2,000 IT jobs in doubt in mail outsource deal

Union presses for consultation as Consignia plans to outsource IT jobs in £1.5bn contract.

Union presses for consultation as Consignia plans to outsource IT jobs in £1.5bn contract.

A major IT union is seeking urgent talks with mail operator Consignia about plans to sign a 10-year, £1.5bn IT outsourcing deal with a consortium led by Computer Sciences Corporation (CSC).

About 2,000 IT staff are expected to transfer to the third party. The deal, which is one of the largest of its kind in the UK, comes as UK IT professionals are concerned about their working rights during a transfer to another company, amid a period of growth in IT outsourcing.

The Communications Managers' Association (CMA), part of Amicus MSF, represents most of the Consignia workers affected and would rather have avoided outsourcing IT. "Our members have a clear preference to see a joint venture, because of concerns about job security, location and conditions of employment, particularly pensions," said Peter Skyte, national secretary designate of the CMA.

"We will need to have firm assurances on these, and will be seeking urgent discussions with Royal Mail and CSC," Skyte added.

The contract is expected to include professional services; desktop computer maintenance; and development of the company's server, mainframe and network infrastructure.

However, the scope of the deal falls well short of the business process outsourcing strategy recommended by consultancy KPMG last year after its review of Consignia's practices, which could have involved the transfer of postal delivery staff.

A consultant at Consignia claimed the company had shelved the idea of business process outsourcing to avoid a major confrontation with the unions, suggesting that IT workers have been singled out because they are seen as a soft target.

Consignia has entered into final contractual negotiations for outsourcing its business services division to CSC-led Prism Alliance, which includes BT and Xansa.

The move comes as IT professionals are becoming aware of the risks of transferring to an outsourcer or other company. Prudential has been threatened with legal action by Amicus MSF over an offshore outsourcing deal. The union claims that it failed to include staff in a proper consultation - a basic condition of Tupe regulations which give workers some legal protection when businesses are sold or functions outsourced.

Prudential has denied the claim and negotiations with the union are continuing. And in September a row over the interpretation of Tupe regulations left 60 IT staff in limbo after an outsourcing contract was cancelled between Lucent and Atos Origin. The staff had believed they would transfer to Compaq, the remaining Lucent supplier, but Compaq refused to accept them. That dispute is also not settled.

A spokesman for Consignia said key contract details were still being hammered out, adding that the company hoped for a "speedy" resolution to talks with unions.

"It is in everyone's interests that progress with negotiations continues apace," the spokesman said, adding that the deal is a key part of the company's three-year renewal plan to return it to profitability. "We're confident it will generate savings," he said.

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