22 June 2005

Honeywell's Plan for Census Adjustment by Globalization

Against the backdrop of information technology job erosion, one of Arizona's largest employers is about to embark on an escalation of replacing higher priced American employees with lower cost foreign employees. Rob Sanchez has the nitty gritty, and I encourage all to sign up to receive his excellent Job Destruction Newsletter that is keeping tally on the assault of the American high tech professional.
Honeywell executives have decided that revenue spent for engineering must go below 15% of their total expenditures. In order to cut costs they will "globalize" their engineering departments. This globalization process will focus on cutting the cost of labor by using the following methods:
  • Replacing current Honeywell workers with L-1 visa holders. These L-1 visa holders will come mostly from Russia, Czech Republic, and India.

  • Whenever possible all positions in engineering and its support functions will be outsourced to overseas locations.

  • All new IT jobs will be required to be outsourced offshore.

  • No external hiring will be allowed, and transfers of employees within Honeywell will be discouraged until the job terminations are complete.

  • Open job positions will be "backfilled with globalized engineers at a lower cost." Managers that refuse to go along with this process will be replaced with more cooperative ones.

  • American subcontractors are currently being eliminated and replaced with foreign companies.

Some more snippets:

The following factoids pertain specifically about Honeywell's Component Engineering in their Commercial Electronic Systems (CES) on Deer Valley Road in Phoenix, Arizona and Aerospace (AES). Similar tactics will be used at other Honeywell locations.

Honeywell CEO, Dave Cote, has ordered Roman Jamragowiecz, VP of Engineering, to globalize 25% of AES engineering. It is generally understood that Roman will lose his job if he doesn't meet this goal.

Honeywell understands that workers will be extremely angry when they see their jobs being filled by foreign workers. There is a fear that some employees may go postal when they are forced to train their replacements. On June 9th at the Deer Valley and Bell Road plant, managers were given training on workplace violence. Managers were counseled that they had to report all threats or "going postal" type comments. Extra security will be hired during the mass terminations.

Whenever possible work will be "co-sourced" to Indian companies such as Wipro, Keane, Caritor.

No Indians are to lose their jobs during the job cuts in the U.S.

Engineering layoffs will begin on July 1st and will be far more than 17% across the board cuts that were announced to the press. The undercount occurs because Honeywell isn't eliminating their globalized labor force - ONLY U.S. JOBS ARE AFFECTED, BUT ALL HONEYWELL WORKERS ARE COUNTED!

The 17% reduction is actually an undercount because each department must count its globalized staff in their headcount - the 17% number does not apply to the globalized staff, only U.S. staff!

As an example: If a department is composed of a total of 100 persons, with 60 in the United States and 40 in Bangalore, the total number of job losses in the U.S. is 17, not the 10 that would be calculated by the U.S. headcount (100*.17 = 17). None of workers in Bangalore will lose their jobs so the 17 will come out of the 60 U.S. employees.

American contractors have already been eliminated so only the employees left standing will be counted for the job cuts. Without counting the contractors this department in this example will axe 28% of its employees - almost twice as much as Honeywell admits through their press releases.

Layoffs will continue until engineering is less than 15% of the budget.

Honeywell at Deer Valley will be replacing American workers with Indian and Czechs. The foreign workers will be marched into the buildings on July 28th and 29th at the rate of 250-300 per day.

All U.S. citizens or Green card holders that quit will not be counted in the layoff statistics even though many of them will be forced to retire. There will also be an additional 2000 layoffs in aerospace that will not be counted in the total job loss statistics that will be released to the press.

Honeywell doesn't seem very concerned with diversity. They have already terminated employment of several African American women senior engineers. The Indians L-1s being brought in are 99% male and almost all of them are very young.

All employees that question the hiring of Indian L-1s are subject to bad performance reviews, and of course any black mark on their records could be used as a reason for dismissal.

There are approximately 31 Component Engineers in CES. The number will come down and will be backfilled with globalized engineers at a lower cost.

The Redmond, Washington location is considered short-handed. Despite the need for more engineers at Redmond, no engineers from other locations will be allowed to relocate to Redmond even if they are facing job termination.


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