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Dell Asking Employees to Quit

A Dell spokesperson confirmed with Business Insider that the company is asking its employees to quit. Dell is calling this scheme a "voluntary separation program," and cannot be deemed as a layoff even though this program has layoff elements such as getting a chunk of money to use until the person finds another job, eligibility and so on.

"Dell has announced an optional, global and voluntary separation program for eligible team members who choose to leave the company in exchange for the offer of a separation package to support their transition," reads Dell's statement. "Would note that we've taken steps to optimize our business, streamline operations and improve efficiency over the past few years."

"And we [have] been consistent in saying that a critical element of our strategy has been, and always will be, about improving our cost structure and freeing up capital to make the investments in growth areas that matter to our customers," the statement adds.

There's speculation that Dell is feeling pressured to trim expenses, thus freeing up some needed cash. Founder Michael Dell and investment firm Silver Lake Partners completed a $24.9 billion buyout of the company back in October, making it a privately-held company. As part of the deal, the two borrowed $5.5 billion and another $2 billion from Microsoft. That said, it's no surprise that Dell is looking to free up some cash.

"Like any prudent company, we'll continue to evaluate and implement opportunities to enhance our operational effectiveness on an ongoing basis," the statement reads. "We won't have additional comment about the program, the number of Dell team members taking advantage of it or the cost involved."

The Dell spokesperson confirmed that this volunteer exit is not an early retirement plan, and is open to all global employees. Other companies have provided similar programs for long term employees soon eligible for retirement benefits, but this program has nothing to do with retirement.

  • vmem
    isn't this effectively a 'layoff' program for it's most talented employees since presumably only those who have confidence that they'll find another job will take the 'quit' package
    Reply
  • chibiwings
    Nostalgic.. Ü ex-dell exployee on their offshore site. it was a horrible experience... I work on the first half of the day then after my lunchbreak my site badcge stopped working then escorted by the security outside the office since we're no longer part of the company.. then sign the papers on HR. voala!
    Reply
  • Martell1977
    What they say: "its a voluntary separation program"

    What they mean: We are trying to lower our number of employees or swap some out for cheaper ones, but want to avoid paying unemployment/retirement. Thus, we need them to quit instead of being laid-off, fired or retired.

    I hope the severance package is worth it, golden handshakes don't seem to be very golden in these situations. Makes me wonder if this is to lower employee count or so they are replace high paid workers with lower paid ones, before they can retire.
    Reply
  • dextermat
    Sounds like the beginning of the end to me.
    Reply
  • hakesterman
    I would advise them to not agree to the program. You won't qualify for unemployment benefits and your lump sum total they told you will never happen. Uncle Sam will take a huge portion of it because it's a huge amount in one check. You will get osme of it back when you file your taxes, but it won't amount to much. Unless you got a for sure job secured, don't take it.
    Reply
  • Tuishimi
    @Chibiwings This type of employee management is not, unfortunately, rare. Many larger corporations treat employees that way. I've been through layoffs @ DEC and watched it happen... Great company to work for, terrible company to be fired from / layed off from.
    Reply
  • Johnpombrio
    Voluntary layoffs or early retirement are the worst for the company. Anyone who is very good at their job will quit while the ones that are pretty useless will stick around. That leaves you with the worst of your employees and the loss of the best.
    Reply
  • vaughn2k
    Had the same experience, since I started working 1994, from a processor company, then an optical transciever company until a power supply module company, where Dell is the number one customer... American companies here in the Philippines has really a way of 'releasing' people since 1997, where semiconductor an electronic corporations around the world started to slow down, and the rest are history... They will offer you voluntary resignations, then a separation package, then a severance package. If it sees there are still people need to quit, they will hold performance appraisals and salary increase, if still not, here comes the redundancy package... good luck! I like European companies better though...
    Reply
  • PhilFrisbie
    The beginning of the end was signaled when they took that money from Microsoft.
    Reply
  • f-14
    considering how many people hate their jobs and only use most jobs to lateral their way up the corporate ladders to better jobs, this sounds more like an enticement to those type of people.

    however as is typical after a buy out there is alot of consolidation and trimming of departments and product/services eliminated or reduced capacity in order to make back quickly the bulk or all of the purchase price and get back to profitable expansion as fast as possible. it's hellacious period and for those in the know that don't want to deal with all the restructuring and cut backs or increased work loads due to these, this is dells nice way of saying here take this especially you the guy with the R-R-R-Red stapler or take your chances with the TPS reports and the meetings with the BoB's!
    Office Space TPS Reports
    http://www.youtube.com/watch?v=Fy3rjQGc6lA

    Reply