M&S singles out IT contractors in plans to cut 525 jobs and shift out of London

IT and logistics staff to go at M&S to pay for shop floor wage rises

IT staff are in the firing line at M&S as the company announces 525 job cuts and plans to relocate activities from its London head office - with contractors top of the list for cuts.

The cost-cutting reorganisation follows a 14.7 per cent rise in the company's pay bill at the same time as the retail giant is grappling with clothing and home sales down by 8.9 per cent.

In a statement today, the company said that the plans were intended to "reshape and redefine the organisation by reducing the number of head office roles by a net reduction of about 525 roles and also reduce the number of roles permanently based in central London by about 400, across IT and logistics, as part of the retailer's strategy to work more simply and more efficiently".

The statement singled out contractors, in particular, for cuts but full-time staff will also be in the firing line, it admitted: "The net reduction would be achieved through a combination of fewer contractors, natural attrition and redundancies for M&S employees."

CEO Steve Rowe suggested that the company needed to "become a simpler and more effective organisation" and that the cuts were "absolutely necessary" to "help us build a different type of M&S - one that can take bolder, pacier decisions, be more profitable and ultimately better serve our customers".

It follows an internal review of the company that concluded that M&S had become "too complex and inefficient" with duplication of activities and a lack of clear accountability for decision-making.

The company has already opened consultations with staff over the job cuts, which come one week after the company offered shop staff a 14.7 per cent pay rise, which would take in-store wages to £8.50 per hour or £9.65 in London.

In recent years, M&S has invested a great deal in IT in a bid to compete online, as well as to update its IT and logistics systems in-store.

In 2012, it revealed to Computing its plans to ditch Amazon as its online platform host and to spend £100m on building and running its own e-commerce platform in-house. It has also been active in recruiting talent for its "elite" in-house software development team.