24 April 2007

Air NZ Finance outsourcing proposal “off the table”

Air NZ told 178 staff today that the proposal to outsource its Financial Shared Services to India had been withdrawn.

Service and Food Workers Union members were told at a special meeting called by the company that the decision was “not a postponement”.

“The proposal is off the table,” says SFWU Northern Regional Secretary Jill Ovens.

Air NZ Finance staff, who are SFWU members, were relieved to hear their jobs were safe, but angry at the stress they had been put through for more than a year.

“They feel they should be compensated for sticking with the company even after they were told they weren’t wanted any more and their jobs were to be disestablished.”

Ms Ovens says the Union had always questioned the wisdom of outsourcing Air NZ’s Finance operation.

“It was an extraordinarily risky thing to do with our national airline.”

Air NZ originally planned to outsource its finance operations to Fiji, but abandoned that in the face of continuing political uncertainty following the recent military coup.

The company then turned to India where they held discussions with three different outsource providers.

Ms Ovens says a major problem was on-going management of outsourcing to India.

“There were issues of how to maintain control, especially given difficulties in getting there. There is also a huge difference in time zones which means their staff would be working a graveyard shift during our daytime.”

Ms Ovens says the Union had queried the revised business case after Fiji was rejected, but Air NZ had refused to “open the books” as they investigated options in the Philippines and China, as well as India.

“As it turned out, the main problem for them was that the cost savings just weren’t there,” Ms Ovens says.

“Management refused to accept their process was flawed in any way. In fact they told our members today that they would continue to push hard for change to reduce cost and increase the company’s profitability.”

Ms Ovens said the warning of continuing changes did not give much comfort.

ENDS

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