IBM seeks over 300 voluntary lay-offs

 

IBM IS looking for 310 voluntary redundancies at its Dublin manufacturing facility and will move to compulsory severance if the target is not reached by the end of next month.

There are concerns that all manufacturing in Dublin will cease within the next year.

This week’s move to seek redundancies follows the transfer of manufacturing of high-end servers to Singapore. An additional 120 jobs were shed when the transfer to the Far East was first announced in February 2009. Initially, it had been thought IBM would seek 200 redundancies.

The company is offering staff three weeks’ salary per year of service in addition to the two weeks’ statutory payment. Staff at its Integrated Supply Chain operation have been given until the end of May to avail of the package.

If the target of 310 applicants is not reached, the company is expected to move to compulsory redundancies in early July.

The focus of activities at IBM’s Dublin Technology Campus, where about 3,000 staff are employed, has switched from manufacturing and fulfilment of hardware products to software and services in recent years.

Last month the company announced the creation of 200 jobs in Dublin with the establishment of a research centre to look at technologies to help manage cities.

The centre will employ researchers with post-graduate qualifications, and it is unlikely that any of the manufacturing workers will be able to transfer to it.

An IBM spokesman said the company was in negotiations with staff and as a result he could not comment on the likely number of jobs that would be lost. He said moving to compulsory redundancies if a voluntary scheme did not achieve its targets was standard practice.

Fine Gael enterprise spokesman Leo Varadkar, who is also a TD for the Dublin West constituency where IBM is located, called on the company to clarify the situation.

“They need to let people know how many jobs will be lost,” said Mr Varadkar. “I would also ask IBM if they will renew their assurance that there will be no compulsory redundancies.”

Although IBM said this week it would continue to build mid- and low-end servers in Dublin, concerns are increasing that the jobs involved will also move to the Far East in the next year.

It is understood that grants relating to manufacturing jobs received from IDA Ireland have now run out.

Singapore also offers an attractive corporation tax rate for new operations.

IBM is just the latest multinational to move manufacturing operations out of Ireland. Singapore is increasingly attracting the sort of high-end manufacturing that would have come to Ireland until our cost base increased significantly over the last decade.

IBM said this week that Singapore “provides a more strategic location for manufacturing operations, placing us closer to our growth markets and suppliers, and giving us greater operational efficiency and cost savings”.

Speaking at a briefing this week on marketing Ireland overseas, IDA Ireland chief executive Barry O’Leary identified Singapore as one of the locations his agency increasingly has to fight against to attract foreign direct investment.