Financial services company Aviva will cut fewer jobs than had been anticipated when it announced 950 redundancies last October.

Instead of shedding 770 positions at the Irish operation, Aviva will make between 500 and 550 people redundant.

In addition, it is creating 220 new posts in Galway.

Departing staff will receive a redundancy package worth six weeks per year of service, the company also said today.

Aviva and the Unite trade union have agreed terms for restructuring the company over the last six months.

180 jobs at Aviva Europe are already gone. However, instead of losing 770 positions from the Irish operation, around 540 staff face voluntary redundancy - an improvement on what was expected.

In addition, the company is creating 220 jobs in claims insurance and direct sales in Galway, with recruitment to begin in the summer.

New actuarial and underwriting pricing centres in Dublin will service Irish and UK customers.

The redundancy package will be worth six weeks per year of service capped at two and a half years.

For those who stay, there will be a move towards more performance related pay, though sources said there would be no cuts in basic pay.

Aviva began informing staff yesterday evening.

Unite Regional Officer Brian Gallagher said they remained disappointed at the number of job losses, but pointed out that redundancies had been reduced from 770 to 540 - with extra jobs secured in Galway. Unite expects to recommend acceptance of the terms - with a ballot commencing in a fortnight's time.