Union accuses HP of cashing in on $7m job fund

 

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By Stewart Mitchell

Posted on 26 Aug 2010 at 11:58

The Unite union has accused HP of taking advantage of a “public subsidy merry-go-round” after the company received £7 million in aid to create new jobs at its Erskine plant in Scotland.

While the union welcomed the 700 new jobs, it suggested the company is cashing in on subsidies to create new jobs just 16 months after axing 700 jobs at the same plant and moving their roles to the Czech Republic.

“It looks like the company is using the public subsidy merry-go-round to create jobs to replace those that it transferred to Eastern Europe where labour costs are cheaper," said Peter Skyte, Unite’s national officer for IT and communications.

It's getting taxes to sack and rehire people

"And as we speak, coincidentally, HP is looking to axe another 700 employees from across the UK. It's getting taxes to sack and rehire people,” Skyte told PC Pro.

The £7 million fund was granted yesterday by Scottish Enterprise as part of a plan to create 700 new jobs at the plant by 2014.

The new roles focus on supply chain, marketing, customer support and telephone and web sales, while the jobs relocated last year were in production positions. However, Unite feels the company has effectively rotated 700 positions and pocketed £7 million in the process.

“We will be demanding that the company uses this opportunity at Erskine to redeploy employees from the current workforce who face possible redundancy in two months,” said Skyte.

Unite is also concerned that HP and other large corporations can take advantage of such funds from local and national authorities, then move to another location if they are offered better tax relief or subsidies.

"There's always a danger that when governments and local authorities try to attract investment with financial assistance that large corporations will play one area or country off against another," said Skyte. "They can use public money to shift production where it most benefits them."

HP had not returned a request for comment at the time of publication.