When the boss's daughter is not assured a job
Wednesday 09 April 1997
The daughter of the chairman of United Assurance, the merged life assurance group which last week announced 2,200 job losses, has become one of the first victims of the cutbacks.
Anthea Cudworth, daughter of John Cudworth and a former investment manager for Refuge Assurance, has lost her job following the decision of George Mack, the chief executive, to close her department down.
According to analysts, the departure of the chairman's daughter at the hands of his chief executive has caused some friction between the two men.
However, the company denied that Anthea's departure had caused any friction between Mr Cudworth and Mr Mack or that their relationship in any way boded ill for the future of the group.
The apparently strained relations between the two when United announced its results and cost cutting plans to analysts and the press last week was said to have been due to the late arrival of Mr Mack for the briefing.
When United Friendly and Refuge Assurance announced their merger last August it was anticipated that a quarter of the combined workforce would lose their jobs. In the event nearly a third of the workforce is being made redundant with the closure of more than half the group's branches.
One of the first casualties of the merger was the equities department of the Refuge, based in Gresham Street in the City where Anthea was employed as an investment manager. Her department has been closed and merged with the United Friendly's investment department in Southwark, south of the river, which itself is due to be relocated within the next 12 months.
Anthea lost her job in December and has now started a two year MBA course at the University of New South Wales, in Sydney.
United Assurance claims that the decision to close the Refuge's investment department was part of the original negotiations which led up to the merger agreement when it was announced last November.
Before the merger her father was chief executive of the Refuge group, with head offices in Wilmslow, Cheshire. The merged company denied any suggestion that her departure should be blamed on Mr Mack, who came from United Friendly.
The merged group is providing pounds 27m to cover the cost of the redundancies which are expected to average pounds 15,000 a head. Closing branches, mostly small local offices will cost an additional pounds 7m.
Most of the cuts will be implemented before the end of this year and the remainder by autumn, 1998 by which time the sales staff will be down to 4,200 from a peak of 6,400 in December, 1995. Branch numbers will be cut from just 279 to 116.
The group is also spending pounds 46m to integrate the computer systems of the two companies.
This will bring total merger costs to pounds 76m. However, it is forecasting annual savings of pounds 37m, including pounds 31m in reduced salaries.
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