Mitchell Bingemann | December 02, 2008
update ERICSSON Australia and New Zealand is to halve its contractor workforce and slash 100 permanent positions from across its business over the next six months, as part of a major cost saving exercise.
Ericsson said the job cuts, which would affect about 300 local employees, form part of a global cost-cutting program that was flagged in February in an effort to save $US588 million ($925 million).
"The reduction of 200 contractor positions falls in line with the completion of various projects while the reduction in permanent staff is to improve business efficiencies," an Ericsson Australia spokesman said.
The 100 permanent job cuts would affect staff at all levels including members of the executive management team, he said.
The first round of redundancies will occur in the middle of this month.
The Ericsson job cuts follow on the heels of a major workforce reduction by IBM, which plans to lose over 2500 workers across the Asia-Pacific, as the economy continues on a downward spiral.
Hutchison-owned Three Mobile also let go several contractors in the past week, but a spokeswoman said this was because the telco had finished work on a number of big projects.
Like Hutchison, Ericsson too denied its job cuts shared any relation to the global economic downturn.
"We can't speak on what the future holds for more cuts, but this is the global program as it stands today," the Ericsson spokesman said.
The company said all affected employees would receive full entitlements as well as outplacement, financial planning and counselling services support.
In Australia and New Zealand, Ericsson employs around 1660 permanent employees and about 405 contractors. Worldwide, it employs 77,350 people.