Probe: How IBM ousts older staff, replaces them with young blood

Big Blue's five-year effort to weed out elders detailed after deep-dive investigation

Flick man firing employment

IBM for the past five years has been pushing older employees out of the company and replacing them with younger staffers in the US or moving the jobs overseas, it is claimed.

Reg readers may have had a sneaking suspicion this was the case. As we exclusively reported last year, about a third of Big Blue workers, some 130,000 people, are now in India and Bangladesh. And, in early 2017, the IT titan forced its staff to work from centralized offices, rather than from home, which is a handy way to prune older folks from the workforce. Grizzled IBMers are unlikely to be able to up sticks and move across the country to be near an office, compared to younger techies who have yet to settle down.

Today, to remove any lingering doubt from anyone's mind, ProPublica and Mother Jones published a joint report into IBM's hiring and firing practices, which appear to unfairly favor the young and snub the old, after gathering data from more than 1,100 ex-employees. Rather than appraise people on merit, managers instead judge underlings by their year of birth, it is claimed.

Allegations of age discrimination at IBM, to say nothing of other technology companies, have been around for years.

Since 2016, Lee Conrad, who runs the website Watching IBM and a more recent Facebook page, has been writing about claims of age discrimination through forced retirements and layoffs at IBM. Tech columnist Robert Cringely addressed the issue in 2016. In 2014, a jury in Connecticut awarded a former IBM employee, fired at 61, $1.5 million for age discrimination.

Age discrimination is, for the most part, illegal in the US under the Age Discrimination in Employment Act. It's nonetheless quite common because it can save companies in terms of salaries and benefits costs, because it's difficult to prove, and, as the report suggests, because companies take steps to conceal it and to keep claims out of the court system.

The ProPublica/Mother Jones investigation found that IBM:

  • Withheld information from workers that the law requires for assessing whether they've been subject to age bias and required them to sign away their right to go to court or form a group to challenge company practices.
  • Used techniques designed to target older workers for layoffs and firings, despite performance ratings, and sometimes used resulting savings to hire younger workers.
  • Made efforts to turn job cuts into retirements and to encourage resignations and firings in order to reduce layoff numbers high enough to trigger public disclosure requirements.
  • Advised those targeted for layoffs to apply for other IBM positions while simultaneously telling managers not to hire those people, even as it required them to train their replacements.
  • Told some older workers that their skills were no longer current yet subsequently rehired them as contract workers with diminished wages and benefits.

Over the past five years, Big Blue has axed over 20,000 American employees who were 40 years old or more, it is estimated, amounting to roughly 60 per cent of its US job cuts during that period.

If IBM has been shedding older workers as claimed, it appears not to have moved the age needle much. According to data biz Statista, IBM's workforce in 2016 had one of the highest median ages in the tech industry. The biz is in the middle of a long-running $4bn campaign to reinvent itself as a trendy cloud and mobile outfit.

Meanwhile, the US government is looking into whether it should change the Selective Service rules to expand the pool of technical talent that can be drafted to include people of any age or gender.

The Register asked IBM for comment, but we've not heard back. ®




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