Insurance provider Axa PPP Healthcare is to increase working hours for its senior managers at no extra pay, as well as asking them to choose to either take a pay cut or a reduction in their annual bonus.
The firm is making the changes after a review led by its chief executive Keith Gibbs identified the need for it to improve the efficiency of its operations by reducing its expenses base by between 10% and 15%.
After Axa PPP Healthcare obtained feedback from its 1,800 staff on ways in which money could be saved, the firm introduced a series of measures which will see a 7.15% increase in working hours for no additional pay become compulsory for senior managers.
In addition, this section of the workforce must opt either for a reduction of their annual bonus payment. Based on an employee’s level of seniority, reductions in salary will range from 1.5% up to a maximum of 5% for those in the most senior positions. Reductions in bonuses will range from 15% up to a maximum of 50% for high level staff. Both of these measures are to apply for a three-year period.
The rest of the workforce will be asked to choose either a 7.15% increase in working hours, a 5% pay cut or a 50% reduction in their annual bonus payment.
Employees have been given the opportunity to respond to the proposals this month, which are due to be formally offered at the beginning of August. It is likely the measures will be enforced after a three-month notice period.
Keith Gibbs, chief executive of Axa PPP Healthcare, said: “The measures we are taking will enable us to strengthen our business and ensure a more secure future.The increased capability the additional working time and other cost saving measures bring will boost our competitive edge while maintaining our strong customer focus.
“Axa PPP healthcare has a strong, experienced team, built up over many years.They have been instrumental in delivering the high-quality customer care that helps to make us an acknowledged market leader and they have a key role to play in our continuing success.
As a part of the review, Axa PPP Healthcare has also decided to scrap a number of fringe benefits. These include cancellation of the company’s Christmas party allowance and Christmas gift. In addition, no free fruit will provided on Fridays and the firm’s gym subsidy will be phased out. Additional car parking will be cut back for employees and the staff restaurant will close.