The world’s biggest computer maker is set to layoff nearly 27,000 employees by 2014. Such number of employees to be laid off actually comprises about eight percent (8%) of the said company’s total global workforce.
The layoff plan is said to be a part of a multi-year productivity initiative that was designed to simplify business processes, advance innovation and deliver better results not only for customers, but for employees and shareholders as well. Also, the layoff plan is expected to save the company up to $3.5 billion by the end of 2014.
The company said that the layoff plan will be executed basically through early retirement and will vary by country since each country has its own labor law and requirements. The company assured that the employment decision will be done based on the country’s labor law and in consultation with the company’s legal counsel and the employees’ legal representatives.
Hewlett-Packard (HP), which employs more than 300,000 people across the globe, has been struggling in the past few years.
The workforce cuts came to light following the thirty-one percent drop in profits in the second quarter of the year and the three percent decline in revenue from the previous year.
According to HP president and chief executive, Meg Whitman, although the company is more than aware of the adverse effect that the workforce cuts might bring to its workers, the company must be compelled to stick to its plan, since it is very crucial for the company’s long term growth.
Whitman added that a third of the lay off plan would be executed in the U.S.
Meanwhile, the world’s third biggest computer maker, Dell, is currently facing similar problem with HP. Recently, it was reported that the company’s quarterly profit dropped by thirty-three percent.
Apparently, the sequencing downturn of companies in the IT industry is like a domino effect in which one comes after the other. Recently, Yahoo, which was first to announce its workforce cuts, was now followed by HP and apparently, Dell is the next one to follow the trend.
Now, moving on with the work force cuts, a California wrongful termination lawyer is quite impressed with the HP’s effort of informing its workers that all terminated employees have the right to have their legal representatives beside them during the signing of release paper and separation agreement.