004
  July 31, 2004
  July 24, 2004
  July 17, 2004
  July 10, 2004
  July 3, 2004
  June 26, 2004
  June 19, 2004
  June 5, 2004
  May 29, 2004
  May 22, 2004
  May 15, 2004
  May 8, 2004
  2004 Stock Meeting
  April 24, 2004
  April 10, 2004
  April 3, 2004
  March 27, 2004
  March 20, 2004
  March 13, 2004
  March 6, 2004
  February 28, 2004
  February 21, 2004
  February 14, 2004
  February 7, 2004
  February 1, 2004
  January 18, 2004
  December 27, 2003
  December 20, 2003
  December 13, 2003
  December 6, 2003
  November 29, 2003
  November 22, 2003
  November 15, 2003
  November 8, 2003
  November 1, 2003
  October 25, 2003
  October 18, 2003
  October 11, 2003
  October 4, 2003
  September 27, 2003
  September 20, 2003
  September 13, 2003
  September 6, 2003
  August 30, 2003
  August 23, 2003
  August 16, 2003
  August 9, 2003
  Pension Lawsuit Win
  July 26, 2003
  July 19, 2003
  July 12, 2003
  July 5, 2003
  June 28, 2003
  June 21, 2003
  June 14, 2003
  June 7, 2003
  May 31, 2003
  May 24, 2003
  May 17, 2003
  May 10, 2003
  2003 Stock Meeting
  April 26, 2003
  April 19, 2003
  April 12, 2003
  April 5, 2003
  March 29, 2003
  March 22, 2003
  March 15, 2003
  March 8, 2003
  March 1, 2003
  February 22, 2003
  February 15, 2003
  February 8, 2003
  February 1, 2003
  January 25, 2003
  January 18, 2003
  January 11, 2003
  January 4, 2003
  December 28, 2002
  December 21, 2002
  December 14, 2002
  December 7, 2002
  November 30, 2002
  November 23, 2002
  November 16, 2002
  November 9, 2002
  November 2, 2002
  October 26, 2002
  October 19, 2002
  October 12, 2002
  October 5, 2002
  September 28, 2002
  September 21, 2002
  September 14, 2002
  September 7, 2002
  August 31, 2002
  August 24, 2002
  August 17, 2002
  August 10, 2002
  August 3, 2002
  July 27, 2002
  July 20, 2002
  July 13, 2002
  July 6, 2002
  June 29, 2002
  June 22, 2002
  June 15, 2002
  June 8, 2002
  June 1, 2002
  May 25, 2002
  May 18, 2002
  May 11, 2002
  2002 Stock Meeting
  April 27, 2002
  April 20, 2002
  April 13, 2002
  April 6, 2002
  March 30, 2002
  March 23, 2002
  March 16, 2002
  March 9, 2002
  March 2, 2002
  February 23, 2002
  February 16, 2002
  February 9, 2002
  February 2, 2002
  January 26, 2002
  January 19, 2002
  January 12, 2002
  January 5, 2002
  December 29, 2001
  December 22, 2001
  December 15, 2001
  December 8, 2001
  December 1, 2001
  November 24, 2001
  November 17, 2001
  November 10, 2001
  November 3, 2001
  October 27, 2001
  October 20, 2001
  October 13, 2001
  October 6, 2001
  September 29, 2001
  September 22, 2001
  September 15, 2001
  September 8, 2001
  September 1, 2001
  August 25, 2001
  August 18, 2001
  August 11, 2001
  August 4, 2001
  July 28, 2001
  July 21, 2001
  July 14, 2001
  July 7, 2001
  June 30, 2001
  June 23, 2001
  June 16, 2001
  June 9, 2001
  June 2, 2001
  May 26, 2001
  May 19, 2001
  May 12, 2001
  May 5, 2001
  2001 Stock Meeting
  April 21, 2001
  April 14, 2001
  April 7, 2001
  March 31, 2001
  March 24, 2001
  March 17, 2001
  March 10, 2001
  March 3, 2001
  February 24, 2001
  February 17, 2001
  February 10, 2001
  February 3, 2001
  January 27, 2001
  January 20, 2001
  January 13, 2001
  January 6, 2001
  December 30, 2000
  December 23, 2000
  December 16, 2000
  December 9, 2000
  December 2, 2000
  November 24, 2000
  November 17, 2000
  November 10, 2000
  November 4, 2000
  October 28, 2000
  October 21, 2000
  October 14, 2000
  October 7, 2000
  September 30, 2000
  September 23, 2000
  September 16, 2000
  September 9, 2000
  September 2, 2000
  August 26, 2000
  August 19, 2000
  August 12, 2000
  July 29, 2000
  July 22, 2000
  July 15, 2000
  July 1, 2000
  June 24, 2000
  June 17, 2000
  June 10, 2000
  June 3, 2000
  May 27, 2000
  May 20, 2000
  May 13, 2000
  May 6, 2000
  April, 2000
 

Join your fellow employees who are fighting for your benefits - Join the Alliance!

Retirees, Vendors, Contractors, Temps, and Active Employees are all eligible to become members of the Alliance.


    Highlights—July 9, 2005
  • Yahoo! message board post by Janet Krueger: House legalization of Cash Balance Plans. Full excerpt: The press release the House Education and Workforce committee put out today about their so-called pension reform couldn't be any clearer about their objectives. Read the excerpt below!!! Then CALL Congress and tell them it is simply unacceptable to be this blatant about helping corporations cut long-promised worker benefits.
    During consideration of the bill, the committee approved a substitute amendment offered by Boehner to help resolve the legal uncertainty surrounding cash balance plans, a type of hybrid defined benefit plan that many American workers rely upon for their retirement security.
    "Cash balance pension plans – a type of defined benefit plan that is employer-funded, insured by the PBGC, and portable from job to job – represent an important component of worker retirement security, and they account for more than 20 percent of the premium revenue paid by employers to the PBGC," said Boehner. "Cash balance pension plans are the future of the defined benefit system, and it's critically important that Congress act to resolve the legal uncertainty that is jeopardizing generous pension benefits for workers across the country."
    The cash balance solution is the result of an agreement reached between Boehner and Ways & Means Committee Chairman Bill Thomas (R-CA). It establishes a simple age discrimination standard for all defined benefit plans that clarifies current law with respect to age discrimination requirements under ERISA on a prospective basis. The bill does not establish different rules for hybrid plans or conversions, but merely sets up a simple age discriminatory standard that all defined benefit plans must meet prospectively. The measure also prohibits employers from reducing or cutting any vested benefits workers have earned during a conversion to a cash balance plan.
    "It is important to begin to address the legal status of these retirement plans," said Johnson. "I have many constituents that are covered by this type of plan and are very happy with the retirement benefits they are earning. Legal harassment of these retirement plans needs to stop."
  • Follow-up message board post by Janet Krueger: Act Today! Full excerpt: There are four things you should start with:
    1. Write a letter to the editor of your local paper --- I've attached below the one I sent off yesterday.
    2. Call your two senators and your representative in Washington and tell them you are outraged -- Generally they respond more appropriately to phone calls than to snail mail, and most ignore email. Have the bill number in hand (H.R. 2830) because often the receptionists only classify things by bill number. Make sure you leave your name and your address; many of the people in Washington only listen to people from their district.
      • To find your senators, go to www.senate.gov and choose your state, then pick up the phone and tell them they better not follow along behind the House. Follow up your call with a short letter. Both their phone number and their address is on that site.
      • To find your representative, go to www.house.gov and enter your zip code. Do one more piece of research -- look at the education and workforce committee at http://edworkforce.house.gov/members/109th/mem-fc.htm. If your representative is on the list of 27 republican representatives, s/he needs an extra blast of outrage. If your representative is on the list of 22 democratic representatives, s/he needs an extra thank you. If s/he is not on either list, tell them to please vote no to the bill when it comes to the floor.
    3. Contact the committee with a phone call and a letter at:
      Committee on Education and the Workforce
      U. S. House of Representatives
      2181 Rayburn House Office Building
      Washington, D.C. 20515
      (202) 225-4527
    4. Forward this note to your network of friends, neighbors and colleagues so they can also act.
    If we can generate over 1000 phone calls, Congress will be forced, once again, to back off. Thanks for asking! My letter to the editor:
    Subject: Letter to the editor --- Cash balance plans do NOT need to be legalized!
    In 1999, IBM converted their US pension plan into a cash balance plan. In the process, they cut the benefits of many older workers by as much as 40%.
    A lawsuit was filed against IBM in 1999 by Kathi Cooper charging that the new plan is age discriminatory, as it allows younger workers to accumulate retirement benefits much more rapidly than older workers.
    Late last year, IBM agreed to settle the lawsuit. The settlement agreement calls for IBM to pay workers $1.7 billion if IBM loses their appeal on the legality of cash balance plans, but only $314 million if IBM wins the appeal.
    Today, Republicans in Congress decided to intervene on IBM's behalf. The House Committee on Education and the Workforce just approved a bill to legalize cash balance plans. According to their press release, "Cash balance pension plans are the future of the defined benefit system, and it's critically important that Congress act to resolve the legal uncertainty that is jeopardizing generous pension benefits for workers across the country... Legal harassment of these retirement plans needs to stop."
    This is outrageous! The plans are NOT 'generous'; workers should not be accused of harassment when they seek redress against employers who slash federally protected benefits.
    Congress is doing this retroactively. The bill defines "effective date" as "The amendments made by this section shall apply to plan years beginning before, on, or after the date of the enactment of this Act."
    IBM knowingly broke the law when they cut our pensions. IBM employees deserve their full day in court. Congress should back off and stay out of the fight.
  • Yahoo! message board post by "ibmaccountant": A Perspective on HR2830/HR2831. Full excerpt: I took the latest version of HR2830/2831 to a party of litigation specialists and accountants last night. It quickly became the central topic of conversation of the party, for many reasons. Here's some feedback:
    1. This is certainly a "secret" bill, the press hasn't even discussed it. Why?
    2. This bill certainly flew through committee. Seems like the Republicans (this comment came from a significant Republican contributor) want this passed quickly for some reason.
    3. Since there are no excessive penalties for those corporations who attempt to subvert the law by going "outside of the legal envelope" (like IBM did in 1999) fuzzy terms like "vested" are going to be attacked.
    4. The most creative litigation specialist predicted that any active IBM employee still working by the time this makes law will lose a significant part of their pension. This was reinforced by an actuary's comments. He also gave it a 75% chance that even those who are on a DB plan and already retired may lose their annuity and be converted into a cash balance when IBM (not if) goes outside of the envelope and goes after their money. The law doesn't specifically protect retirees and give violators excessive penalties. Even if it does, companies like IBM can do a 1999 style grab by doing a final amount conversion and not get penalized later. Just because it's against the law doesn't mean that a company shouldn't try to break the law. It's a case of cost-benefit ROI. The Cooper case was mentioned as a "cost of doing business" which still makes the ROI for IBM to be an acceptable business decision.
    5. Every one of the attorneys recommended that anyone close to retirement or past the 30 year mark in IBM should be pulling the trigger ASAP and leaving the company.
    6. One Democrat attorney was overjoyed by the bill. She thinks it will be a great way to recruit new Democrat lifelong voters in 2006. She believes nothing can be done to avoid the rape of employees in American large corporations until maybe the 2006 elections.
    Interesting thoughts. Maybe those few IBMers left inside IBM that think they are safe should start worrying, but few even realize their fate is sealed. Maybe the retirees should start worrying as well!
  • Janet Krueger comments on "ibmaccountant's" post. (The references below refer to the numbers in "ibmaccountant's" post above).
    Regarding point #1: We do not need to allow it to stay "Secret"... That is why I suggest we all start calling both our representatives in Congress, to ask them why they are allowing it to be pushed through, and our local media, to ask them why they aren't covering these outrageous actions... (Btw, did people notice that some of the press articles that first alerted us to this activity have disappeared??? Clearly there are people that want this to stay secret!!!)
    Regarding point #3: A key question to ask, as you contact Congress and the media, is why don't we have legislation that includes real penalties??? I know there has been much speculation and concern about why the Cooper settlement is so low -- it is because current ERISA law only allows redress to the lost income that can be directly attributed to age discrimination, and explicitly does not allow either damage assessments or attorney fees... We should be telling Congress that if they are truly interesting in reform, they should be fixing it so that employees corporations harm by these actions can actually be made whole!!!
    Regarding point #4: This isn't idle speculation! Have you been watching what IBM is doing to pensions in other countries??? Their goal is clearly to cash out of all their long term obligations... For just one example, check the file named "IBM SA Final Future Fund Letter to Pensioners - Apr 2005.pdf" that I uploaded on April 15 this year.
    Regarding point #5: That is an easy recommendation for someone to give who has both a job and secure retirement funds -- I would suggest that people do an overall assessment of their financial situation, including health care, and then look at their job prospects outside big blue, before jumping ship... For many, it is best to wait for a separation package, even though IBM is also trimming those.
    Regarding point #6: She is right in one respect -- if we sit back quietly and do nothing until the next election cycle, nothing but more and more egregious legislation will happen. What scares me is that if we continue to sit quietly, things won't even change in the next election cycle, because most of the public won't realize how many bad things are happening.
  • In a Yahoo! message board post, Janet Krueger responds to this question: Why don't they do a cap on salaries and pensions for the executives and give to the employees who do all the work and they receive all the rewards for the products. No person is worth what IBM is paying their executives. Talk about robbing the people. They should be ashamed of their actions. Has anyone ever conducted an objective study to see if such a cap could adequately fund the gaps in the pension plan? Just curious. Janet responds: It would be difficult to conduct such a study when the disclosure rules enforced by the SEC don't force corporations to fully disclose to their shareholders just how much they are actually paying their executives. There was a presentation done to the IBM Board of Directors in 1994 promising that the cuts to the employee pension plan would be used to fund needed enhancements to executive compensation (IBM at the time felt that they weren't able to attract and retain the top executives that they needed to 'stay competitive') but without full disclosure of what those executives are actually earning, who can tell what employee benefits the excess executives perks could actually finance?
  • The Register (United Kingdom): IBM UK mainframe workers train their South African replacements. By Ashlee Vance. Excerpts: If you're one of IBM UK's highly skilled mainframe specialists, then you may well be out of a job. IBM has shuffled a huge chunk of its mainframe support operations off to South Africa in a bid to cut costs. As a result, some of IBM's highest profile customers will find their critical mainframe support calls traveling south to a staff who recently spent just over 30 days in the UK learning the ropes. On May 5, a number of South African technicians arrived at Heathrow airport and made their way to the Warwick Hilton, a source told El Reg. Over the next few weeks, the staffers went through some basic education exercises and gradually moved up to learn about more complex support functions. Specifically, the South Africans were trained to handle IBM's MVS (Multiple Virtual Storage) - aka mainframe operating system - support. The workers were taught by the very people they would soon replace. [...]
    BM's mainframe systems reside in the data centers of the largest companies in the world and often handle key tasks such as order processing, payroll, billing and other crucial transactions. Our source indicates that many of IBM's high-profile UK customers are not even aware that their support has moved to South Africa."Have the customers actually agreed to the proposed actions?" the source asked. "If so, why are IBM going to great lengths to prevent their staff from talking to anyone about it. They have made staff re-sign a confidentiality statement." The South Africans staff stayed in Warwick from May 5 until June 9. A UK team then flew down to Johannesburg to get the new systems up and running on June 13.
  • Courtesy of Yahoo! Finance, IBM Insider Transactions. Included in the list is an option exercise by CEO Samuel Palmisano of 193,634 shares at $22.735 to $31.6725 per share.
  • CFO.com: Visteon to Slash Retiree Benefits. The embattled auto-parts maker warned employees that it will cut back on post-retirement health coverage and life insurance benefits for as many as 6,700 white-collar workers. By Stephen Taub. Excerpts: Visteon Corp. is the latest among a growing number of companies, especially in the auto industry, to scale back benefits that had been promised to retirees. The embattled auto-parts maker — once a unit of Ford Motor Co. — warned employees that it will cut back on post-retirement health coverage and life insurance benefits for as many as 6,700 white-collar workers, reported the Detroit News. Salaried workers who retire on or after June 1, 2007, will no longer receive company-subsidized health insurance, according to the report. The News also said that as many as 4,300 employees, most of whom are under 45, will be required to pay the full health-care premium after they retire. Individuals who are closer to retirement will not be hit as hard since they will receive credits to defray their health-care costs.
  • Motley Fool: Checking Out IBM's Options. By Tim Beyers. Excerpts: Like most of us at Fool HQ, I strive to invest in companies that boast high-quality management that won't point the finger elsewhere when problems arise. For the most part, I had considered the folks at IBM among this class. Until yesterday. Big Blue is the subject of an informal investigation by the Securities and Exchange Commission over the company's stock options-expensing practices. The SEC wants to know whether the company's rhetoric about options expensing before its first-quarter 2005 earnings report accurately represented underlying circumstances, in relation to its earnings shortfall. It's important to note that IBM isn't under investigation for violating securities laws. But that doesn't mean this isn't a serious inquiry. To the contrary, IBM may have dramatically misled investors. Follow along, please. [...]
    t's clear to me that IBM did nothing wrong according to the letter of the law. But that's not the point. It was at best ethically ambiguous for Big Blue to try to pin disappointing results on options expensing when the truth was that the company had a bad quarter. A corporate titan such as IBM should know that investors understand that bad quarters happen. It needn't have played this game.
    But what's done is done. Regardless of the outcome of the investigation, one thing is clear: Management was more interested in spinning you than winning you over on the merits (or lack thereof) of the last quarter. Is that the kind of people with whom you want to invest your money? Not me, thanks.
  • AARP Bulletin: Pension Roulette. Millions of Americans are losing promised benefits. How secure is your future? By Tim Gray. Excerpts: Many experts maintain the PBGC is sound. “We live in a panic-induced society, and just because a pension is underfunded doesn’t mean you’ll lose it all. The PBGC is facing a long-term financial challenge, but there is no danger that it will run out of money,” says Karen Friedman, policy director for the Pension Rights Center, a consumer advocacy group in Washington. “It’s a matter of trying to find a rational solution to the problem.” [...]
    Of all workers, experts say, those most likely to feel the effects of the pension system’s upheavals are boomers in their 50s—those who are not old enough to have earned a large, protected pension benefit, but not young enough to build a new nest egg. Those who are already retired are usually safer. “Historically, 90 percent of those who get a benefit from the PBGC get the full amount that they have earned,” says PBGC spokesman Jeffrey Speicher. But younger workers—even if they have a larger pension—typically get less. Payouts are capped at $46,000 annually for those who retire at 65; at 55 the cap is $20,526. [...]
    “What’s important to remember,” says Friedman of the Pension Rights Center, “is that even if you have a good pension plan now, employers reserve the right to change that plan at any time. But you also need to know that your pension is insured by the PBGC and that most people wind up getting most of their benefits.” But not all. Connie Baker and her fellow flight attendants expect big cuts in their benefits once the PBGC settles their claims. “We trusted the company we worked for,” Baker says. “I used to look at the world through rose-colored glasses, thinking that things would be fair. Now I feel I have to take those glasses off.”
  • Motley Fool: Stupid CEO Tricks. If your company is too busy making its CEO rich to make you rich, then it might be time to find a better company. By Rich Smith. Excerpts: But listen up. We're investors. We're not here to watch TV. And telegenic or not, the numbers from the Kozlowski trial tell us something pretty darned important: Our CEOs are robbing us blind.
    Oh, you mean that $25 million! Take, for instance, this little bit of trivia: When the fabled Tyco ex-CEO received his W-2 form for tax year 1999, he failed to notice that a $25 million "bonus" he received had somehow not been reported to the IRS. Stop. Read that again. Now ignore the manifest silliness of Kozlowski's assertion for a moment, and focus on the fact that the guy made $25 million. Then understand that whether he noticed it or not, that $25 million was just part of his salary for the year. Aside from the bonus, Kozlowski's 1999 tax return reported $21 million in other compensation. That's $46 million in one year -- nice work if you can get it, eh? But as it turns out, 1999 was actually a lean year. Kozlowski's total compensation in 2000 rang in at $80 million. Executive PayWatch (an arm of the AFL-CIO labor union) puts his 2001 salary, bonus, stock rights, and other benefits at more than $62 million.
    In fiscal 2003 (the most recent for which I have statistics available), the average CEO of an S&P 500 company raked in nearly $9 million in total compensation, including cash, benefits, and stock options. Even if you take out the stock options and other benefits, these guys are paying themselves cash compensation of more than $3.5 million per year. $9,590 per day. $400 an hour. (Assuming you believe them when they say they're working 24/7 "to maximize shareholder value.")
  • New York Times: Cutting the Losses From Outsourcing. By William J. Holstein. Excerpts: Outsourcing will inevitably eliminate many more American jobs, says Ron Hira, assistant professor of public policy at the Rochester Institute of Technology. It's time for the federal government to take action to limit the damage, says Professor Hira, co-author with Anil Hira of "Outsourcing America: What's Behind Our National Crisis and How We Can Reclaim American Jobs" (American Management Association, $22). Here are excerpts from a conversation. [...]
    Q. You suggest that in some ways the government actually encourages the outsourcing of jobs. How?
    A. One policy that was part of the presidential campaign last year was about tax deferrals that companies got for expanding offshore operations. Companies are able to defer their taxes on profits that are earned offshore as long as they don't repatriate those profits. What Senator John Kerry was proposing, and companies have been lobbying for, was to get a moratorium, or a holiday, for one year to bring those profits back in. Kerry wanted that as a quid pro quo for eliminating the policy. There was $600 billion involved, according to J. P. Morgan. Companies not only got the moratorium but they also got the deferral back in. So the perverse incentive is already back in place. In a few years, they'll say: "We have another $500 billion overseas. Why don't you give us a tax break for a year?" This game will go on.
    Q. How else does the government encourage outsourcing?
    A. You've got programs like the H-1B visa. The intent of the program is, when you can't find American workers, you bring in highly skilled foreign workers who work on temporary visas. They can stay up to six years. The way it's been used traditionally is as a bridge to immigration. You capture the best and the brightest, and they become permanent residents. Unfortunately, some businesses have started using this in a different way. They're using it as a purely temporary means to bring in rank-and-file employees who will work for less money. They're not even bothering looking for American workers. This is pretty rampant in the I.T. sector in particular. Those workers then gain experience in the U.S. on the latest technologies, interfacing with customers, and then they are able to take that back to their home country.
    Q. How can this situation be corrected?
    A. The main thing is to ensure that American companies are looking for American workers first. That's the way Congress believes the program works, but more and more it doesn't.
  • New York Times: Do Tax Cuts for the Wealthy Stimulate Employment? By Robert H. Frank. Excerpts: The centerpiece of the Bush administration's economic policy has been large federal income tax cuts aimed mainly at top earners. These tax cuts account for much of the $2 trillion increase in the national debt projected to occur during the Bush presidency. They prompted a large group of Nobel laureates in economics to issue a statement last year condemning the administration's "reckless and extreme course that endangers the long-term economic health of our nation." The question of whether to make the tax cuts permanent is still on the Congressional agenda. So it is an opportune moment to examine the president's argument in support of them.
    Mr. Bush never pretended that the tax cuts were needed to make life more comfortable for the well to do. After all, with the bulk of all pretax income gains having gone to top earners in recent years, this group has prospered as never before. Rather, the president portrayed his tax cuts as the linchpin of his economic stimulus package. He argued that because most new jobs are created by small businesses, tax cuts to the owners of those businesses would stimulate robust employment growth. His policy thus rests implicitly on the premise that if business owners could afford to hire additional workers, they would. But whether owners can afford to hire is not the issue. What matters is whether hiring will increase their profits. [...]
    Had the dollars required to finance the president's tax cuts been used in other ways, they would have made a real difference. Larger tax cuts for middle- and low-income families, for example, would have stimulated immediate new spending because the savings rates for most of these families are low. And their additional spending would have been largely for products made by domestic businesses - which would have led, in turn, to increased employment.
    Grants to cash-starved state and local governments would have prevented layoffs of thousands of teachers and police officers. And many useful jobs could have been created directly. For instance, people could have been hired to scrutinize the cargo containers that currently enter the nation's ports uninspected.
    Economists from both sides of the political aisle argued from the beginning that tax cuts for the wealthy made no sense as a policy for stimulating new jobs. And experience has proved them right. Total private employment was actually lower in January 2005 than in January 2001, the first time since the Great Depression that employment has fallen during a president's term of office.
  • Denver Post: Shareholders feeling like pallbearers. By Al Lewis. Excerpts: AT&T's 120th and likely final annual shareholders meeting in Denver on Thursday was a funeral. Employee Lani Flesch, 54, took a few days off work and flew in from Libertyville, Ill., to say a few last words. She took the microphone and broke down in tears. Flesch, a project manager, wore colorful ribbons in her hair, a breezy brown dress, and stone and metal charms around her neck. She was once a schoolteacher but joined AT&T more than 22 years ago to earn more money. Had she stayed a teacher, she would have had a more certain future today. AT&T's repeated missteps cost her 65 percent of her pension, she said.
    David Dorman, AT&T's CEO, stood at a podium, stone-faced in a dark suit and red tie, as she cried. "I will not regain what I had until 2011 and I will be 60 years old," she whimpered. "Consider the pension, on the other hand, of Mr. Dorman with 4.5 years of service: At 65, he will make (more than a million annually). How can the board reward these decision-makers for these costly mistakes? "How can shareholders, employees and retirees be expected to share the pain when our executives take the gain?"
    Dorman offered Flesch no response. He simply moved to the next impassioned speaker and stood stone-faced once more. Flesch had endorsed a proposal that would require shareholder approval of supplemental executive retirement plans. The measure failed.
    And if you talk to Dorman - or AT&T's board - about the injustices of executive compensation, you might as well be talking to a cinderblock. Corporate fortunes go up and down. Technology changes, the corporate landscape changes, but what does not change is that these guys get paid. AT&T has miscalculated the future of telecommunications in almost every move it has made since the government broke up its monopoly in 1984. Its top leaders were handsomely rewarded for every idiotic move. Among the most lethal mistakes was overpaying for two Denver-based cable companies - TCI and MediaOne - and then pouring billions of dollars into upgrading them just as the economy collapsed.
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.

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.
  • Waiver Alert! Excerpts: Individuals should be advised that it is our understanding that all individuals laid off after 5/4/05 have been asked to sign a revised waiver. The revised waiver has a code "Ver. 05/04/05" on the signature page, does not contain a covenant not to sue, and is called "General Release." If they sign this waiver, they will be ineligible to participate in the collective action**; we believe that the current revised version of the waiver complies
    with the OWBPA. Whether they should sign the revised waiver depends on their individual economic circumstances. Although we believe that IBM continues to discriminate against older workers, because employees let go after 5/4 would have to forego significant severance pay, as a general rule we would advise them to elect to take the certain severance payment over the uncertain recovery which will probably be years away if there is a recovery in the
    collective action. [...]
    ** The collective action refers to the current litigation between IBM and the class known as Syverson v. IBM. Signing the new waiver and accepting the severance payment may also limit future claims that you may be entitled to. Examples: ADA, FMLA and enforcement of implied contracts. Please consult an attorney or use the lawyer benefits as a dues paying member of the Alliance@ IBM. Note: Syverson v. IBM is the *COLLECTIVE ACTION* lawsuit that people can join by contacting the Maine lawyers at out-of-blue.com and paying an initial fee of $500. Signing the waiver will not impact your ability to share in the settlement of Cooper v. IBM.
  • IBM Pension Lawsuit FAQ about Cooper v IBM, Updated 6-21-05. Excerpt: Below is a list of frequently asked questions about the class action lawsuit against IBM's 1995 and 1999 pension plans. The answers are my personal opinions, have not been verified with either IBM or plaintiffs’ counsel, and should not be construed as legal advice. On July 31, 2003, a federal district court judge ruled in favor of the employees in this case. IBM will appeal portions of the ruling. On September 28, 2004, IBM and the legal team on Cooper v IBM announced that an agreement had been negotiated that settles some of the claims and set the amount of damages that IBM will pay to the class if IBM's appeal of the district court's age discrimination rulings is unsuccessful. Click on any question to jump to the answer. Or scroll down and read them all.
  • Resource Action Tool Kit. Along with the CWA Job Survival Kit, here are some resources you can use when challenging or questioning a company policy, procedure or practice.
    • Reduction in Workforce actions (RIF)...
    • Escalations, Appeals and Skip level meetings...
    • Implied contracts vs. Employees at Will...
    • In General...
  • 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:
    • Comment 06/30/05: Word is that there is another lay off scheduled for 7/15. Also IBM trying hard to lease space to outside companies at 1133 in White Plains,NY. Starwood Corp has already leased space and moved about 150 people in. -Anonymous-
    • Comment 06/30/05: There have been layoffs at IBM's Yorktown Heights Research facility. Ten people in the speech group were laid off. I have been told that 32 people under T. C. Chen's management were laid off. There were additional layoffs at IBM's Hawthorne research building, although I don't know numbers. -Anonymous-
    • Comment 06/30/05: I've read just about every post on this comments page. I'm a former IBMer that was sold like a piece of cattle meat. At the time I thought that IBM employees needed to get together and form a union. I know that several others in my situation thought so too. But that was the problem. All we did was 'think'. Very few took any action. I suspect because they were so uninformed and scared. This happened a few years ago; and from what I've read here, it continues. It is a foolish way to react. Get off of you duffs and take some action. This union is really the best alternative that you have. Stop dreaming or hoping that IBM will not fire you. Stop thinking that good times are around the corner, if you just be patient and wait. Stop thinking that you'll figure out a way to be an individual that can bargain and reason with IBM management. WAKE UP! Join Alliance@IBM and get your co-workers to join. The more people you sign up, the more there are to go and sign up others. This is easier than you think. All it takes is a little courage, to stand up for yourself and your co-workers. Someone once said, "The difference between a hero and a coward is only 5 minutes longer..." Make your move! -Anonymous-
    • Comment 06/30/05: I have to sign the new "waiver" today, which I'm sure will be overturned in court as the old one was. My family needs the money. But I will still support all efforts to hang this discriminatory company in court. When we do go to court, it would be really interesting to find out how the "selection" was really made and how everyone else was told to ostracize those selected. Amazing...my in-basket, which on the average day prior to May 31, took in over 90 new notes a day, dropped to zilch overnight. Like many others experienced, I received no calls or notes or instant messages. Talk about feeling...er...I dunno...ostracized? Anyhow, would be interesting to know the mechanics. They sure have it down to a science by now. My manager's biggest concern over the last month has been how I'm to return my chintzy ThinkPad. Amazing again. -Anonymous-
    • Comment 06/30/05: East Fishkill IBM is no longer able to fool its employees there. I've never seen moral so bad anywhere beside IBM. Management trying to keep folks happy with pizza (of which there is a two slice maximum) in place of pay increase and real incentive. Year after year they tell us our raise is based on first quarter results not our accomplishments from the four quarters it should be. Everyone in East fishkill knows IBM is up to no good as usual and folks are not falling for it. If you can bail out of this titanic of a company, manufacturing in particular, do so because its just a matter of time and you want to control your own destiny as much as possible. A union is what IBM manufacturing needs but I doubt there will be much IBM manufacturing to organize in the near future. Good luck to the honest hard working folks IBM cares nothing about. -Anonymous-
    • Comment 06/30/05: For the employees still at IBM, a little hint. Every year when you do your IDP with your manager, you get to discuss your "next position" where you may be eligible to transfer to a new function after 24 months. Try to move upwards with a salary increase when you're ready, not sideways. Regardless of whether you move up or sideways, you will get a 3 or less PBC rating for being new on the job and still in training. If you move sideways several times, even if it is to meet a company need, and even if you perform very well, you will get PBC ratings that look like this: 3,2,3,2,3 etc so that IBM can lay you off based on your PBC ratings. This will happen when they tire of you and you're not close enough to your manager, even if you get team awards and big bonuses every year. Also watch out for team leads that take all the plum engagements or sales proposals that have the greatest chance of being won. They work on these knowing they'll be successful, and send you on projects that are doomed to fail or deals that they know you'll never win. Maybe being let go is a blessing after all! -Anonymous-
    • Comment 06/30/05: The week after I celebrated my 25 years service with IBM, I was laid off. I applied for many jobs within IBM since I was told 30 days ago, and proactively acted on a few jobs. Well, I did not land on any job. I see a lot of job openings, opened but withdrawn shortly afterwards. A lot of other jobs only take DOU or/and short term only. That did not fit the criteria I was given. Does anyone like to share the criteria on this lay off ? -Anonymous-
    • Comment 07/01/05: You know what I want back? All the hours/days/months/years I wasn't with my son because I was working. I too, got no support from management in the last 30 days. All they wanted us to do was go away. This was not a skills issue. no siree bob.
      -Anonymous-
    • Comment 07/01/05: I've had my last day with IBM, victim of one of the RA's. But what's most galling from a business standpoint is that last week, IGS announced a new round of cuts and whacked several of the people that I'd just turned over my responsibilities to! How this was planned and how the company expects to survive are a complete mystery to me. -Anonymous-
    • Comment 07/01/05: Okay, here's the latest...to win a contract with AT&T, IBM GS/BCS agreed to take on (as in "rebadge" or hire) 8 of their project managers. Is this what's it's coming down to? Trading people? I imagine these 8 people will be out of a job once the contract ends. and I imagine one of them took my job. I imagine they'll call this a "win" in GS WinWire. What a pathetic joke. This past november we were forced to hire someone from Brazil with little to no applicable technical skills. Okay, we said. This is a Brazilian IBMer who needs work. Not so. Okay then we said, this is a Brazilian IBM contractor who needs work? Not so. It was just somebody somebody knew. Imagine that. Is it me or is this lunacy? -Anonymous-
    • Comment 07/05/05: This might be a coincidence, but customer satisfaction with our blade servers, storage and support has been sliding, maybe due, to low employee morale. I've heard of several customers complaining all the way up to the executive level. IBM is also worried about the average age of its technical workforce and the need to immediately train replacements. But the left side of the brain doesn't know what the right side is doing. The layoffs continue! -Anonymous-
    • Comment 07/05/05: Did you know that IBM Ireland were given 5 weeks pay for each year of service to leave the company. Did you know that in some areas the voluntary redundancy was oversubscribed by 5:1? Did you know that in some areas the NSI of employees is 20%? -Anonymous-
    • Comment 07/05/05: Of the 60 folks who were cut from the CIO's office area of IBM, only _1_ was management grade. If this is really a response to the bad earnings last quarter, it's like trying to fix a basketball team by firing all the players but retaining all the coaches ... -Anonymous-
    • Comment 07/06/05: I know that 75 people were laid off from the IBM.com group.Some from White Plains and some from Raleigh. -Anonymous-
    • Comment 07/06/05: According to the RDRA package I received on 5/31, the Action was to affect 52 Research employees. (It is possible that more have been selected since.) Some areas were affected more than others. Science and Technology lost 17 out of 358, or about 5%. Almaden lost 10 out of 414. Software lost 17 out of 787. Systems lost 4; Technical Strategy and World Wide Operations - 3; Industry Solutions and Emerging Business - 1. Interestingly, in Science and Technology the average age of the "selected" was 54.706; of the "not selected" - 44.961. At the Almaden Research Center, the average age of the "selected" was 51.900; of the "not selected" - 42.512. In both cases, the difference is very substantial but just short of 10 years. One wonders whether there is some legal "presumption of innocence" associated with an average difference of less than 10 years between the ages of the laid-off and the ages of the employees left behind. One further wonders whether an age discrimination complaint is worth the paper and the stamps. -Anonymous-
    • Comment 07/06/05: Take Sam's annual salary and use it to feed the 700 families for a year, the ones who are struggling to pay their mortgage and put clothes on their children's backs because they got layed off after years of loyalty and dedication to IBM. Now that's putting things into correct perspective. -Anonymous-
    • Comment 07/07/05: Interesting fact from my fellow Canadians about the non-rehiring policy. That would explain why my offers to help have been unanswered. Leave it to IBM to put a client in jeopardy by laying off key resources and then refusing to allow them to continue to work with clients. -Anonymous-

"The test of our progress is not whether we add more to the abundance of those who have too much; it is whether we provide enough for those who have too little." — Franklin D. Roosevelt
This site is designed to allow IBM Employees to communicate and share methods of protecting their rights through the establishment of an IBM Employees Labor Union. Section 8(a)(1) of the National Labor Relations Act states it is a violation for Employers to spy on union gatherings, or pretend to spy. For the purpose of the National Labor Relations Act, notice is given that this site and all of its content, messages, communications, or other content is considered to be a union gathering.