HP executives warned last month that the company was going to cut another 30,000 workers, mostly from its Enterprise Services group, and on Monday another layoff occurred, Business Insider has learned.
An HP spokesperson told us, “These changes are part of a companywide strategy to give HP the needed workforce to be a more nimble customer and partner-centric company.”
HP has been in the process of cutting 55,000 people from its payroll since 2012, so with the newly planned cuts, the total could reach 85,000.
HP Enterprise will continue the layoff next year, even after HP splits apart on November 1.
We just heard from an employee in Enterprise Services that despite the warnings, employees “are in shock” from the cuts on Monday.
Internally, people in one group are calling it “Bloody Monday” because some of their teams lost 30% of their workers, an employee in that group told us.
That doesn’t necessarily mean that HP cut a large number of people overall on Monday. Most of these teams were already small, this person told us.
But employees were surprised by some of the particular people that HP let go, this person told us. For instance, we understand that HP let go all of the personnel in one of its data centres and is requiring workers from other data centres to manage this site as well.
As painful as this is for workers, the cuts may be necessary for HP’s business. HP’s revenues have been shrinking for years and Whitman is revamping ES away from worker-heavy, low-margin businesses (like tech support) and into more profitable consulting services (like cloud computing, big data).
HP ES has been on the receiving end of layoffs stretching back to 2008, when HP created the ES group by acquiring EDS. It has been the main target of the ongoing layoffs under CEO Meg Whitman, too.
No jumping ship
As you might imagine, rumours within ES are also running wild. One really odd thing we heard was that some account representatives were asked to sign an agreement in which they promised not to work for HP again, even as a contractor.
We couldn’t confirm that rumour, but we do know after November 1, when the company splits apart, workers will not be allowed to jump from one company to the other for six months, HP has said.
The one exception to the non-poaching agreement is if the employee was terminated. In that case the other company is free to hire them. So this new severance agreement, if true, might relate to that.
We also understand that with 30,000 more people to go, HP will conduct more layoffs at HP ES between now and the end of the year, one person close to the company told us.
But the company intends complete calendar year 2015 layoffs by Thanksgiving, so workers won’t lose their jobs during the holiday season.