EDS is offering early retirement packages to about 12,000 of its US employees as the company continues to look for more costs to cut and opportunities to move a lot of its outsourcing work to offshore centers such as India.
The company expects that the retirements could be in the range of $70m to $130m, although it won’t have any specific numbers until after the offer period ends on October 30. EDS plans to take the charge on its Q4 earnings this year.
EDS hasn’t hid its intentions to shave its US payrolls and get more work up and running in India, even after its acquisition of Mphsasis, which vastly improved its offshore headcount. The question is how many employees will now opt for early retirement, and with a number of service companies already cutting their retirement plans, what steps EDS and its rivals will come up with to keep a lid on their US costs.