Australia Post cuts IT contractors due to coronavirus

Australia Post has cut loose a number of IT contractors after pausing or stopping projects in the wake of the coronavirus pandemic.

The decision was taken by the government-owned corporation last week in a bid to reduce costs until the economic uncertainty comes to an end.

It comes as the government scrambles to deliver its $130 billion 'JobKeeper' wage subsidy to employers in a bid to curb mass layoffs triggered by COVID-19 control measures that have forced mass business closures.  

Australia Post confirmed to iTnews that a “select number of programs of work” had been paused or ceased due to the uncertainty, though said only some IT contractors had been impacted.

“In light of current conditions and the uncertainty brought about due to COVID19, Australia Post has paused or stopped a select number of programs of work, and as a result, has had to give advance notice to some of our contractors in technology roles,” a spokesperson said.

But sources have told iTnews that the decision has impacted a large number of the postal corporation’s contractor workforce.

Over the course of the 2018-19 financial year, Australia Post employed 358 IT contractors at a cost of $65 million, according to documents provided to senate estimates last year.

Other sources have said the decision has stopped all IT project work, resulting in all contractors being stood down.

Australia Post has spent more than $500 million on IT contracts since 2013-14, including $136 million over the last two financial years (2017-18 to 2018-19).

The postal corporation is currently rebuilding its legacy core layer in a public cloud environment, building on earlier work to migrate off traditional on-premise hardware.

The decision to cull at least some of its IT contractor workforce comes despite government restrictions on non-essential activity not applying to postal operations.

And with much of the country’s workforce now confined to their homes, the number of parcels processed by Australia Post is only likely to increase.

The postal corporation has already stepped in to help Woolworths deliver groceries to vulnerable Australians to ease the strain on its delivery network. 

It is not clear whether all contractors are eligible for the government’s JobKeeper payment, which will see companies receive a $1500 fortnight subsidy for each staff member if turnover has fallen by 30 percent due to COVID-19.

Eligible employees are full-time and part-time staff or long-term casuals that have been employed on a regular basis for more than 12 months.

Know more? Contact jhendry@nextmedia.com.au