IT workers at Oxford Health Consider CSC's job offers

January 3, 2001 —

Some of the IT staffers at Oxford Health Plans Inc. are weighing their job options after the health maintenance organization officially announced a major outsourcing deal with Computer Sciences Corp. (CSC) last week.

Oxford said the 150 IT workers affected by the agreement will all be offered jobs at CSC that would become effective on Dec. 1, when the Trumbull, Conn.-based HMO is due to start transitioning some of its key technology services to CSC. Included in the deal are Oxford's data center, help desk, desktop support and network management operations. The company's IT workforce totals 440.

The five-year contract, with a value estimated at $270 million to $330 million, wasn't a surprise to Oxford's IT group.

As reported previously, the HMO's staffers were told of the planned move at a Nov. 6 meeting with CSC officials and were promised job offers, although specifics weren't provided at that time.

Employees who accept positions with El Segundo, Calif.-based CSC will get salaries and benefits that are "comparable" to what they have now, according to Oxford's announcement of the agreement.

The HMO isn't expected to offer any severance packages to workers who reject the CSC jobs.

According to a source inside Oxford's IT group, most of the job offers appear to include salaries that are slightly higher than the current ones, to make up for drops in other aspects of compensation such as retirement plans and vacation accrual.

"[We] will lose a number of key benefits, principally any unvested stock options and unvested . . . 401(k) [contributions]," said the source, who hasn't decided whether to sign on with CSC.

The affected IT staffers will also have to move to CSC's facilities in Norwich, Conn., which is about 50 miles away from Oxford's data center. Oxford and CSC said the transition process is expected to be completed by December 2001.

Ups and Downs

The IT group at Oxford has been through numerous ups and downs, as well as new managers, since a botched 1996 migration to homegrown software for managing the HMO's membership and processing claims. Oxford officials didn't return calls seeking additional comment by press time.

In a separate announcement issued by CSC, Charles Schneider, Oxford's president and chief operating officer, said the agreement "will help us reduce our costs and upgrade our technology capabilities."

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