Insurance group Hibernian today announced it would cut 580 jobs in Ireland and move them to India under a restructuring plan.
The company, part of the Aviva group, said that over the next three years, it will "gradually move" part of its service and support functions to Aviva’s global services centre in Bangalore, India.
Scheduled to begin during early 2009, the restructuring will initially affect up to 80 jobs across Hibernian’s three centres in Dublin, Cork and Galway. Over the three-year period, a further 500 jobs are likely to move to Bangalore, the company said.
Hibernian chief executive Stuart Purdy
The insurer said the restructuring would entail minimising external recruitment, retraining, redeployment, normal staff turnover and other voluntary methods.
Hibernian said it was reorganising its business to increase operational efficiencies, reduce costs and support its continued growth.
According to the company, Dublin will remain Hibernian’s corporate headquarters, Galway the main customer contact and call centre for general insurance, with Cork specialising in technical underwriting and claims.
The overall number of employees in Cork and Galway is not expected to "change materially", Hibernian added.
Group Chief Executive, Stuart Purdy said, “In common with all businesses in today’s economic environment, it is imperative that Hibernian operates even more efficiently to provide best value and service to customers."
He added that the company has “ambitious” growth plans and that it remained “fully committed” to operations in Dublin, Cork and Galway.
In a statement, Mary Coughlan, Tánaiste and Minister for Enterprise, Trade and Employment, expressed regret at the announcement.
Ms Coughlan added, however, that the initial impact of the announcement is being minimised by the company. She also welcomed the future career opportunities that will arise in Hibernian Health.
The Tánaiste said Ireland continues to be an internationally recognised financial centre in the areas of international banking, funds and insurance.
Unite, the trade union representing most of the staff Hibernian Group, expressed anger at the news.
Speaking after meeting management today, Unite National Officer Jerry Shanahan said: "Today’s news is a hammer blow to staff who have dealt with two previous reorganisations of the company in 2000 and 2004, and who have been wholly accommodating in the development of significant operations outside Dublin, in Cork and Galway.
"We now face a greater challenge as the company has seriously narrowed the options. . . . The anger expressed after hearing the news could best be described as a red mist."
Fine Gael labour affairs spokesman Damien English TD described the loss of the jobs as "another nail in the coffin of the Government’s alleged economic competence".
He said: “580 job losses in a flagship company in the financial services sector is just the latest evidence that the housing sector collapse is spilling over into the rest of the economy and is a damning indictment of Fianna Fáil's economic record.
Willie Penrose, Labour Party spokesman on Enterprise and Employment, condemned what he said was Government inaction.
"The announcement that almost 600 jobs are to go in the Hibernian Insurance Group is a clear indication that the Govt is sleepwalking into a calamitous economic situation," he said.
"While we have become accustomed to hearing about redundancies in the manufacturing and construction sectors, job losses on this scale, in the financial services sector will set alarm bells ringing."
