SAN JOSE, Calif. — Microchip executives have quelled most of the dissent from its acquisitions of Atmel and Micrel. However, small pockets of discontent remain on three continents.

A former Atmel design team in Dresden is suing Microchip for severance, claiming the company made a poor decision laying them off. A small group of former U.S. Atmel employees also is seeking severance they believe they were promised by Atmel. And in Shanghai, employees have protested layoffs.

Microchip offered half the severance Atmel promised, claiming Atmel miscommunicated an offer that expired before Microchip’s acquisition of the company earlier this year. Microchip declined to comment on the latest moves, given one is involved a legal suit.

A labor court in Dresden will hear the complaint of 39 former Atmel employees in a main hearing November. In the past, Atmel gave 1.2 month’s salary per year employed to people laid off in Germany, said a member of the Dresden team who asked to remain anonymous.

The court already held a conciliation hearing that ended without any concessions from Microchip. The judge asked Microchip to explain by September 9 why the team was terminated.

On April 18, two weeks after the Microchip acquisition of Atmel, the managing director of Atmel Automotive GmbH in Heilbronn visited the Dresden site to announce it would be closed. The closure went into effect May 4.

The Dresden employees claim Microchip didn’t take the time to evaluate the team’s role and accomplishments before making the decision. The site was opened in January 2002 initially to work on automotive designs. It grew to employ about 45 engineers working on wireless chips for Wi-Fi and Zigbee.

The Dresden site became a center of design expertise in IEEE 802.15.4 products, a Dresden engineer claimed. “Microchip’s 802.15.4 portfolio is not up to date, the Atmel products are more advanced and they conform to the latest standard revisions,” the Dresden engineer said.

The engineer noted a transcript of a May 4 conference callbetween Microchip CEO Steve Sanghi and financial analysts. “Atmel ran a very, very small wireless business out of seven different design centers, and we closed one of them which was in Germany in a very high-cost region,” Sanghi said in the call.

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