Lloyds TSB is cutting 450 IT jobs as it moves more positions to India.
The company is offshoring up to 250 permanent IT roles and 200 contractor positions, over a 12 month period from June. The permanent roles will be cut from the bank’s technology delivery division, which designs and develops software.
In a statement, it said: “Information technology is the backbone of our business, and by combining the diverse skills of our staff with those of other companies we can provide the best possible service to our customers.”
Lloyds TSB said it would offer all permanent staff who are affected a position elsewhere in the business, and was providing a £2,000 training bond to help them learn new skills.
Trade union Unite reacted angrily to the news, saying the Lloyds TSB decision represented “a lack of faith in the IT skills of their UK workforce”.
It said that employees in London and Manchester would be most affected, but other jobs would also go in Birmingham, Cardiff, Bristol, Haywards Heath, Gloucester, Andover, Edinburgh and Brighton.
The Lloyds TSB Union added that only 30 per cent of IT jobs in the technology delivery division would be left in the UK, following on from 210 jobs offshored last year to Tata Consultancy Services, Cognizant and Wipro.
But it added that other divisions could be affected, following on from an offshoring review carried out by Lloyds TSB last year. “Once this phase of offshoring is complete, the union expects other areas of the information technology division’s 2,400 UK-based workforce to follow suit, with many hundreds more IT jobs transferring to India as a consequence,” it said.
The biggest concentrations of Lloyds TSB IT staff are based in London, where 1,300 IT employees work, Wythenshawe which has 460 staff, Gloucester with 150, and Birmingham and Bristol which each have 120 IT employees.
”It’s not really surprising that Lloyds TSB is choosing to make redundancies within its IT operations given the current financial climate," said Paramjit Uppal, managing director at Qedis, the specialist management consultancy. "Indeed Lloyds TSB is certainly not the exception, with redundancies taking place across many industries as the credit crunch takes hold. Most banks and organisations in general are taking a long hard look at their IT capabilities and what steps they need to take to deliver competitive advantage versus commodity elements which could be sourced at a better price/value from other organisations.
“This cost-efficiency drive means that many of the traditional operational and technical roles within an IT organisation are now at risk from specialised outsourcers and offshore companies who have scale and focus and can offer these types of roles and activities at a lower cost," Uppal said.
Uppal warned, “For those people in IT operations and technical roles, the result is this - unless they skill up into areas that are more core to business (such as projects, architecture etc) and build leadership and management skills, they are at huge risk of being made redundant or being transferred to the outsourcer.”