Private medical insurance provider AXA PPP has, after consulting its circa 1,800 employees on cost saving options, decided to scrap its Christmas party allowance and its weekly free fruit perk as part of a series of cost-cutting measures.
The company will also phase out its gym subsidy, cut back on car parking for employees and close its staff restaurant. These cuts follow a consultation exercise in June when staff views were sought on a range of cost saving measures.
AXA PPP staff will now be asked to select one cost-cutting option that they prefer. Those below the level of senior manager will be asked to choose from:
- A 7.15% increase in working hours (about 30 minutes a day) for no extra pay
- A 5% reduction in salary
- A 50% reduction in their annual bonus payment
Employees have until the end of July to make their choice and should be made a formal offer on 1 August. Three months notice of these changes will be given and they should come into force for three years from 1 November.
Senior managers will be compelled to accept a 7.15% rise in working hours for no extra pay. Also they will be able to choose between a salary reduction or a cut in their annual bonus.
AXA PPP said senior manager salary reductions will range from 1.5% to 5% for the most senior managers. Bonus cuts will range from 15% to 50% for very senior management. These measures will apply for three years.
Chief executive Keith Gibbs 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 base.”