HP/EDS to cut 24,600 jobs

HP/EDS to cut 24,600 jobs

Summary: Technology giant Hewlett-Packard said overnight that it would chop about 24,600 jobs, or 7.5 per cent of its total workforce following its US$13.9 billion acquisition of Texan IT services firm Electronic Data Systems.

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Technology giant Hewlett-Packard said overnight that it would chop about 24,600 jobs, or 7.5 per cent of its total workforce following its US$13.9 billion acquisition of Texan IT services firm Electronic Data Systems.

In a statement, the company said the "restructuring program" would take place over the next three years, with the staff reduction to vary by country, "based on local legal requirements and consultation with work councils and employee representatives".

However HP also expected to replace roughly half of the positions over the same period, to create what it called a global workforce with the right blend of services delivery capabilities.

No mention was made of the fate of HP and EDS' Australian staff, although the company may need to deal with unions locally to reduce its headcount substantially, as EDS' local workforce is heavily unionised. Nearly half of the reductions will occur in the United States.

In general, HP said the firm wanted to better align the combined company's structure with the operating model it had used over recent years. "In addition to making changes to its global workforce to better serve its services customers, HP has identified synergies in corporate overhead functions, such as real estate, IT and procurement," the company said.

The restructuring program is expected to result in annual cost savings of about US$1.8 billion, with that amount taking into account some reinvestment. The company will take a charge of US$1.7 billion related to the program.

Topics: IT Employment, Hewlett-Packard

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4 comments
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  • Uh Oh

    Note: Dust of the CV b/cause there won't be much left in Australia.
    anonymous
  • EDS' local workforce is heavily unionised

    Ummm
    No its not - EDS refuses to talk to unions
    anonymous
  • Goodbye

    EDS has a terrible reputation for how it treats employees. Look for a position asap then if possible take whatever severance you can get from EDS. Usually this is the minimum amount that they can legally get away with. Have you read the employee blogs concerning EDS, they sound truly awful. Hard to believe a company could get away with treating its employees as EDS is reputed to have done. Awful.
    anonymous
  • Not only EDS, HP also excels in non-compliance

    HP has never told its employees in various countries of how many reductions are planned and what will be the severance.

    This is in violation of the US Securities & Exchange Commision guidelines which require US companies taking a restructuring charge to notify the employeres of the benefits payable to them in the event of a lay-off. This is a requirement not only in US but in each and every country the compnay operates or has employees.

    HP has not complied with this requirement and is now laying off employees at free will and giving them some nominal compensation.
    anonymous