IBM accused of 'ageism' over mass-layoffs

22 February 2022 Consultancy.uk 3 min. read
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Global professional services giant IBM is facing hundreds of lawsuits from employees who claim to have been forced out of the firm. The claims allege employees were pushed out of positions on grounds of ageism, and quotes internal human resource memos noting higher millennial headcounts among competing firms.

IBM has been struggling to pivot its global business model in recent years, after a string of poor results rocked the firm’s bottom line. In 2017, Big Blue was found to have failed to grow its top and bottom lines for 21 continuous quarters in Britain, for example – resulting in leadership changes, and repeated cycles of job cuts. This played out across the firm’s global workforce – with IBM offloading hundreds of thousands of workers over the following years.

Now, hundreds of former IBM employees are suing the firm on grounds of age discrimination. Newly released documents from one lawsuit in particular have made waves recently, alleging IBM wanted to "correct" its "seniority mix" by weeding out older workers it labelled "dinobabies."

IBM accused of 'ageism' over mass-layoffs

Filed in the New York Southern District Court, the case of Lohnn versus IBM has seen documents unsealed disclosing evidence gathered by the plaintiff, in which a person whose identity is redacted talks about a plan for how to oust older members of IBM's workforce; looking to stating his intent to make them “an extinct species” at the firm by “inviting the dinobabies… to leave".

The suit was filed by Denise Lohnn, the widow of a former Client Executive from Connecticut who died by suicide after his layoff from IBM. Jorgen Lohnn had committed 15 years of service to Big Blue, before his departure from the firm at the age of 57. Employees designated for layoffs were allowed to apply for open jobs within the company, but the lawsuit suggests that the company discouraged managers from rehiring them.

Reports in the global press have noted that IBM applied to have the documents remain off the public record, however, the judge disagreed with that request. Articles from technology news site the Register have since further detailed the allegations, with the journalistic platform also noting other evidence described in the document concerned “an IBM plan to ask older workers to relocate or leave, with the expectation staff would choose the latter.”

According to the Register, its reporters had also documented an remote office consolidation programme in 2017, which “made just such a relocate-or-leave offer.”

A second document released also quotes correspondence between a redacted person, and an HR team assumed to be from IBM. It notes that the firm’s Millennial population “trails competitors,” and that while Accenture “is 72% millennial we are at 42% with a wide range and many units falling well below that average.” The document also suggests avoiding “using downbanding of existing employees as a way to fill jobs”.

Similarities have been noted between Lohnn’s case, and hundreds of other separate allegations. Shannon Liss-Riordan, who represents the impacted employees told the New York Times the filings “reveal that top IBM executives were explicitly plotting with one another to oust older workers from IBM’s work force in order to make room for millennial employees.”

According to a court deposition from Alan Wild, former Vice President of Human Resources at IBM, the company fired as many as 100,000 ‘older employees’ in 2019. ProPublica has alleged that between 2013 and 2018, older employees accounted for 60% of job cuts.

Meanwhile, IBM is seeing its new strategy bear fruit. In the past two quarters, the firm booked strong financial results, as cloud and consulting revenues boom.