Lloyds IT contractors among 4,600 layoffs
Lloyds Banking Group will eliminate almost 1,000 contract IT roles in the UK to help reduce its technology workforce by 40% - equating to 4,000 IT job redundancies.
The taxpayer-backed bank said the cuts to its tech unit, mostly incoming for next July, were part of its integration with HBOS to build a single, group-wide IT system.
In the UK, the axe will fall most heavily on permanent staff, mainly at HBOS sites, with a total of 1,700 redundancies split between the LBG Operations and IT divisions.
But overall, it is temporary workers at Lloyds who will be hit the hardest, given 1,150 contract roles will be shed in the UK, and another 1,750 will close overseas.
A contractor at the group, where 4,008 of its 10,000 IT roles will disappear, said management's announcement at midday yesterday sounded worse than it really was.
LBG is "in a major integration programme due to end next year, hence the reduction of contractors...they will lose some legacy systems in 2011, hence the staff reductions.
"The rest of the staff that support legacy [work will follow.] It's a simple as that - such an exercise has been done before and will no doubt be done again in the future."
Although the contractor claimed to have been offered an extension, albeit before the announcement, Lloyds says it plans to cut its use of agency staff and contractors.
The commitment, aimed at limiting layoffs of employees, is the second of its kind from the banking sector in as many months, after a similar announcement by RBS.
But even on its own, Lloyds' decision to shed 40% of its IT workforce represents a "major blow to the IT sector", according to the Lloyds TSB Group Union (LTU).
"The IT jobs sector in the UK is going to be flooded with highly skilled professionals over the next 18 months", said LTU general secretary Steve Tatlow.
"[As] over 3,200 LBG staff and contractors begin to seek work outside of the bank, there can be little doubt that areas such as Edinburgh, Halifax, Leeds and Chester will be unable to easily absorb such large numbers".
Under the announcement, half of the group's 24 UK sites will shed full-time or contract roles by 2012, and a further 291 UK-based staff will be sent overseas. In total, 4,600 jobs will be removed.
Mr Tatlow blasted: "It is disgraceful that at a time when such considerable numbers of LBG IT staff and contractors are about to lose their jobs, the bank should nevertheless still be transferring the jobs of existing staff to India."