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Tech Industry

HP asks workers to take more vacation

Looking to further cut costs, Hewlett-Packard asks its U.S. workers to take an additional eight days of vacation time by October or a pay cut of up to 10 percent.

Looking to further cut costs, Hewlett-Packard is asking its U.S. workers to take an additional eight days of vacation time by October or a pay cut of up to 10 percent.

HP had already asked workers to take six days of vacation time by Oct. 31. Under the new program, employees are asked to choose one of three options: take an additional eight paid vacation days by the end of October, take four additional vacation days and a 5 percent pay cut, or take a 10 percent pay cut. Employees can also choose to decline HP's request.

The plan, which was unveiled to workers Thursday, is part of a continued effort by HP to cut costs. The company is also eliminating a program that gives cars to its executives, tightening restrictions on cell phone use, and looking to be more aggressive in rooting out underperforming workers.

"There is sort of a renewed emphasis on making sure poor performers improve," said spokesman Dave Berman. "Poor performers who don't improve will be separated."

HP has touted its tradition of calling on employees to sacrifice during hard times, but the company is far from alone.

Chipmaker National Semiconductor asked workers to take five paid vacation days last quarter and is requesting employees take seven additional days in the current quarter, which ends in August, according to a company representative. Philips Semiconductor is requiring some workers at its Albuquerque, N.M., plant to take three weeks of vacation, paid or unpaid depending on how much vacation time the employee has accrued.

Dell Computer is requiring workers take off five days this quarter unpaid, a representative said. Workers can either take off one day a week for five weeks or take off an entire week.

A number of tech companies are asking or telling the bulk of their workers to take vacation time next week, including Sun Microsystems, chip gear giant Applied Materials, Adobe Systems and Xilinx.

"It's a tactic that goes back to (co-founders) Bill (Hewlett) and Dave (Packard)," HP spokeswoman Suzette Stephens said in April, when the first vacation request was made. "Everybody chips in and takes some measures, and that avoids more serious measures."

However, HP has had two rounds of job cuts as well. Early this year, the company cut 1,700 jobs and, in April, said it would ax 3,000 management positions.

HP has been looking to trim costs since at least late last year, when the company asked managers to delay salary increases, cut back on using temporary workers, and encourage employees to take vacation time.