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UK Unite union calls halt to Arm redundancy plan

Written by Wed 30 Mar 2022

Unite, the largest labour union in the UK, has asked chip manufacturer Arm to pause their plan to lay off 1,000 employees. Taking a temporary break in the recently announced redundancy plan would give Unite the opportunity to review the financial state of the company and provide insight as to whether layoffs are actually necessary.

In a statement on the Unite website,  the union requested that Arm freeze terminations and provide Unite accountants full access to the company’s financial information, “following its decision to slash 15 percent of the workforce despite being a profitable and successful company.”

Matthew Whaley, regional officer for Unite, clarified the union’s position, saying, “It appears that bosses want to reduce costs by targeting workers’ jobs while piling extra work on those left behind. The company has already told workers to take an effective pay cut worth thousands. Unite is calling for a comprehensive and transparent consultation and a freeze on job cuts.”

Arm released its plan to cut 1,000 workers earlier this month. In an email to staff, Arm CEO Rene Haas said that the company needs to “be more disciplined about our costs and where we’re investing.”

“To stay competitive, we need to remove duplication of work now that we are one Arm; stop work that is no longer critical to our future success; and think about how we get work done.”

The 1,000 planned redundancies represent a 12-15% reduction in Arm’s global workforce. This decision was made shortly after a highly-publicized acquisition deal fell apart. Softbank had reached an agreement to sell Arm to U.S. chip firm Nvidia. The value of the deal fluctuated, as it was tied to Nvidia stock price, rising from $40B to $80B at the end of 2021.

However, international regulators and industry leaders voiced concerns with the merging of the two companies, and the deal fell apart. Softbank is reportedly setting a backup plan in motion involving an initial public offering for Arm investors, and was due a break-up fee from Nvidia of $1.25B.

It is unclear how Arm will react to the request from Unite. In a statement published by The Register, the company said, “If the proposals go ahead, we anticipate that around 12-15 percent of people in Arm would be affected globally. The proposals are subject to consultation processes according to local laws. These changes are designed to optimize Arm’s G&A, research and other non-engineering functions, ensuring we have the right balance of roles to support the size and scale of the business. The changes are designed specifically to ensure we can continue to deliver on our strategic plan and remain focused on engineering and product delivery.”

Written by Wed 30 Mar 2022


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