When somebody says they hope T will offer them a buyout, isn't that the same thing as being laid off? Or is it something else that comes with better terms? I'm sorry if this is a stupid question, but I've been reading and hearing both terms and I can't figure out what's the difference.
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A layoff is when employees are released from employment...
A buyout is when earned, vested benefits are bought by the company, example is someone that has earned a very small deferred vested pension benefit (maybe only 10 or 15 years of service but still not 65 years old).
Instead of the company (or pension administrator) keeping you on the books for a number of years until you will then receive a very small monthly pension payment you will typically be offered an amount of money to "buy" your future benefits. Many people whose monthly pension payment amount will only be very small and will only be started at the age of 65 (for a lot of people that is 20 years or more) will opt to be "bought out" and done with it.
On the management side, easily more than 10 years ago, MVO was offered. That was the 'last buyout' if you want to call it that.
Managers were able to sign up for the enhanced package. It's been too many years, but MVO I believe just added more months of severance. There were no years added to service or age.
Management hasn't seen that in 10+ years.
What we have seen, is a voluntary interest in leaving. You sign up, if chosen you are included in the surplus pool. If incuded in the surplus pool, as I've understood, you can not try to get another job in the company, during the time you've been declared surplus and the last day on payroll. That's it.
Voluntary interest in leaving, as I understand it, has become even more rare.
Another term used is a match. In my building one of the floors got moved from texas to lubbuck. On my floor 2 people are leaving and were "matched" to save 2 jobs upstairs. They will receive $40000 incentive.
Buyouts used to mean you get a bit of extra incentive to leave aka more money than you would get if you got laid off. I have not seen that in many years either, sigh.
When people talk about "buyout" here, they are generally referring to the company offering some financial incentive to get volunteers to leave. Somebody explained it pretty well for bargained for below...if you're non bargained you may as well just forget it as those days are long over. Haven't even had an MVO for a couple years, and for the last couple of those it was bascially just volunteer to leave and we will give you your severance. Nothing else.
All the same. You’re off the books.
I’m not sure how it works for management, but for represented employees a buyout can either come during a layoff or upfront.
During a surplus, the company may say they are getting rid of 20 positions. If 20 people are willing to take the Voluntary Termination Pay or SIPP then no one will be forced off voluntarily. If they can’t get 20 takers then the lowest senior people will go off payroll. They offered it upfront a couple of years ago without a surplus in some areas, but this doesn’t happen that often.
I think management can get a Management Voluntary Offer (MVO), but I don’t know how often that happens.
It also means no guarantee of severance. If T is bought out, you would fall under whatever severance guidelines the new employer has or whatever was negotiated during the sale. This is why chasing severance pay is a fool’s errand. Find a new job now.
Another form of buyout is layoff with severance. That is a glorified layoff.
A buyout is basically 2 companies merging together. While that doesn't automatically mean layoffs will happen, it's not unusual for newly merged companies to consolidate and streamline their operations. In that case, layoffs are practically guaranteed.