Union leaders condemn HP plans to slash 1,100 UK jobs

Computer maker Hewlett-Packard (HP) is poised to axe more than 1,100 jobs in the UK as part of plans to lay off 27,000 employees around the world.
US firm HP received a Scottish Government grant in 2010. Picture: APUS firm HP received a Scottish Government grant in 2010. Picture: AP
US firm HP received a Scottish Government grant in 2010. Picture: AP

The US group, which last week reported better-than-expected revenues for the fourth quarter, said the impact would be felt around the country and it could not rule out job losses in Erskine, where it is in the process of filling 700-plus posts.

A spokeswoman said: “The proposed UK workforce management plan is part of HP’s global multi-year productivity initiative that was announced on 23 May 2012, and updated at its securities analysts meeting on 9 October 2013, to address current market and business pressures in support of HP’s turnaround.

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“HP remains committed to supporting the employability of its employees through a number of internal initiatives, including re-skilling, redeployment and support to obtain alternative employment as appropriate.”

The Unite trade union claimed the group, led by former Ebay boss Meg Whitman, gave its European managers little autonomy, “with the key decisions being made by the company’s American bosses”.

Unite national officer Ian Tonks said: “For the past five years, HP has been addicted to a culture of job cuts in the UK to such an extent that its highly skilled workforce has little faith in the way the company is being managed and will be.

“Unite will be doing everything possible to mitigate these job losses, which are a hammer blow to the UK’s IT sector and very distressing for employees in the run-up to Christmas.”

HP’s Erskine site, formerly a major manufacturing plant, is re-building its workforce around higher-end sales and service functions. It received a Scottish Government grant of £7 million in 2010 on condition that this would spawn 721 jobs over three years.

Whitman, who took the reins at HP in September 2011, is aiming to steer HP back on a path to growth by cutting jobs and focusing on areas with long-term potential, such as enterprise and remote computing services.

The group surprised analysts last week by reporting stronger-than-expected revenues of $29.1 billion (£17.8bn) for the fourth quarter thanks to growth in its enterprise group, which supplies servers, storage and networking products to large corporations.

Whitman said at the time that HP had ended its financial year “on a high note”, although analysts said the firm’s margins were coming under pressure as it tried to strike a balance between growth and profitability.

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The group is also facing legal action from investors who allege they were misled over its takeover of British software maker Autonomy. HP paid $10bn for the firm in 2011 and last year took an $8.8bn hit after claiming its value was inflated, although the company’s former management have vehemently denied any wrongdoing.

Mark Serwotka, head of the Public & Commercial Services trade union, said the job losses were “a body blow for local economies that need jobs and investment, not more cuts”.

He added: “Private companies with public sector contracts are taking their cues from the UK government’s damaging austerity policies, and putting profits before people’s livelihoods.”