IBM India folk lose it before they gain it?
By Suneetha

The Indian workers of IBM are losing their benefits before they gain it says Karthik Shekhar, General Secretary, UNITES Professionals, the IT & ITES employees in India affiliated to UNI Global Union. Karthik opines that IBM employees in India are exploited. IBM’s net income for the 6 months ended June 30, 2009 was $5.4 billion compared with $5.1 billion in 2008.

While speaking to Techgoss, Karthik observed that the Indian counterpart of IT giant IBM makes a huge profit and it’s sad that the company refuses to share more of its gain in improving the working conditions of the employees. Karthik says that the employees on the most part have been ignorant of their rights and now when they are withdrawing the benefits one by one worldwide, the demand for anything new meets with a NO, the excuse? We no longer offer it worldwide. For e.g., the pension. They haven’t given a pension in India yet, but the IBM UK has already announced it is closing this benefit from next year.

Global Union UNI and its local partner UNITES have collated the following cost cutting measures taken by IBM Worldwide.
 
On July 7th, IBM UK announced its will to close all the final salary/defined benefit pension schemes from April 2010. According to UK Unite’s calculations it means that employees in their mid 50’s could lose up to £200’000 and even more for some. Due to these changes, it is estimated that some 700-1000 IBMers may leave the company by April 2010.
 
UNI launched a request for information on IBM pension scheme to its European affiliates to see whether other countries are being affected. So far the situation is as follows:

Austria
A lot of activities to cut expenses (e.g. reduction of meal allowances, fewer free parking lots for employees, no more support for home working costs related to lease lines) are happening in Austria.
 
Croatia
By Croatian law employers have the obligation to pay pension and health insurance to employees. But some benefits (company car, free use of mobile phone, paid recreation, systematic health review paid by the firm etc.) are being reduced or cut depending on negotiations with unions.
 
Belgium
IBM decided to remove two days of holidays from the extra-legal pool and reduced the company car benefit among others. Management also proposed that higher salaries are excluded from the salary indexation scheme while executives got a salary increase of 28%.
 
Denmark
In Denmark all IBM employees are covered by a portable pension scheme. The IBM plan, though, has been closed for new staff. In Denmark management has terminated an agreement for company paid internet for all employees as from September 1st 2009. However, there are groups of employees, who are covered by conditions for being available outside normal working hours and a few others, who still enjoy a company paid internet connection.
 
Germany
Running pension plans cannot be dropped thanks to German legislation, however, the closure will have effects on new hires. If IBM integrates employees following outsourcing deals or mergers and if those employees are covered by pension schemes, these schemes have to be maintained.
There is a new Total Compensation Concept which is based on statistics and calculations made by consultants. All major IBM competitors are working together to provide necessary data and to share the results. With the Total Compensation Concept, comparison of salaries is no longer based on base salaries only, but includes all cash payments, allowances and benefits. The intention seems to be to turn the various benefits into a cash equivalent and add it to the salary.

Netherlands
In NL the situation is similar to Germany, the pension scheme is still 'alive', but was changed significantly in 2006 (i.e. monthly contribution, limited early retirement options, reduced inflation mechanisms etc) in order to reduce expenses. Further cuts are for example that IBM home work ADSL lines have now to be paid by employees themselves and some direct support regarding laptop problems are being removed. More cost cutting along this line is under consideration.
 
Sweden
The pensions are regulated in collective bargaining agreement and thus can’t be changed unilaterally. However other benefits like the allowance for meal tickets are being removed. Also extra holidays given for “round” anniversaries are being scrapped.

Karthik told techgoss that while he has been nick named George Fernandez II for his efforts with IBM; the situation is not a winning one.
 
You could also watch this report on the 2009 changes in pension from the BBC on the youtube.