IBM Lays Off Employees With Reduced Severance

The Big Blue is strong on its restructuring plan, continues to downsize employees.

Big Blue’s plan of “restructuring” is an open secret. On Wednesday, the tech corporation dismissed some of its workforce. Employees labeled the layoff as “massive”. The Armonk, North Castle firm has not yet disclosed the exact size of the layoff but it is clear that redundancies and severance are around the corner for the company.

Earlier, IBM had confirmed that it was consistently practicing the job cuts. The company subsequently showed the effects of the layoffs on the financials; including savings and costs. It has also stipulated that it has simultaneously been recruiting new employees too.

CEO Ginni Rometty, who envisions transitioning the company from hardware and software solutions to cloud computing and artificial intelligence, had told earlier that around 70,000 people were axed from their jobs last year. She further added that company compensated the number of works dismissed by hiring same amount of number.

The finding of the research efficiently carried out by Business Insider suggests that the $134 billion organization has in fact downsized more than 70,000 people. It reported that in 2015, it had a global employees count of 377,757 which makes the aforementioned workforce attrition rate to be 18%.

The downside of the recent layoff is that the world’s leading organization is only paying a one-month total severance pay without considering the seniority of the employees who have dedicated their services for the organization. This information was revealed via a Facebook page from Lee Conrad, named, “Watching IBM.” Conrad had been running a former IBM employee’s watchdog organization earlier, dubbed as, “Alliance at IBM.” Although he no longer serve for the alliance organization since last year, he does post relevant information about layoffs and other working conditions at IBM through social networking site sourced by IBM workers.  

In January 2016, employees were informed about the future layoff through an official document called, “About Your Benefits – Separation.” Mr. Conrad shared the document with Business Insider in which IBM told its employees that through Individual Separation Allowance Plan (ISAP), it will provide all kind of assistance to the regular employees on account of their termination to ensure a smooth transition.

The assistance was also forwarded to the employees whose position got vacant in account for performance issues. Furthermore, it bluntly said, "The separation allowance payment available under the Individual Separation Allowance Plan, regardless of the circumstance under which ISAP is offered, is one month of pay."

Earlier, the severance pay varied according to the number of years the employees have worked for the company. According to Conrad, the redundancy pay was tentatively up to 23 weeks. A source privy to the matter said that the company has been offering the laid off employees to look for a job within the company. One of such employees expressed that this arrangement is not much commendable as how can a terminated employee be sure that he would not come under the axe of dismissal again.

In order to clear their stance, a spokeswoman forwarded the following statement: "IBM is aggressively transforming its business to lead in a new era of cognitive and cloud computing. This includes remixing skills to meet client requirements. To this end, IBM hired more than 70,000 professionals in 2015, many in these key skills areas, and currently has more than 25,000 open positions."