Management Toolkit

AA rules out off-shoring move

Andy McCue silicon.com

Published: 19 Aug 2005 17:00 BST

The AA is to cut 100 jobs but has ruled out moving work overseas to India as part of the restructuring of its insurance call centres - aimed at saving the motoring organisation £12m per year.

The AA said it expects the cuts in management and administrative roles at two of its insurance call centres in Cardiff and Newcastle will be achieved through voluntary redundancy and normal staff turnover.

As part of the restructuring the AA, which is now owned by two private equity firms following a £1.75bn takeover last year, said it is also investing £8m in new technology and telephone systems to improve the performance of the call centres.

Kevin Sinclair, managing director of AA Insurance, said the company "seriously considered" moving the call centres to India because it would have delivered long-term savings of £24m.

But he claimed the service from the AA's UK call centre staff will increasingly differentiate the company from competitors that have chosen to outsource to India.

"We have considerable belief in the commitment shown by our UK insurance call centre teams. The decision to keep our call centres in the UK is good news for customers, who will enjoy improved service and we will invest in the vital technology our staff use when customers buy insurance from us or make claims," he said in a statement.

Full consultation with the AA's recognised union, the AA Democratic Union, has begun but the GMB has hit out at the cuts.

Paul Maloney, GMB National Secretary responsible for GMB members at the AA claims the publicly announced job losses are just the "thin end of the wedge".

In a statement, Maloney said: "Since the venture capitalists took over the AA last year there has been a series of job cuts announced piecemeal. This is not the end of the road."