The Post Office made headlines with a troubling trend: they let go of permanent IT staff only to bring them back at shocking pay rates. Jane Davies, who served as the chief people officer from December 2022 to June 2023, uncovered this practice, especially prevalent in the IT department. It didn’t take long for her to notice that some employees who were fired returned to the same roles at rates three times higher than their original salaries.
This was happening while the IT team worked on replacing the controversial Horizon system from Fujitsu, a key issue in the Post Office scandal. In her testimony during the public inquiry, Davies highlighted a practice called “flipping,” where friends or former colleagues of laid-off staff were rehired at exorbitant rates. She criticized the Post Office for not managing public funds responsibly, calling out their failure to ensure that spending was justifiable and provided value to taxpayers.
Once these employees were flipped, their pay skyrocketed. Davies pointed out how full-time workers were suddenly earning daily rates two to three times their previous salaries, a complete departure from proper fiscal management. The lack of formal reviews or approvals for these contractor rates meant the department often agreed to excessive payments. This didn’t just hit the budget hard; it also resulted in the loss of permanent talent, driving up costs further with the need for temporary replacements.
Davies raised her concerns repeatedly with outgoing CEO Nick Read. In her emails, she highlighted the reckless spending in the IT department, particularly regarding contractors. One notable case she shared involved a senior IT manager, who made about £120,000 a year before being let go but was rehired the next week at a staggering £1,500 a day—equating to a whopping £360,000 annually.
Things are shifting now. The Post Office has appointed a new chief for the IT department, Andy Nice, to oversee the crucial project of replacing the Horizon system. Recently, the new leadership announced layoffs of 80 consultants and 29 contractors, adding to the 100 already cut. However, this comes on the heels of a significant cost increase in the Horizon replacement project. A review from government project management experts had rated the initiative as “currently unachievable,” with costs ballooning from £180 million to a staggering £1.1 billion, not to mention delays stretching up to five years.
As for the Post Office, no response had been provided to inquiries at the time of reporting. It’s worth noting that the Post Office scandal first came to light back in 2009, illuminating the harrowing experiences of several subpostmasters affected by the faulty accounting software.