HP imposes more salary cuts for EDS employees

HP imposes more salary cuts for EDS employees

Summary: HP said late Friday afternoon that it was temporarily cutting base salaries for EDS employees by an additional 10 percent beyond what was announced last month. On February 18, the company said it was cutting base pay across the board and making adjustments to benefit plans as part of a cost-cutting measure.

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HP said late Friday afternoon that it was temporarily cutting base salaries for EDS employees by an additional 10 percent beyond what was announced last month. On February 18, the company said it was cutting base pay across the board and making adjustments to benefit plans as part of a cost-cutting measure.

Below is the full text of today's memo to employees, obtained by ZDNet:

From: EDS Worldwide Marketing - Communications Sent: Friday, March 13, 2009 4:05 PM Subject: Additional, Temporary Compensation Adjustments for EDS U.S. & Puerto Rico Employees

To EDS Business Unit Employees in the United States and Puerto Rico:

Since becoming part of HP last year, we have accomplished a great deal and should be proud of what we have delivered together. Our service excellence remains high, and we have closed a number of significant deals. Our execution during the transition phase has been outstanding. As we move from the integration phase into the transformation phase, we know from experience with our own client projects this will be the most difficult part of our journey.

Our goal is to transform the business into a future state, which will grow faster than the market and enable us to take share from our competitors. We will then be able to deliver above-industry benchmark returns to our shareholders and price deals that win more business while providing flexibility to invest in innovation, delivering greater value to our clients.

The gap between where we are today and accomplishing our goals is widened by the current economic climate. As a result, we need to take temporary actions to get us through this difficult period. Our customers expect EDS to be a financially strong partner and, as employees, we expect a healthy company as well. With this in mind, we announced specific actions on March 9 to reduce our cost structure and enable the business to improve operating profit and grow as we enter fiscal year 2010.

Unfortunately, we need to take additional action. Specifically, we have decided to make a temporary, additional reduction in base salary affecting EDS business unit employees in the United States and Puerto Rico.

Base salaries for all United States and Puerto Rico employees in the EDS business unit will be temporarily reduced beyond those reductions previously announced by HP on February 18, as follows:

  • An additional, temporary reduction of 10 percent in base salary effective for April 2009
  • Base salary will not be reduced for employees below an annualized, full-time equivalent income of $40,000 by this additional, temporary action

In May 2009, base salary for United States and Puerto Rico employees in the EDS business unit will be reinstated to the levels of base salary effective on March 16. This includes reductions previously outlined in HP’s February 18 announcement. While we have no plans for an additional base salary reduction, we will continue to closely monitor the performance of our business and make further adjustments as required in the coming months.

We recognize these are tough actions, and you can be assured we made this decision after much thought and assessment. We ask for your support and understanding as we work through these very difficult times. We are confident we will strengthen our position in a consolidating market. We will be one of the industry’s strongest and safest pairs of hands, trusted by our clients to solve their technology challenges.

Sincerely,

The EDS Senior Leadership Team

Topics: Hewlett-Packard, CXO, IT Employment

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  • MUAHAHAHAHAHAHAHAH!!!!!

    HEEHEEHEEHEEHEEHEEHEEHEEHEEHEEEEEEEE! Yesssss!!!!!! Go for it, HP!
    Hopefully, you will put them out of business, just like you want to, after
    all two or three remaining competent people quit, and the other
    thousands have no place to go for answers and help. This is so rich! I
    love it! Please, please do more of this. It's great! Drive them before you,
    and hear the lamentations of their women. Way to go!
    thetwonkey
    • hostile work environment

      A little obvious you're an HP employee there thetwonkey. Oh, wait, all
      EDSers are HP employees, too. But it's just the arm of HP that's actually
      making money that's taking a pay cut. Hmmm . .. seems like that's just a
      tad backwards.

      HP's creating a hostile work environment to get EDSers to quit so they
      don't have to pay their severance. Plain and simple. HP would already be
      a non-entity if it wasn't for EDS.
      unbelievable01
  • RE: HP imposes more salary cuts for EDS employees

    1)Why? (there is no mention in that memo)
    2)What changed from 30 days ago?
    3)Who is the "The EDS Senior Leadership Team"?
    4)From who "From: EDS Worldwide Marketing - Communications" ??
    5)Why just EDS?
    6)Why just North America?
    7)Will fat cats make their numbers by doing this?
    8)Who set the goals that are not being met?
    9)Is this going to be SOP with salaries from here on out?
    10)Why no warning, what is the real intent here?

    As far as I am concerned, it is completely unacceptable to announce something such as this with no warning and no information.

    This is truly the end of EDS (and possibly HP).
    Krigare
    • RE: HP imposes more salary cuts for EDS employees

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  • RE: HP imposes more salary cuts for EDS employees

    EDS announced today they are cutting pay an
    additional 10% on top of the 5% announced
    earlier. It seems the company figures if it
    can?t get customers to pay Mark Hurd's ridiculous
    bonuses it can just milk the
    employees dry. I?m now making less than what I
    was making when I hired into EDS in 2001. At
    that time, the expectation was 45-48 hours of
    work with a weekend or two of work per month.
    I?m now working 70 hour weeks (as are the rest
    of my co-workers on the GM account). The the pay
    cuts are only being forced on US and Puerto
    Rico employees. Elsewhere, employees are
    protected by their countries? laws and won't
    have their pay cut unless they "volunteer". I guess
    this means HP employees around the globe aren't
    willing to give up their fair share to save jobs, so
    US
    employees are being forced to shoulder an
    unfair share (and the world calls us ugly Americans).
    Additionally, only
    EDS employees (not HP) are being targeted with
    this additional 10% cut. Apparently we EDS
    employees are second rate citizens at HP. There
    is no value in being an expendable human
    resource for a large corporation. Regardless
    of the hours we work, our salaries are fixed
    and there is always an excuse as to why raises
    or bonuses aren?t available. The way I figure
    it, if I?m being paid less than I was paid 8 years ago
    (for fewer hours back then), my productivity
    needs to decrease accordingly. Work more than 45
    hours a week...hah. I've noticed my hands have hurt
    from all the typing and hours I put in. I think it is
    time to file that workers compensation claim and have
    my developing carpel tunnel properly diagnosed. I'm
    afraid the pain may become too crippling to do other
    work. I hope HP has paid its insurance premiums. I
    can only imagine how many other fellow employees will
    be checking their physical health before those
    benefits disappear...
    HP Fodder
    • Who's fault is that?

      No body put a gun to your head and said you had to work 70 hours a week.

      Didn't you ever watch Office Space?
      Yax_to_the_Max
      • You missed the point "Yax"...

        The poster to which you replied was previously under the impression that "going the extra mile" was recognized and rewarded. It is now abundantly clear that is not the HP way.

        Apparently, you didn't pick up on the implication that the poster would be modifying their performance and behavior accordingly.
        cjsks
    • Get your facts straight

      Elsewhere, employees are
      protected by their countries? laws and won't
      have their pay cut unless they "volunteer". I guess
      this means HP employees around the globe aren't
      willing to give up their fair share to save jobs, so
      US
      employees are being forced to shoulder an
      unfair share (and the world calls us ugly Americans).

      Get your facts straight, the pay cut is not voluntary outside of the US, there maybe a few country's but let me assure you Canada isn't one of them. Also, how do you know others aren't voluntarily taking the pay cut?
      Anonymous100
  • really? I mean REALLY?

    This is the thanks we get for keeping HP profitable last quarter. When all other divisions fail by 20%, EDS is what keeps the company in the black. Reward? Oh, let's screw you even more. Thanks HP!
    notyouremailname
  • RE: HP imposes more salary cuts for EDS employees

    My pay is now just a variable number now. Whatever they feel like paying me each month. This month 5% cut, next month 15% cut, if things get worse will it be 30% soon. How am I supposed to budget for my home, daycare, car, retirement, college fund, if I never know what I am going to make? If I have to take $900 hit next month? what do I not pay? I need the house, the car, and if they want me to show up to work, the daycare? so apparently my kids college fund and my retirement is what I have to cut out. Time to go log onto the benefit center and make the 401K - 0%. I am pretty sure whatever money they are saving next month, they could EASILY get out of our CEO?s pay. You know they want everyone to unite, work together to get past these tough times, but our CEO made something like 40 million last year. I am betting he can live on that 40 million from last year, this year also. Why not take zero pay this year, and let the little people like me continue our children?s college funds, continue our retirements. It is just very shameful, and we are helpless to do anything about it. I have never felt so helpless. Please sir, may I have another.
    helpless00
  • RE: HP imposes more salary cuts for EDS employees

    EDS was the only saving grace in HP's earnings in the last quarter. Hurd is not interested in any losses no matter how little as he has a such a small bonus to beat this year. He considers EDS a fat cat that needs to be put on a diet regardless of the financial wealth and the assist EDS has provide to HP overall earnings in the past quarter. He needs to look in his own back yard. Typical take over activity, kill the newbees and pad the existing waste at an HP executive level. Hurd and his officers will rape EDS and ask for more until both companys are gone, and move on to another company. CEOs live in a different world and do not have to answer to direct customers or care about anyone but thier own bottom line. Can you say Narcissistic. This is the perfect econimic environment to feed the greed.

    Samualb
  • RE: HP imposes more salary cuts for EDS employees

    matthew_hartmann@...
  • Given the numbers they are talking about cutting, this is not good for EDS.

    As reported back in September of 2008, <a href=http://news.cnet.com/8301-1001_3-10041900-92.htm?tag=mncol;txt>HP to slash 24,600 jobs following EDS buy</a>. Just knowing these plans can't help the moral for those who are with EDS. From what I have heard (not being with either HP or EDS), EDS is one of the few profit centers for HP at this point.
    B.O.F.H.
  • RE: HP imposes more salary cuts for EDS employees

    test
    io-io
  • RE: HP imposes more salary cuts for EDS employees

    HP belief that EDS'rs are too overpaid higher than market rates. I believe this is just the 2nd step in their plan. 1st step was to permanently cut pay 5%; 2nd is cut base pay 10% for 1 month; 3rd - prior to the end of April, they will make the 10% cut permanent. This will get EDS pay with what HP thinks it should be. Also, it is just the perfect time to do it b/c they know they have employees over a barrel. I do agree with other posts that this is strictly fat cat corporate greed shining brightly. what a way to rally your eimployees to work harder.
    io-io
  • RE: HP imposes more salary cuts for EDS employees

    SAD and even more sad it the comment by thetwonkey. If this is an HP person no wonder they are failing. People and businesses only survive when they stand together. By singling ED out and then again only those in the US and Puerto Rico, sends a clear message. The problem with the whole economy is still the fat cats at the top, the sports athletes making ridiculous amounts to play baseball, the actors earning ridiculous fees for a tv show, all of these people could live the rest of their lives comfortably on what they made last year. One year salary alone for those in this bracket could feed countless other americans and keep them off the streets and out of trouble. Violence comes out of desperation, so we will next see a series of robberies, murders, suicides and abuse. I wonder what Obama would think of this, the fat cats tucking it to the little guy again.....Maybe we should swamp our congress men and women to instute laws as in the rest of the world to protect the worker from just this kind of thing. Then maybe, not a few would have to shoulder the burden for the many, and pay for the big bonuses that those making these cuts are sure to reap when the "Save" the company money......I for one will stay, but my work effort and substance will definitely be cut by 15% and maybe i will up it to 20% for good measure the following week!
    Deelee54
  • RE: HP imposes more salary cuts for EDS employees

    X
    MICHAEL1114
  • RE: HP imposes more salary cuts for EDS employees

    x
    MICHAEL1114
  • RE: HP imposes more salary cuts for EDS employees

    It is really a shame that this happens as families are struggling. The fat cats at the top make billions in stock, bonus and compensation. they just paid Rittenmeyer 45 billion to leave, jeff kelly a package to leave. guess hurd will make his numbers no matter what. of yeah he made 45 billion... wow... i'm sure the other executives are paid well too... but have to take it from the work class in the U.S. ~ Cananda, Germany, France and many other don't let this happen to their workers.... Good thing that we shipped so many jobs overseas.. protect those employees. Guess what, if they had to do this to make their numbers, next month expense goes back up and guess what they won't be able to do this. hp is ruining eds and doesn't really care. guess the long extra hours i've worked in the past will now stop. by the way eds carried hp last quarter but was clear in the video he made that eds was on his favorite. lower productity is on the way.
    MICHAEL1114
    • Bend Over - Here it comes again (BOHICA)

      The additional 10% cut in April for the only money making division within HP makes me wonder how Mark Hurd can look himself in the mirror. Although I wouldn?t be happy with any additional pay cuts, I would have at least been less pissed off if it was accross the board and include HP employees. ?EDS leadership? sending a late Friday Email unsigned is another kick in the ass. EDS?ers are HP?s most liquid assett. What a joke.

      Bend Me Over