Legal & General has announced plans to cut 1,000 jobs by mid-2027, representing about a tenth of the British insurance and pensions firm's workforce. The move is part of CEO António Simões' efforts to create a "leaner organisation" since taking over from longtime CEO Nigel Wilson in January 2024.
Legal & General's Restructuring Plan
The London-headquartered firm informed staff on Wednesday that it had begun eliminating approximately 1,000 roles by mid-2027, as first reported by Bloomberg News. Most of L&G's 10,000 employees are based in the UK. The programme will initially involve voluntary redundancies in the UK, but the company will consider mandatory job cuts depending on the take-up.
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The fund management division, which oversees £1.2tn in assets, is excluded from these cuts as it has its own restructuring plan. Simões, who previously worked for Santander and HSBC, announced a sharper focus on L&G's booming pensions arm in June 2024 and reduced the group's four businesses to three by merging its asset management divisions.
Strategic Shifts Under CEO António Simões
Since taking the helm, Simões has sold several "non-strategic" assets, the biggest being housebuilder Cala Homes, along with legacy land and real estate. He also brought in a new executive team and pledged to return more than £5bn to shareholders between 2025 and 2027 through dividends and share buybacks.
Simões told employees that the job cuts are "the next stage of that transformation." The company aims to streamline operations and focus on its core pensions and insurance businesses.
Impact on Employees and Operations
The job cuts will primarily affect UK-based employees. Legal & General has not specified which departments will be impacted, but the fund management division is excluded. The company will offer voluntary redundancy packages first, with mandatory cuts possible if not enough employees opt for voluntary departure.
This restructuring reflects a broader trend in the insurance industry, where companies are seeking efficiency amid economic pressures and changing market dynamics.
Comparison of Legal & General's Restructuring Timeline
| Phase | Timeline | Key Actions |
|---|---|---|
| Initial Announcement | June 2024 | Focus on pensions arm; merge asset management divisions |
| Asset Sales | 2024-2025 | Sale of Cala Homes and non-strategic assets |
| Job Cuts | By Mid-2027 | Eliminate 1,000 roles, initially voluntary |
| Shareholder Returns | 2025-2027 | Return over £5bn via dividends and buybacks |
Key Takeaways for Investors and Employees
- 1,000 job cuts planned by mid-2027, about 10% of workforce.
- Voluntary redundancies first, mandatory cuts possible.
- Fund management division excluded from cuts.
- CEO António Simões focuses on pensions and efficiency.
- Over £5bn to be returned to shareholders by 2027.
FAQ
How many jobs will Legal & General cut?
Legal & General plans to cut approximately 1,000 jobs by mid-2027, which is about 10% of its 10,000-strong workforce.
Why is Legal & General cutting jobs?
The job cuts are part of CEO António Simões' efforts to create a leaner organisation and focus on the company's booming pensions arm.
Will the job cuts be voluntary or mandatory?
The programme will initially involve voluntary redundancies in the UK, but Legal & General will consider mandatory job cuts depending on the take-up.
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