BoI and union welcome cuts deal

BANK OF IRELAND has struck a deal with its main union over plans to cut 2,100 people from its payroll.

The deal will mean no compulsory job losses, lump sum payments of up to eight weeks’ pay per year worked for those who depart and a doubling of the annual free share issue for staff. Other features include a commitment from the bank to bring in a maximum 35-hour working week for all staff and a formal agreement to consult with the union on issues affecting staff in the future.

The bank and the Irish Bank Officials’ Association (IBOA) said yesterday they were happy with the proposals, which were brokered through Labour Relations Commission (LRC) chief executive Kieran Mulvey.

The job losses will come from voluntary redundancies, early retirement, redeployment and outsourcing. The axe will fall mainly on credit management operations, call centres and human resources, but the bank will also make packages available to around 200 staff in areas that will be largely unaffected by the cull, such as branches, but who wish to leave for personal reasons.

The bank said Mr Mulvey’s recommendations were “fair and balanced” and would allow it to move ahead with its restructuring plans, which will cost more than €200 million. Chief executive Brian Goggin said: “The financial services industry is changing and Bank of Ireland is fortunate to be able to embrace this change from a position of strength.” IBOA general secretary Larry Broderick said the union would ballot members on the deal within weeks. “The voluntary redundancies and arrangements around outsourcing that will take place over the next three years are on terms agreeable to IBOA,” he said.

“Mr Mulvey’s recommendation also provides clear and absolute guarantees for staff, protecting their future terms and conditions of employment.”

The deal will allow some older staff to take early retirement with lump sums and full pension entitlements. Those with shorter service periods will also receive lump sums and reduced or deferred pensions. Staff with two years’ service will receive a minimum of €12,500 and those with the bank for a year will receive €10,000.

The IBOA said it was particularly pleased with the recommendation to double the staff stock issue. Staff will be given shares equivalent to 6% of their pay each year over the next three years. Mr Mulvey said he would intervene if the bank failed to pay the full 6% at any stage.

There will also be sweetheart payments worth at least €5,000 for staff affected by outsourcing arrangements.

Salaries, pensions and terms and conditions of employment will be fully preserved for employees who are transferred to the payroll of a third party supplier.