National Life of Vermont Begins Job Cuts

March 19, 2004

The company that is taking over the information services technology division at National Life Insurance Co. in Montpelier has begun telling employees who will keep their jobs and who will be let go.

Of the 90 information technology workers in the systems development area of National Life transferred to the Keane Inc. information service company last month, about 35 will be assigned to the National Life account on a long-term basis, said National Life spokesman Brian Vachon.

The other 55 have begun to receive their “end dates” as Keane managers began meeting with individual employees this week.

Vachon said he wasn’t sure how many employees had been informed of their status. Employees will lose their jobs between May and November.

In total, 158 of the company’s 1,000 employees were transferred to Keane last month with a three-month guarantee of employment. That period will lapse at the end of April, and the company is now making decisions about which employees to keep.

National Life’s contract with Keane is for $65 million and company officials say the deal will save the company $20 million over five years.

National Life is a $10 billion to $12 billion dollar insurance and financial services corporation. The company employs 950 people in Montpelier.

In total, the company’s decision will eventually leave about 50 of its nearly 1,000 employees without a job, which has angered many of the displaced workers.

Company officials have said the job cutbacks were needed to keep National Life competitive. They say that while the company has seen record growth in sales in recent years, it has also received a “negative outlook” from A.M. Best and Standard and Poor’s.

Copyright 2004 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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