The Fairchild Way Of Firing.
John East, for 22 years the CEO of Actel, has both good and bad memories of Fairchild – his first employer after leaving university in 1968.
“Fairchild had been losing money,” recalls East, “as I look back on it, I imagine they might have been in a severe cash problem. One day Les Hogan (CEO) was interviewed by someone in the press.
‘What are you going to do to stem the losses?’
‘Not a problem. We’re going to reduce the headcount by a third. That will get our spending back in line.’
“That quote made the front page of the business section of the local newspaper.,” recalls East, “it probably felt good to the investors when they read it, but felt really bad to the people who worked there.’
“That was the beginning of some serious layoffs.” It also led to some serious criticism from Fairchild’s severest critic, Don Hoefler.
“I never met Don Hoefler,” reminisces East, “I think he had worked at Fairchild at one time and that there was bad blood when he left. He started writing a weekly industry newsletter. It was always very negative towards Fairchild. Needless to say the upper echelon at Fairchild were not enamoured of Hoefler. I heard several times that anyone caught in possession of one of Hoefler’s newsletters was subject to being fired but that might have been just a rumour.”
“Don Hoefler’s newsletter on ‘Layoffs Fairchild style’ described how Fairchild employs three unique tactics for implementing lay-offs. The paging system layoff, the locked door layoff, and the retroactive layoff.”
“It seemed like every other Friday somewhere in Fairchild there were layoffs,” recounts East, “everyone would go straight to the cafeteria Friday mornings. No one even bothered going to their desk. Everybody was scared to death. Everybody needed their job and knew that there was a very good chance that they would lose it in the next 15 minutes. Lots of gallows humor. Lots of camaraderie. Everybody loved everybody else. There are no atheists in foxholes.”
1. The Paging System Lay-off.
“There was a paging system in the building,” recalls East, “around 9am the paging system would crank up. ‘Bob Martin 2867′. Everybody knew what that meant. Bob Martin (who was a real person and a really delightful guy knew what it meant too. Bob would stand up and start shaking hands. After he said goodbye to everyone, he’d walk over to the phone and call 2867. 2867 was, of course, the HR department (Called “personnel” in those days). ‘Bob, this is Bill, can you drop by to see me?’ That would be the last that anyone would ever see or hear of Bob Martin.”
2. The Locked Door Layoff
“This one never made much sense to me,” says East, “but Hoefler swore it happened.
There was great fear in those days that company secrets would be stolen by people leaving the company (The Basic Data Handbook was the result of a lot of work that Fairchild rightly didn’t want to fall into the hands of the startups who were trying to eat Fairchild’s lunch).”
“According to Hoefler, if you were going to lay off someone in possession of a lot of key knowledge, then the way to do it was to have the facilities department change the lock on the victim’s door at night. Then, when the victim arrived in the morning and found his key wouldn’t open the door, he’d go see his boss who would then lay him off. That way he had no pre-warning and couldn’t sneak the key information out before the axe fell.”
3. The Retroactive Layoff
“This happened if you were unlucky enough to be selected for downsizing when you were out on vacation,” remembers East, “when the victim returned he was informed that he had been laid off and that there was good news and bad news:
‘The good news is we gave you two weeks of severance pay.’
‘The bad news is you were laid off two weeks ago’.”