BT to cut 30,000 jobs in two years

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The Independent Online
BT IS TO shed up to 30,000 more jobs over the next two years after making 29,300 redundant in this summer's pounds 1.1bn severance programme.

The reductions will be spread evenly over the period to 1995, when BT will have a workforce of about 135,000 compared with 240,000 at the time of privatisation in 1984.

Peter Archer, director of employee relations, said yesterday that the pace of changing technology, extra competition and the effects of the recession would dictate the precise number who would leave but the total would be between 10,000 and 15,000 a year.

The company would not repeat its Release 92 scheme, an expensive exercise that offered severance to all employees.

Forthcoming severance schemes are likely to be much more closely fixed to those areas where particular reductions were required.

Mr Archer said the terms of Release 92 had been too generous and resulted in nearly a quarter of the workforce wanting to leave. 'The early leaver payment could have been toned down and it could have been less,' he said.

Workers were eligible for severance payments of up to three times their salary. The average package of benefits for those leaving cost BT about pounds 38,000, although a small number of senior managers are believed to have received pay-offs of more than pounds 200,000.

Incentive payments worth 25 per cent of salary to leave before the end of July encouraged a mass exodus on the last day of the month, when 19,500 people left in an orgy of leaving parties.

More than 16,000 people were rejected for severance and courses to maintain morale have been instituted in those areas, mainly the operator service and telephone customer contact jobs that were particularly oversubscribed.

BT indicated that it wanted to shed 20,500 jobs under Release 92 when the scheme was announced earlier this year at an estimated cost of pounds 1bn.

Mr Archer would not reveal a final price for the scheme but said that although more than 40 per cent more people were accepted for severance the total bill did not rise in proportion as the unit cost was lower than BT expected.

The largest number of redundancies (12,300) was among engineering and technical grades but 4,300 managers earning more than pounds 20,000, 5,600 operators, 4,400 clerical workers and 2,500 other staff also left.

BT tried to make the package of benefits attractive to all ages and 15,300 people under 45 took severance. Of older workers, 4,000 were aged 45-50 and 10,000 were 50-60. The company's standard retirement age is 60.

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