This is functionality, the parameters are not removed, you will notice however if you look at the parameters tab in the test there is no longer a check by the parameter in the ''Used'' column this is how ALM indicates that there is still a paramter but it is no longer in use, this is expected behavior. In ALM 12.20 and newer there is a way to fix this however, you (Or someone with project admin access) will need to add an option in ALM customization in the project (the gear in the upper right hand corner of ALM) you need to enable the feature ''Enable automatic deletion of unused test/flow parameters when deleting a parameter at a lower level'' Once this option has been added, when you remove a component you will then need to select the checkbox in the popup window ''Delete unused promoted parameters from the test level'' then click ok. If you do this the parameters should be removed with the component. You may need to log out and log back in to get this feature working once you enable it in customization.