Posted on 07/16/2015 8:08:30 AM PDT by SeekAndFind
TIAA-CREF, a Fortune 100 financial-services organization that employs 12,500 workers in more than 100 local offices, announced a "special, one-time Voluntary Retirement Program" on Tuesday in a memo to its employees.
The company is offering this "opportunity" to people age 50 and older who have at least 10 years' tenure at the company, or at least five years' tenure for those 55 and up. Eligible employees who choose to participate will receive unspecified financial incentives.
We received a copy of the memo from an anonymous tip. TIAA-CREF confirmed the existence of the program and declined to comment further, emphasizing that it was a voluntary opportunity and that there was no larger plan to reduce staff.
Here is the memo, transcribed in full (bolding theirs):
(Excerpt) Read more at businessinsider.com ...
They will re-evaluate any future plans on layoffs and downsizing based on the acceptance rates of the offer they have out now.
This isn’t a good sign for the education retirement industry and those who have their money with them.
There is some irony in companies wanting to get rid of older workers. When we also hear from companies nowadays, how lacking the younger generation today is in their work habits, work ethic, productivity, etc.
While they will save on payroll and health costs by shedding older workers, their replacements will be the millenials who are lacking in the work ethic their older workers have.
Well folks, it’s been fun.
Better go spend some dollars on some non perishables and water.
Interesting. PFL
This tells me they’re worried about short term performance and what worries me more. Bottom line of expenses compared with the liabilities of what they have invested for teachers and have promised as returns and what their current expenses are. To me it indicates a real problem.
These programs are stupid. All the smart people who can easily get another job will take the money and leave. They’ll be left with the ‘others’ to keep their business running.
I have seen cases where the leavers joined consulting companies, and their first assignment was: right back where they used to work! Only they were getting $1000 a day plus expenses.
Dear Colleagues,
As we embark on the second half of our Vision 2020 strategy, we have significant opportunities to deliver on our promise to put the customer first in everything we do by becoming more efficient and effective. To drive continuous improvement, each of us needs to look for ways to simplify and improve processes and slow the rate of growth in expenses.
As part of these efforts, we are introducing a special, one-time Voluntary Retirement Program (VRP), which provides an opportunity for eligible employees to receive financial incentives if they participate. In recent years, some employees have expressed interest in such a program.
The VRP is generally available to employees in Tiers 2 — 12 who will be at least age 50 with 10 or more years of continuous service or at least age 55 with 5 or more years of continuous service by the end of 2015. Employees who are eligible will receive a communication later today with more information about the program. Those who want to participate must make their election by August 14, and the last day of work will be October 2.
This opportunity is completely voluntary. We value our employees and recognize the personal nature of the decision to participate in the VRP. We also recognize that some of you may think a program like this signals future layoffs. As always, we will continue to evaluate our business structure and workforce to ensure that we are meeting client needs as effectively as possible in a highly competitive, rapidly changing environment. Please be assured, however, that there is no enterprise-wide plan at this time to reduce staff.
Yes, I see your concern. Since TIAA CREF deals with teacher’s retirement plans, it’s likely these moves are driven by concern about how they will pay out the promised retirement benefits.
The maternity leave AND taking off work every other week because a kid has to go to the doctor, etc. ... it adds up.
And as you say, they do not have the same work ethic that older workers do.
I have NEVER once seen that young woman WITHOUT her cell phone in her hand.... NEVER
Yes. At the minimum it tells me that rosy picture of “trust us - it’s all good” isn’t so rosy.
I’ve already experienced where retirees from the USG who are Medicare eligible are going to be put off on a private exchange, the primary purpose of which is to stabilize long term health benefit commitments to retired employees. Initial costs will be comparable, but long term, the retiree will bear the brunt of increases, IMO.
I’d hate to be a teacher in TIA-CREFF that doesn’t have a guaranteed fixed return (they don’t do those anymore, BTW). What will come, I believe, is nothing more than a stock market gamble without QE. Not a good sign.
Early retirement used to be a standard way to RIF.
Maybe not. This is targeted at the over 50 population. That age group may have a harder time finding a new job if they didn't want to truly retire.
It's a double-edged sword. On the one hand, the company is shifting its costs from a salary burden to a pension burden. They may avoid pensions by making a one-time lump sum payment instead of lifetime annuity payments, in exchange for cutting their immediate operating costs. On the other hand, they take the short-term hit in productivity while they train up the next generation.
The risk is that they are trading proven loyal workers with unproven younger workers. On the other hand, it's inevitable that the 50+ workers will retire soon anyway, so they might as well get ahead of it and manage the transition on their terms, rather than be reactive as each worker chooses to retire on their own individual timelines.
-PJ
yes.. I agree. I’m in just this situation. I have been for the past 12 years. And on it goes. The communication level of these young people is squat.. They do not use full sentences. I’m talking large corporations here. They call in sick when they haven’t done a number #2 any particular day... oh the horror!
And I’m like, do you agree? and you’re all : yeah we agree.. and I’m all... wow... agrement!
I first heard this proposed about 35 years ago, during a downturn in my firm’s industry.
Nothing new, or to panic about.
I never understand why a business would want to get rid of its most experienced employees.
Yep, I hear you.
At my work, we had a meeting at which proper business communication was discussed. One of the things mentioned was that business letters and other correspondence such as email should be in formal writing, and not to use text message style abbreviations.
I took an offer like this from Bell.One years pay.I was planning on retiring a year down the road any who.
Financial firms can do so much more with digital these days and most realize some of the older folks are just coasting so offer them some $$ to hit the bricks.If they come back on board as a sub good for them.
I don’t think it has any refection on the strength of TIAA to pay out pensions.could be wrong
I never understand why a business would want to get rid of its most experienced employees.
It happens due to short term thinking. There is an immediate boost to the bottom line, as higher salaried workers are terminated. Also, employer health insurance costs are much higher for older workers in their 50s and 60s than for 20 something or 30 something age workers.
It can also happen if companies think you can’t teach an old dog new tricks, so to speak. In some cases you may have a 35 year old manager, for example, who due to lack of experience, doesn’t see the value of older more experienced workers, in spite of the additional dollar costs of employing such workers.
I’ve not experienced, but have heard such stories, about a 30 year old MBA who comes in and thinks he is smarter than everybody else, and thinks nothing of cleaning house.
Business communication and etiquette needs to be trained. It’s worth hiring a consultant/trainer for this, and I have done so in the past. My people loved it.
I continue to be amazed at the ongoing misuse of “reply all” in business email by people of all ages who ought to know better, for another example of a problem in this area.
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