In the space of one week terms have been either agreed or proposed that will see 4,500 staff leave the financial sector.
The exodus from AIB (2,500 staff), Bank of Ireland (1,000) and Ulster Bank (950) is only likely to grow with major changes afoot at Northern Bank, Permanent TSB, and other financial institutions.
In response, its general secretary Larry Broderick called on the Government to develop an employment strategy for the sector.
At Bank of Ireland, finance union IBOA has recommended its members accept the terms on offer to 1,000 staff to take voluntary redundancy.
Those who do will be given three weeks’ pay per year of service plus statutory redundancy. The payments will be capped at two years’ salary or €225,000 (or sterling equivalent), whichever is the lesser amount. Staff with more than two years’ service will receive a minimum payment of €10,000 (or sterling equivalent).
* An early retirement option will allow staff who are within five years of optional early retirement or normal retirement date under existing pension rules to leave the bank. According to IBOA, that option will allow the staff to avail of an arrangement which will provide 70% of the redundancy terms and 50% of salary for a maximum of three years;
* Departing staff will also be able to avail of a training grant worth up to €5,000 (or sterling equivalent) vouched.
The redundancy terms at Bank of Ireland are a reflection of the changing times in the financial sector. In Apr 2011, six weeks’ pay per year of service was on offer to staff.
At AIB, those who choose to leave will receive a severance payment which is the better of three weeks’ salary per year of service plus statutory, or four weeks’ salary per year of service inclusive of statutory. An upper limit will apply, with payments capped at the lesser of two years’ salary or €225,000.
The terms are available to staff with a minimum of five years’ continuous service.
The early retirement scheme will be available for staff aged 50 and over but will be on a pro rata actuarially reduced basis.
Both AIB management and the IBOA are to take time to consider the recommendation from Kevin Foley, director of conciliation at the Labour Relations Commission.
AIB has told staff it will communicate its decision on the package to staff early next week.
Mr Broderick said: “[AIB] has yet to share its plans for the future with us in any real detail.
“This is absolutely essential to enable staff to make a fully informed assessment about what is potentially a life-changing decision for each employee.”
He said the union was seeking an urgent meeting with senior management to discuss its plans for the future and the implications for staff and customers.
© Irish Examiner Ltd. All rights reserved