Coles Group managing director John Durkan today confirmed the company's plans to slash 438 jobs from its Store Support Centre in Tooronga, Melbourne, and potentially redeploy 160 roles across the Coles national network.
The grocery retailer giant's Store Support Centre houses its IT department, along with finance and marketing. The job cuts include 378 permanent positions and 60 contractor roles from the Store Support Centre.
Australian Council of Trade Unions president Ged Kearney said that the council understands the jobs are all back office positions, from areas like IT.
Kearney said the news is a big disappointment and has called on Coles to commit to creating Australian jobs.
"It's come as a great surprise to us," she told ABC radio.
The ACTU fears the jobs could be sent offshore, but Durkan said that no jobs will go overseas.
The company said in a statement that the decision will "not result in any jobs being sent offshore".
The job cuts are part of a larger restructure of the Store Support Centre, which has been undertaken in order for the company to carry out the "next phase of its transformation," the company said.
According to Coles, the changes announced in the Store Support Centre are aimed at simplifying systems and processes, allowing for a more efficient and productive organisation to support its supermarkets.
Coles also said that the restructure will lead to a leaner Store Support Centre and enable increased investment in Coles' store network across Australia.
"The team members affected by this decision have made a significant contribution to Coles and we sincerely thank them for their hard work," said Durkan.
Meanwhile, Coles Group is moving to expand its national store footprint, investing AU$1.1 billion in 70 new stores across Australia, along with plans to expand its financial services offer.
"As part of Coles' expanding Financial Services offer, we plan to create more than 70 positions,” said Durkan.
In August, Coles' parent company Wesfarmersan 18.9 percent net profit increase during the 2014 financial year, partially driven by the strong growth Coles saw after it relaunched its website.
Coles Group had not provided comment to ZDNet at the time of writing.