The company expects about half of these cuts to be made through turnover and attrition and about half through redundancies. However, due to investment in growth areas Centrica estimates the net impact on headcount to be about 4,000 roles.
The plans were announced in the organisation’s interim results for the period ended 30 June 2015, which also reported that Centrica group profits fell 3% to £1 billion. This is despite British Gas reporting a doubling of profits in the first half of 2015.
Given the numbers involved, British Gas will probably have to go through collective consultation said Beverley Sunderland, managing director of Crossland Employment Solicitors.
“While the law provides for statutory redundancy – which caps a week’s pay at £475 and an employee gets a week’s pay for every complete year worked, multiplied by 0.5, 1 or 1.5 depending on their age – British Gas might want to be more generous, or they might have a contractual redundancy scheme that gives their employees more,” she said.
She added: “The consultation will also decide important factors such as the selection criteria to use when choosing which staff will lose their jobs. Meetings will then have to take place with selected employees and British Gas will see if there are other jobs they can do in the company.
"If British Gas is being more generous then it will probably want staff to sign a settlement agreement containing restrictions on the employees about saying derogatory things about it, particularly on social media. British Gas might also consider matters such as offering outplacement to employees, to help them find new jobs.”
Iain Conn, Centrica chief executive, said that the strategic review provides a clear direction for the business. “Centrica is an energy and services company,” he said. “Our purpose is to provide energy and services to satisfy the changing needs of our customers, and as such we will focus our growth ambitions on our customer-facing activities.”
