AOL Asking 2,500 Employees to Fall on Their Sword

AOL logoWhile I just read this over at All Things Digital I am still scratching my head (which means I am typing with just one hand, so if this reads slow you’ll know why). AOL tends to be in the news in the past year or so more about whether the business will survive and how will it look when it is pushed out of the Time Warner nest officially in December. Why today would be any different I don’t know but the news from AOL is how they are asking for 2,500, or one third of their work force, to volunteer for a layoff.

AOL, which has already told investors that it will spend up to $200 million firing a good chunk of its staff, has now told its employees. It is looking for “up to 2,500 volunteers,” CEO Tim Armstrong told his staff today. That’s a third of the company’s payroll.

The voluntary layoff program begins on December 4, a few days before the company spins off from Time Warner (TWX). If the company doesn’t get enough volunteers, it will axe people on its own.

Ok, so in this crappy job market you are asking someone to either volunteer to move on or just wait and see if they will be told to move on. What I didn’t see was what would make that kind of move better than rolling the dice and hoping that you don’t get axed? In other words, if there is any doubt in an AOL employee’s mind as to whether they would survive this what is the advantage of volunteering. Is there monetary incentive? I’m a little baffled. Of course, if you look at it from the business side this is the kind of news investors like to hear.

In a gesture of “I’m suffering too” Tim Armstrong is not taking his bonus in the neighborhood of $1.5 million due him this year. All of the cynics in the crowd can chime in on that one I am sure. I have no comment but here is Armstrong’s take.

“As a member of our team and the person who takes accountability for the results of the company, I am making the decision to forego my 2009 bonus. That decision is a personal one and is not a sign for the future payout of the overall bonus plan for employees.”

So what about AOL as an Internet business? What about what this will look like moving forward? With ICQ on the block and MapQuest as well what is AOL going to be offering the market place when it is asked to stand alone other than 2,500 more folks with AOL on their resume when looking for work?

It might be interesting to hear from the MP crowd as to what their view of AOL is in the Internet marketing space as we approach this new phase in the company’s history. Let’s hear it.