Australian Unity cuts contractors

Redundancies occur as projects finish

Contractors were the first to go in the global financial crisis.

Contractors were the first to go in the global financial crisis.

Insurance firm Australian Unity has canned more than 30 contractors and has moved to handle IT projects internally.

The company deals with healthcare, financial services and retirement living and serves 560,000 people across the country, including some 325,000 members. It has about 75 IT staff, employs more than 1300 people and has 20 aged care facilities in NSW and Victoria.

A spokesman said that about 35 contractors were made redundant after projects had completed.

“Our contractor workforce was in a ratio of 60-40 (staff-to-contractors)… now it is 90-10,” he said, adding that IT projects are being handled in-house.

“[The move] is about IT efficiency… contractors left after finishing projects.”

The company has improved its IT efficiency over the last 18 months, introducing ‘scrums’ into the daily routine to help get more from project management and software consolidation.

The process means the IT shop no longer wastes time shuffling emails, and has improved project satisfaction through continual review processes.

Many companies have terminated contractors since the global financial crisis, including BankWest which cut 50 IT contractors along with some internal staff in March last year.

And the Federal Government plans to cut 50 per cent of government IT contractors as part of its acceptance in full of the Gershon reviewrecommendations.

Finance Minister, Lindsay Tanner, said last year the contractor cut is a “sensible recommendation”.

A survey of 818 IT managers by recruitment firm Hudson in June last year found that as many as 24 per cent of IT managers plan to cut contractors and a March report by the CIO Executive Council found 58 per cent of the 122 organisations surveyed had cut contractors.

The CIO Executive Council is part of the IDG Communications group.

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