Hewlett-Packard To Cut 14,500 Jobs

About 10 Percent Of Full-Time Staff To Go, Saving $1.9B Annually

(CBS/AP)  The 33 named complainants claim that under a questionnaire used to determine employee status by the courts and the Internal Revenue Service, they qualify as employees instead of as contractors.

A month earlier, Carly Fiorina's nearly six-year reign at Hewlett-Packard Co. ended as the company's board forced her out as chief executive, disappointed by her efforts to make the technology giant whose strongest business is printers more nimble and innovative.

Directors said they fired Fiorina, one of corporate America's highest ranking female executives, because she failed to execute a planned strategy of slashing costs and boosting revenue as quickly as directors had hoped.

"She made a lot of changes, including the merger with Compaq, layoffs, and reorganizations. A lot of employees resented her leadership," said Magid.

Fiorina had championed the 2002 acquisition of Compaq Computer Corp. in 2002 despite fierce resistance from shareholders and directors.

"These layoffs may be an indication that the controversial merger failed to result in the cost savings and efficiencies that the company had hoped for," said Magid

HP plans to record pretax restructuring charges of about $1.1 billion over the next six quarters, beginning in the fourth quarter of fiscal 2005. This excludes a previously announced $100 million restructuring charge to be taken in the third quarter.

HP also plans to dissolve its Customer Solutions Group, which is responsible for sales to small and medium-size businesses and public-sector customers. It will merge the sales function directly into three individual business units — Technology Solutions Group, Imaging and Printing Group and Personal Systems Group.

Following the dissolution of CSG, Michael J. Winkler, 60, will retire as executive vice president of CSG, after nearly 10 years at HP and Compaq.