Shares of Alphabet Inc. (NASDAQ: GOOGL) inches down in pre session on Thursday after big American IT businesses are suddenly discovering how hard it is to decrease personnel in Europe after announcing the greatest rounds of layoffs in their history.
In the US, businesses may announce large layoffs and fire hundreds or even thousands of employees in a few of months, and many have. As a result of labor rules that make it nearly hard to fire someone in some nations without first consulting employee interest organizations, huge layoffs by IT companies in Europe have halted.
As a result, thousands of computer workers are now in a state of uncertainty about how long-term discussions may have an impact on them.
People familiar with the situation who asked to remain anonymous because the details are private said that Google parent Alphabet Inc. is currently in discussions to reduce headcount in France through voluntary departures and is offering severance packages that it hopes are generous enough to convince employees to leave. One source with knowledge of the case said that Amazon offered senior managers there up to one year’s pay in exchange for their resignation and gave leaving staff time off so their shares could vest and be paid out as incentives.
According to a person familiar with the situation, Google is currently in talks with works councils, company-specific organizations where elected employee representatives negotiate with management about workforce issues, in both France and Germany, where labor laws are among the most stringent in the EU. Companies are obligated by law to negotiate with these councils before executing layoffs; this may be a drawn-out process that involves gathering data, engaging in talks, and considering all available options.
The insider said that due to these criteria, Google branches in Germany and France will be among the last places to experience job losses, if at all.
Google acknowledged the talks when contacted for comment and said that it has no plans to impose layoffs in Romania, Greece, or Austria.
In response to inquiries from Bloomberg, a Google representative stated, “We have been working carefully and individually through each nation where reductions are taking place to completely conform to local legal requirements, which vary by region, are difficult, and take time.”
A works council is negotiating with Google about how many employees—and what kinds—will be included in a voluntary collective exit plan in Paris, where Google employs about 1,600 people. A resolution may still be weeks away, according to those acquainted with the procedure, but in the meanwhile, business will go on as usual. One employee who asked to remain anonymous said that management made it clear that no one would be fired without their will.
In contrast, the UK’s lax labor laws will force an estimated 500 out of 8,000 Google employees to depart, according to Unite the Union spokesperson Matthew Waley. This is a 6% redundancy rate that is in line with the company’s worldwide goal. Confidential severance settlements will be determined through discussions with the works council, but the exact number of departures is not negotiable. On the ongoing negotiation process, Waley stated, “They are attempting to do the legal minimum.”