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Insurance giant Axa is shedding 120 jobs from its Dublin office.

The news comes just a week after fellow insurer Hibernian announced plans to offshore 580 Irish jobs to Bangalore in India.

Axa is planning to cut the jobs by seeking 120 voluntary redundancies across its 1,000-strong Irish workforce. The company is also seeking to restructure pay scales across its remaining staff, in a bid to cut costs.

The moves come after Axa's turnover plummeted by 40pc in the last three years amid fierce competition in the insurance market.

The plans have already been discussed in detail with trade unions AMICUS and SIPTU, and the result of a worker ballot due back next Monday.

The terms of the deal will see departing workers emerge with packages of up to €200,000 or early pensions, while remaining workers will face revamped payscales.

"We are doing it, but it definitely won't be a forced situation," Axa Ireland boss John O'Neill said, when contacted by the Irish Independent last night.

"With the way our sales have gone over the last few years, we couldn't afford our level of expenses."

Axa has traditionally been one of the higher payers in the insurance industry, offering a range of perks including reduced insurance rates.

Thresholds

The company's pay scale has seen staff come in for almost automatic annual pay rises, with thresholds as high as €60,000 for some administrative jobs. Mr O'Neill said some 40pc of Axa's Irish staff are over 45, and many have spent more than 20 years with the insurer.

"With technology the job has gotten a lot less interesting for older people because it's become very automated," he said.

"Those who are in the 50s age range would probably be looking at the early pension option, so it would be more early retirement than redundancy, but the effect is the same." For remaining staff, Axa wants to remodel its pay scales by lowering the limits in pay bands, for example introducing a €30,000 to €60,000 band instead of a €30,000 to €70,000.

The company also wants to make progression in the pay scales more merit-linked.

Meanwhile, the effects of the economic downturn are also being felt across the border after it was yesterday announced that 60 glass workers in Co Down are facing compulsory redundancy. The jobs are being lost at Toughglass, Kilkeel, where more than half the workforce is to be made redundant after a sharp fall off in demand.

Laura Noonan