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Tieto cuts jobs, outsources work to cheaper countries

IT services firm Tieto has conducted numerous workplace negotiations this year. The latest round, which started in October, concluded on Monday with the company announcing job cuts that will affect 271 personnel.

Tieto Oyj:n pääkonttori Helsingissä.
Tieto Oyj:n pääkonttori Helsingissä. Image: Martti Kainulainen / Lehtikuva

Around 240 people will be given notice and some 30 asked to take unpaid leave. The exact amount of jobs to be cut is not yet known, but redundancies will be finalised by the end of the first quarter next year. The capital city region and Tampere will feel the brunt of the cuts.

Tieto announced in October that 350 positions would be surplus to requirement and commenced negotiations with employees. Country Director Ari Järvelä says that the remainder of the staff reductions were taken care of in the form of pensioning agreements or personal contracts.

"There have been some voluntary departures," says Järvelä.

Finnish workers too expensive

According to him, the company must shed the jobs because data centres have become automated and routine work is being transferred to lower-cost countries. Järvelä also claims that a transformation in the telecommunications sector that has resulted in overcapacity.

Tieto will soon reach a landmark two years of turbulent job losses. The company has overturned 1,000 jobs in Finland between 2012-13.

Sources: Yle