Insurer axes 2,000 jobs and cuts redundancy pay

The group, which employs around 4,300 people in Yorkshire at sites in York, Leeds and Sheffield, also announced redundancy pay in the UK will be halved from four weeks per year of service to two from next year.

A York-based spokeswoman said she could not confirm how many jobs were at risk in the region but union Unite said it feared UK workers could be affected.

Aviva said the move was part of a programme to reduce costs across the business, including “substantial non-people related savings”.

Mark Wilson, the group’s chief executive officer, said: “I know this is difficult news for our employees but these changes are essential if we are to remain competitive.

“Aviva needs to become a more efficient and agile organisation to unlock its potential.

“We must take tough decisions on costs to provide our customers with great value products and ensure our future success.

“I am determined that Aviva gets through this phase of our business transformation as quickly as possible.”

The company, which has previously announced it planned to reduce costs by more than £400m, added in a statement: “Aviva has also reviewed its employment policies and practices to ensure they are effective and competitive in today’s market environment.

“As a result, Aviva has decided to introduce a revised redundancy policy for all employees on UK contracts. This will bring Aviva’s redundancy terms in line with market practice in the UK which will remain significantly above the statutory provisions.

“Importantly, the changes to redundancy terms will be implemented in two phases so those impacted in the next six months will still receive the current four weeks redundancy pay for each year of service. This is intended to minimise the impact on employees and follows consultations with employee forums and Unite.”

Unite said it feared UK jobs were under threat from yesterday’s announcement which would be on top of 800 redundancies announced last year.

National officer Dominic Hook said: “Once again finance staff are being forced to pay the price for boardroom failure. Aviva has also announced plans to slash redundancy pay, with longer serving staff losing more than a quarter of their entitlement.

“To cut redundancy pay so drastically when there is deep uncertainty over job security is a callous and disgraceful act.

“Since the departure of chief executive Andrew Moss less than 12 months ago, the UK workforce, which is the backbone of the company, has suffered job cuts, pay freezes and now faces an attack on redundancy terms, when the company is planning more cuts.

“Unite will give staff all the support possible to oppose any job losses in the UK and the cuts to redundancy terms.”