IBM calls for consultation committee, signals more redundancies
Employees in IBM’s UK Global Technology Services division could be facing redundancy as the firm looks to streamline some operations and part of its network of 60 datacentres around the world.
Last month, IBM (NYSE: IBM) asked its core technical staff in the infrastructure services and T&T delivery team to form an employee consultation committee ahead of a 45-day period of collective dialogue.
According to rules set out by Acas, the advisory, conciliation and arbitration service, consultation “involves taking account of as well as listening to the views of employees and must therefore take place before decisions are made”.
Despite the reassurance, the instruction from IBM impacts 1,248 employees, a cohort that is reported to include 126 people from transition and transformation; 353 from project services; 397 classified as "all other IS delivery”; and 372 working on Lloyds and Vodafone accounts.
IBM – which the Ethisphere Institute recently named “one of the world’s most ethical companies” – saw is full year revenues decline 3.1% to US$77.1 billion in 2019. However, in the same full year results total cloud revenue increased 11% to reach $21.2 billion and net cash from operating activities stood at $14.8 billion.
IBM’s Q4 2019 results saw revenue up 0.1% to $21.8 billion, with revenues from the newly acquired Red Hat up 24% (normalised for historical compatibility).
However, the firm has been exposed on the stock market as the global Covid-19 pandemic continued to halt life, business and economies around the world.
On 20 March, the firm’s share price was down 4.93% and, at the time of writing its pre-market price per share was down 4.05%. However, performance had been strong up to mid-February when the global Covid-19 crisis started to gain pace.
It isn’t the first time potential redundancies at IBM have made headlines. In 2016, the firm was the subject of a press expose, which reported that frequently cutting “redundant jobs” was now a central part of the business’s HR model.
Then in June 2019, the company confirmed it would reduce its global headcount by 1,700, with the majority of lay offs concentrated in the UK, Ireland, Germany, Austria and Switzerland.
Capacity reached out for a comment, but IBM is yet to respond.