CSC job cuts: NOA backtracks on comments, makes things worse (UPDATED)

By Chris Middleton
24 Apr 2012 View Comments
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The chair of the National Outsourcing Association (NOA), Martyn Hart, seems to have regretted wading into the dispute between IT services company CSC and the union Unite. He may now have further cause for regret.

Unite members last week protested against CSC's layoff programme, which totals some 1,100 or more UK-based jobs, announced in two tranches. (A Computing exclusive broke the story about the second wave of cuts on Friday 20 April.)

Further reading

Hart has clarified comments he made after the original round of cuts was announced, and which were widely interpreted as supporting the redundancies. 

Hart said this morning: "If a private company loses a major piece of work – or a client downsizes their requirements – during difficult economic times, then redundancies are unfortunately inevitable.

"This is an emotive topic, and of course Unite is going to defend the interests of its members. But if people are working on a specific contract, and that contract is greatly reduced [see below], then those jobs will be under threat."

That ought to have been enough. But Hart then added: "CSC has opted against voluntary redundancies, to empower it to keep hold of its most talented people – the highly skilled, in-demand people who would find it easiest to get a new job would be the most likely to volunteer."

Hart may come to wish that he had not involved himself a second time, as this view contradicts CSC's public statements about the layoffs.

On Friday, CSC told Computing that it hoped voluntary redundancies and redeployment would mitigate the need for compulsory cuts. "Where this is not possible, we will provide support to help ensure that anyone leaving the business does so in the best possible position."

The company has made a number of statements to this effect, and these presumably form the cornerstone of its negotiations with CSC's Unite members.

No one other than Hart has suggested that "the most talented people" would volunteer to get out of CSC.

Indeed, both Hart's original comments – which specifically concerned job cuts in the NHS Lorenzo programme – and his statement today would seem to imply that CSC is either in the throes of an economic crisis, has "lost a major piece of work", or that its ongoing relationship with the NHS is not as promising as CSC itself has claimed.

So if Hart is trying to position himself as a pragmatic friend to the services giant, then he is doing a remarkably poor job of it.

Hart's statement continued: "Unite talks in terms of maximising profitability for ‘American shareholders'. We do not believe this to be the case – as far as we understand the situation, these redundancies have more to do with surviving a recession (and reacting to the wishes of its client) than maximising dividends for shareholders."

This is interesting: "its client" must either be the NHS or the government, given that Hart's original comments were made after layoffs in the NHS programme. If so, Hart would seem to be offering some form of privileged insight into the NHS discussions.

More, one of the reasons for the breakdown of discussions between the NHS and CSC was a Lorenzo programme cut that CSC itself suggested: to 80 trusts from the original 220. This represented a cut of nearly two thirds of the programme, while CSC was offering to knock just one third off the original cost.

Hart's statement also completes a hat-trick of own goals (in a voluntary rematch) by contradicting Unite's O'Gallagher, who told Computing last week that CSC had informed him that the cuts were being made to increase its profitability.

In fairness to Hart, his statement does attempt to undo the damage that his original comments caused, and the offence to CSC workers facing the axe: “The National Outsourcing Association does not ‘support the job cuts,’ as suggested in some media outlets," said Hart. "It merely offered an explanation for CSC’s strategy.”

It may be an explanation that CSC is not too grateful for.

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