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Story URL: http://www.silicon.com/research/specialreports/offshoring/0,3800003026,39121208,00.htm

Norwich Union cuts 700 IT jobs
And 250 contractors get binned

By Andy McCue

Published: Wednesday 09 June 2004

UK insurance firm Norwich Union is to axe 700 staff and 250 contractors from its Life unit in a cost-cutting restructure that will see some of the work outsourced offshore.

The restructure of the Life business services division involves IT, facilities management and business systems but staff hit hardest will be those working in software development and application support. The move is expected to be completed by the end of next year.

The cuts will see the business services division's workforce halved and a reduction in the number of contractors from 350 to 100. Norwich Union said most of the losses will be compulsory and staff at Norwich, York, Bristol, Stevenage and Croydon sites will be affected.

Gary Withers, CEO of Norwich Union's Life business, said in a statement: "Recent market conditions in the UK long-term savings market have been tough and we have to ensure that the company continues its drive for efficiency."

The company said the work will be transferred to IT outsourcing companies who have "global operations including locations in the UK, elsewhere in Europe, America and India".

The latest round of cuts is in addition to the 2,500 back-office administration, processing and IT roles that Norwich Union's parent company Aviva announced would be moved offshore to India last year. Although it said some of those would be accommodated by expansion, staff turnover and voluntary redundancy, around 500 jobs are expected to be lost.