U.S. outsourcing firm Xerox has reportedly reversed its decision to fire hundreds of employees in Colorado Springs, saying that its client has agreed to extend its contract on the back of robust growth in business.
The outsourcer had handed pink slips to as many as 328 employees, but most will now be recalled. Not all the employees received pink slips had left the job because May 31 was slated to be their last day of work.
The company previously said cuts were necessary because of the “changing needs” of the client, but it now says the client’s business is growing and wants to extend the contract.
Of the 328 workers informed, 128 had been switched to positions with other Xerox clients, according to the Colorado Springs Gazette. The remaining 200 employees are being contacted.
According to a Xerox executive the Gazette quoted, as many as 90 employees have so far agreed to come back.
The Norwalk, Connecticut-based company is preparing to split into two businesses, separating its printer and copier unit from its business services unit. It acquired the bulk of the business services operations when it bought Affiliated Computer Services Inc. for nearly $6 billion in 2010.
Today, as much as 40% of its BPO business is with government entities, such as state Medicare and Medicaid agencies. One of the U.S. outsourcers cashing in on the sudden surge in call center service contracts triggered by President Barack Obama’s healthcare reforms, Xerox booked $146 million in write-downs last year, saying it was unable to handle some state Medicaid contracts.
In Colorado Springs, Xerox has employed more than 1,000 people and is providing back-office services such as tech support, help desk support and reserving orders.