HP to furlough 4,000 contractors

Hewlett-Packard Co. (HP) is furloughing for three weeks most of its North American network of outside contractors that provide IT support, a move the company estimates will save it US$15 million to $20 million.

About 4,000 contractors from a number of firms will be affected by the work stoppage, scheduled for June 24 through July 12. Those contractors handle aspects of HP’s Web site and other IT infrastructure tasks overseen by HP Chief Information Officer Bob Napier, according to HP spokesman Arch Currid.

A small number of essential contractors will continue working during the furlough. HP is in the process of reevaluating its contracts and canceling those it no longer needs, Currid said.

The move comes as HP focuses on cost reduction following its acquisition of Compaq Computer Corp. HP Chairman and Chief Executive Officer Carly Fiorina has pledged that HP and Compaq will cut their combined operating costs by $2.5 billion by October 2003, the end of HP’s 2003 fiscal year.

HP is online at http://www.hp.com