Qantas to axe hundreds of tech jobs

Australian carrier is to outsource business processes to India

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By  Published  October 13, 2006

Australia’s biggest airline Qantas Airways is slashing up to 400 IT jobs in its home country and is transferring them to India because it claimed there was a local shortage in IT expertise.

The airline has said that it is cutting the jobs in Australia because the skills needed to upgrade its systems are no longer available and has shortlisted two Indian firms, Tata Consultancy Services and Satyam Computer Services, to take over the airline’s IT development, maintenance and support services.

“The providers involved in the tender process have the capabilities and the depth of expertise that we can no longer source in Australia,” Qantas chief information officer (CIO) John Willet said in a recent radio interview, reported Indian newspaper The Hindu.

Satyam, a leading global consulting and IT services company with a network across 55 countries, has already scored a contract with Qantas to provide payroll technology services to the firm. It is understood that Tata, a technology consulting, business process outsourcing and engineering services firm, will also work on that project.

“Qantas is finalising a review of its IT development, maintenance and support services,” the airline said in a statement.

The review is expected to be complete by the end of October and concerns staff working on internet bookings, frequent flier programmes, financial systems and operational logistics.

However, the airline firm has come up against stiff opposition over the job cuts from the Australian Services Union (ASU), which has dismissed claims by Qantas that it had to outsource the work to India because of a lack of skilled people in Australia.

“There are 400 people that are already performing this work, to say that they can’t find the capability beggars belief,” ASU national assistant secretary Linda White said, reported The Hindu.

The job cuts in the IT department are part of a wider reduction of staff at Qantas. The firm announced in May plans to axe 1,000 management and administration jobs by year-end and an extra 300-plus flight attendants are also expected to lose their jobs, according to newspaper reports.

Qantas CEO Geoff Dixon has reportedly committed to trim US$3.58 billion from fixed spending by mid-2008 through cutting jobs and other means.

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