updated 08:05 pm EDT, Mon September 10, 2012
Larger numbers from higher than expected early retirements
A filing with the Securities and Exchange Commission (SEC) shed some light on the scope of the HP force reductions being larger than originally expected. A combination of early retirements and layoffs has grown the total to 29,000 from a previous expected total of 27,000. The layoffs affect nearly every department, and account for about eight percent of the company's total workforce.
About 8,500 employees are opting for early retirement, which is available to any employee whose age and years with the company equal or exceed 65. HP is expecting to pay between five and 14 months pay, depending on time in service. The majority of the higher than expected job-losses are due to 2,000 more employees than expected opting to leave the company by way of retirement.
Besides just increasing the number of layoffs reported to the SEC, HP also increased the cost of its restructuring to $3.7 billion through 2014, mostly funded through the its US pension program. All but $400 million are related to the workforce reductions, early retirement payouts, and severance packages.
HP reported an $8.9 billion third quarter deficit in August. The loss was driven by poor sales and two "goodwill" write-offs of technical services provider EDS and PC manufacturer Compaq.