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Quantum Sells Division, Lays Off Employees, then Outsources Laid-Off Workers to Division’s Buyer

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Quantum Sells Division, Lays Off Employees, then Outsources Laid-Off Workers to Division's Buyer

You have to hand it to corporate America for its creative and often unorthodox approach to cost reductions – that is, unless you are an employee affected by one of these creative cost reductions. As we reported recently, Quantum Corporation has sold its data storage division to Jabil, a Malaysian company, as a cost savings measure. As part of this cost savings plan, Quantum recently let go 1,110 employees, about 1/3 of its work force, and has announced that it has entered into a labor outsourcing agreement with Jabil Circuit in Malaysia. Under the terms of the outsourcing deal, Jabil will rehire about 900 former Quantum employees who are already based in Malaysia, and Quantum will collect a tidy sum for providing Jabil with skilled and trained workers (who will now be independent contractors).

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