Ovo Energy, the UK’s third biggest supplier of gas and electricity, is expected to cut a quarter of its workforce while raising minimum pay for staff who remain.
The company, which employs around 6,200 people, is expected to reduce headcount by 1,700 as part of a voluntary redundancy scheme, as well as announce plans to “reshore” all customer-facing jobs to the UK.
The plans, which were first reported by Sky News and are likely to be announced today, also include a proposal to raise minimum pay across the company to £12 an hour.
Ovo Energy declined to comment on the redundancies.
The news comes as the company was forced to apologise this week after advising customers to cuddle their pets, eat porridge or do star jumps in order to keep their heating bills low.
Founder Steven Fitzpatrick blamed a “bad day” for the “embarrassing” advice being sent to customers.
Like many energy suppliers, Ovo – which is part of SSE – is facing rapidly rising wholesale costs. Gas market prices last month reached an all-time high of £4.50 per therm, about nine times higher than this time last year.
In 2021 more than 30 UK energy firms went bust, costing hundreds of jobs.
Unite has warned that more jobs losses in the sector and other industries might come, as as energy price rises hit organisations’ costs.
General secretary Sharon Graham said: “Our intelligence suggests that if the government does not intervene in the energy crisis then tens of thousands of jobs could go before the summer.
“Just how long is the government going to be a spectator in this coming jobs crisis? We need the government to intervene with a support programme to save jobs for the industry, and we need it now. We refuse to let workers carry the can for a crisis which is not of their making.”
The union called on the government to introduce an emergency jobs protection scheme for the energy sector, including short-time working programmes similar to Germany’s Kurzarbeit programme.
Unite’s national officer for energy, Simon Coop, said: “It is time for a national jobs protection programme to prevent a jobs catastrophe. The UK needs a short-time working scheme like other countries have. Of course, in the long term, the UK must create a balanced energy policy which, includes wind, solar, hydro, gas, clean coal and nuclear to lower energy bills in the future for all. But in this current crisis we need a significant financial package to fund a job protection scheme.”
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