EDS sends expensive US employees to the scrap-heap

ELECTRONIC DATA SYSTEMS, renowned for its outsourcing, has been scrapping jobs all across the States and hiring cheaper staff from lower-cost countries.

The company is sending out a load of dosh somwhere between the $70 million and $130 million mark to around 12,000 U.S. employees in the fourth financial quarter, it was said in a filing to the Securities and Exchange Commission. With an overall workforce of approximately 136,000, the early retirement packages dished out to U.S. workers will scrap just over 11 per cent of its entire staff.

EDS employees will have until the 30th of October to take the offer, according to eweek, with those who accept receiving a bonus of $10,000 from the retirement plan plus extra credits on their retirement accounts.

The move, approved by new CEO Ronald Rittenmeyer, is in a bid to bring a fair deal of profit back to the company by hiring cheaper labour in countries such as the Czech Republic, India and Brazil. It's estimated that between 38,000 to 45,000 new staff will be hired in such countries by 2008.

The company has tried a similar strategy before, offering 9,200 workers an early retirement package a couple of years ago, however it was only accepted by 1,500.

It's not certain how much the deal will cost the company as it is eagerly awaiting replies from its workers. µ