Red Hat reduces its workforce by 4%

Red Hat, owned by IBM, is cutting 4 per cent of its worldwide staff, according to an email from CEO Matt Hicks to employees. The open-source software services provider stated that the layoffs would impact those in general and administrative positions.

According to Hicks, the layoffs will spare employees who are involved in direct customer sales or product development and stated that the measure is significant for the company to align with its future goals and compete in today’s market.

In the mail, Hicks, stated that the company had attempted to avoid the layoffs, but they had become necessary “‘to guarantee Red Hat’s ability to compete in a new environment.”’

He stated that the company will be eliminating the associate base of Red Hat over the next few months. Additionally, Hicks also talks about how the company plans to make and impact and align its next 10 years with its tremendous potential in open hybrid cloud in certain sectors inlcuding telecommunications and automotive.

Hicks also explained that the severance packages will vary depending on the country in which the employees are located and will be in line with local procedures. Employees in the United States will be entitled to receive various benefits, such as: above-average severance pay; medical coverage for a period of three to six months based on their length of service. Additionally, they will be getting the 100 per cent bonus from the company’s Q1 targeted fund and 100 per cent of the prorated quarterly target from Q2 bonus, with six months of career transition services and extended access to the Employee Assistance Program (EAP). Similarly, benefits for employees outside of the United States will conform to local regulations and customs in each country.

Red Hat’s parent firm IBM, which acquired the company in 2019, announced in January that it would be laying off approximately 3,900 workers. The Red Hat layoffs will be less extensive, with the firm currently having 19,000 employees, 2,000 of whom work in Raleigh. One of the most significant technology companies in the Triangle, had not previously resorted to workforce reductions, unlike many of its competitors.