British council to sack, re-hire 6,500 staff to save cash

6th July 2011, Comments 0 comments

A council in central England is sacking all 6,500 of its employees and will offer them new contracts with a 5.4 percent pay cut to help save millions of pounds, a spokesman said Wednesday.

Shropshire county council expects to save £7 million ($11 million, 7.8 million euros) from the move, and says the alternative would be to scrap 400 jobs as it struggles with a £76-million budget cut over the next three years.

All local authorities in Britain are having to make savings, as Prime Minister David Cameron's coalition government slashes public spending to help bring a record buget deficit under control.

"The council has decided, reluctantly, to make these changes by way of terminating the contracts of all current staff, and then making all staff an offer of immediate re-employment on new terms and conditions with effect from 1 October 2011," said Jackie Kelly, head of organisational development.

Shropshire Council said it was forced to act after failing to reach agreement with trade unions on pay cuts, although it said it would continue negotiating.

A spokesman said the new terms would not apply to teachers or those earning less than £13,000 a year, adding: "We are not the only council to be doing this."

The government has imposed a two-year pay freeze and is expected to slash about 330,000 public sector jobs in the next four years as part of the cuts.

© 2011 AFP

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