Intel Corporation Tells Employees To Take Buyout Or Prepare For More Layoffs

Intel LogoBy The original uploader was VD64992 at English Wikipedia [Public domain], via Wikimedia Commons

Intel told employees on Monday that if the number of workers who accept buyouts do not meet its targets, then employees could face another round of layoffs. The chip maker also warned that the next time, the severance packages may not be as good as they are now, says Oregon Live.

Threatening employees with more layoffs

On Monday, the heads of Intel’s business groups sent a sternly-worded memo to employees offered buyouts, saying the company will resort to more layoffs if too many employees pass on the offer.

In a confidential email obtained by The Oregonian/OregonLive, the managers wrote, “If we don’t meet our targets, we will take follow-on actions, including involuntary headcount reductions. Those impacted by these follow-on actions may not receive packages comparable to the ones currently on offer.”

The employees who were invited to participate in Intel’s “Voluntary Separation Program” received this memo. The memo, it seems, did not go to those who were offered a separate early retirement package, the report says.

Intel plans to cut 12,000 jobs across the company or around 11% of its overall work force as it adjusts for the long-term decline in the PC industry. Last month, the world’s largest chip making company handed pink slips to 784 Oregon workers. Further, the chip maker is planning to slash hundreds more jobs through early retirement programs, buyouts and by laying off workers whose projects are cancelled.

Intel sees it as a best offer

Intel boasts in the memo that its buyouts are “market leading,” and compared to other buyouts offered by the chip maker in the past several years, they are the highest. The employees who take the buyout will get at least eight weeks of pay, and a few long-term employees will receive more than a year of pay. Also employees will get a portion of their bonus, and most of the workers will receive at least six months of health insurance.

But what really ratchets up the pressure is the unsubtle note near the end of the memo: “We will continue to manage lower performers each year.”

Employees eligible for a buyout can make their decision until June 2.

Before the layoffs began, the chip maker had around 19,500 employees in Oregon — more than any other business in the region. The company will reduce its Oregon workforce by more than 2,000 jobs by the middle of 2017 if it applies cutbacks evenly across the company.

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About the Author

Aman Jain
Aman is MBA (Finance) with an experience on both Marketing and Finance side. He has worked as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, reviewing tech gadgets, playing PC games and cricket. - Email him at [email protected]

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