Aviva staff attack lack of details as 950 jobs to go

AVIVA employees and trade unions have criticised the lack of information surrounding plans by the insurance company to axe up to 950 jobs in Ireland, despite reporting profits of over €1.5 billion for the first half of 2011.

The criticism came last night as members of the UNITE trade union, which represents a majority of Aviva staff, voted unanimously in favour of balloting on industrial action if the company attempts to push through any redundancies without the agreement of employees.

Aviva confirmed it will seek to cut its Irish workforce of almost 2,000 employees by half as part of a major restructuring of its European operations — resulting in the merger of its Irish and British divisions.

A total of 180 jobs will be lost among staff in Dublin employed by parent group Aviva Europe, while the insurer is also seeking 770 redundancies in Aviva Ireland. The company warned that up to 300 other jobs could be outsourced.

However, Aviva said no employees would be made redundant before next March, while the restructuring process could take up to two years.

Aviva also offered hope that 200 positions could be saved through establishing centres of excellence in Ireland to serve British customers.

A company spokesperson said the redundancies were being sought due to the challenging business climate, which has seen revenue from life insurance falling by 50% in recent years. Its general insurance business is down 25%.

However, Aviva’s last half-yearly reports showed the insurer increased life and pension sales in Ireland by 16% in the first half of 2011, while general and health insurance premiums rose by 5%. Overall, the group recorded a 5% increase in profit to €1.53bn.

“There is a pressing need to ensure the Irish cost base is at a market-leading level to secure the long-term success of the business,” the spokesperson said.

The spokesperson said Aviva remained committed to keeping open its offices in Dublin, Cork and Galway, although there is uncertainty about the future of some of the 26 branches in its current network.

Workers complained that managers who briefed staff about Aviva’s proposals yesterday were unable to provide details about which jobs were under threat and if redundancies would be voluntary or compulsory.

“Communication from Aviva has been appalling,” said UNITE organiser Brian Gallagher.

“The axe has fallen harder and sharper than the worst fears of staff. They are stunned and scared by what they have been told.”

Jobs Minister Richard Bruton said the Government could not stop firms like Aviva making commercial decisions to cut jobs but said the IDA was working with the company to see if there were any new opportunities for its Irish operations.