Otherwise, people are going to stay a few more years.
12 replies (most recent on top)
The reason Ford settles the lawsuits that aren’t heading in their favor - is that the federal government by law cancels contracts with company who have been found guilty of discrimination. The company is not eligible for a government contract for years after being found guilty. This means no USPS vans etc. It also would severely impact government “loans” and other handouts.
As another post stats the actual settlement numbers are baked into the cost of doing layoff so Ford doesn’t’ care about that money.
@All
I agree at prima facie that it is difficult to sue for age discrimination and that large cuts in any short time period favor Ford. Ford most certainly cares about age discrimination based lawsuits, given they just paid A LOT in settlement monies at the beginning of the year. This doesn't even count the money they paid to their own legal counsel. Given it's still fairly recent, all of that evidence is probably still discoverable if plaintiffs can again start to show causation. In turn I think the courts would begin to ask Ford what they have done to change their age biased culture since all of this went down, although I don't believe Ford admitted to wrongdoing in the settlement. My guess is Ford would give an answer that amounts to "not much."
While big numbers favor Ford out of the gate, they also lend themselves to A LOT of documents that went around with age related detail and email information that will most assuredly contain commentary. Managers are going to fight tooth to nail to keep their lower level employees, and my guess is HR knuckles under. Following this, it wouldn't surprise me to see these next rounds executed with the intention of creating the most anxiety and secrecy at the lowest cost to Ford. Farley can say what he will about conducting these with "empathy and care," but we know this will not be the case. We as employees can point to late April where that was anything but reality. We'll need to see what evidence surfaces post cuts, and we might be surprised at what arises when a bunch of people at least start the conversation with a law firm.
@kce. Yes, the cost of lawsuits is baked in, but don't say management doesn't care about lawsuits. Why do you think they give severance? It is to keep the number of lawsuits within their model and out of the press. Why are voluntaries ever offered? It is because the people that they want to leave disproportionately fall under the age discrimination category. If they do not give a worthwhile separation, they will exceed the 1%. Especially when it is known the company is targeting older people's healthcare and pension costs. The older employees know it, and the lawyers do as well.
@iyc statistically less than one percent of those who receive involuntary separation package sue. The number crunchers know the statistics and factor in the lawsuit costs as part of resource separations. Ford leadership could care less about the lawsuits, it is already a line item in their plan.
Involuntary are better for company as they can pick who to cut. Post involuntary there is always an uptick in retirements. So win win for the c-suite
The company wants to get rid of healthcare and pension costs. Voluntary offers are the way to get people off the fence. Involuntary separations that accomplish the goal of getting rid of healthcare and pension costs will result in lawsuits.
@hwz+1hXHAiXu I'm with you on this.
They very well could offer a voluntary to avoid the legal challenges and conceivably pay less than they would for an invol. Remember invols get very messy for Ford and that whole class action age lawsuit was recently settled- could still use the evidence stemming from it. The more they flat out cut, the more people that potentially call Sam.
The big advantage to it is that they get an earlier count of the retirements and know EXACTLY how many are going to go early on if they plan it right. They can then figure out what makes more sense from an invol standpoint as well. If they don't do anything and just do invols before Nov 1 (cutoff date to apply for retirement), they run a huge risk of (way) overindexing +/-, given they won't know the vol number. It would make it MUCH more difficult for them to plan for that. Finally, it would help ease the administrative burden of all of those applications potentially coming in at once. Who in their right mind would tell them they're retiring at the end of the year in this environment??
Too many legal tails if they are aggressive with layoffs which could prompt a class action lawsuit. Can you imagine all the discovery emails and documents of how management picked the winners and losers. What would really get folks to move would be to propose changes to the pension plan starting Jan1. That would just suck for anybody left holding the bag,
Severance = Hush Money = No Lawsuits... If you task a bunch of LLs to clean house they might just step away too. Like Sc--w You Bill Ford and Jim Farley...you created this mess now clean it up.
SEVERENCE (not offers) will be up to 9 months depending on years of service. The bloodletting will start by the end of August. Enjoy the dog days of summer with the black cloud of "who's staying and who's going" hanging over your head.
A voluntary for knowledge transfer... I think not. Here's my POV for what it's worth... No voluntary package coming. Due to rising interest rates, anyone with a decent sized lump sum will retire by Nov 30, with or without a package, or face a 30% reduction in that lump sum next year. Beginning in 23CY, GRP pensions will convert to 401K at the reduced lump sum value, and then the involuntary firings will be brutal. Pension plan is currently fully funded at last year's interest rates. Company makes automatic 30% on anyone working past Nov 30. I hope I'm wrong.
The reason to have a (3 months?) voluntary offer is to make some attempt at knowledge transfer. There will be a large group of people clicking the button to retire in October and then retiring at the end of November. That leaves little time for succession planning and essentially no time for knowledge transfer. I’m surprised they haven’t released an offer already because all he-l is going to break lose come October. They are running themselves out of time. They have an opportunity to control this unusual situation at minimal cost so they should be doing that, IMO.
If the goal is to get older people to get out this would work. With the impending interest rate adjustment to the lump sum there will be a lot of people eager to take it. The flip side is that these people are already eager to pull the plug, so what is the incentive for Ford to give them more money? The cleanest way is for Ford to target everyone they want out and just pull the plug. I personally don't believe Ford will go down the voluntary path. Jimmy seems eager to get on with his view of Ford. And if you don't think the "list" is already in place you are naïve.
They will. Be patient.