Unions to tell bank job losses not needed

WORKER representatives at Ulster Bank will today tell the company they believe almost 1,000 job losses are not necessary, the company’s target of getting rid of the staff cannot be achieved and they will not accept any compulsory redundancies.

Union officials will begin talks with management this morning in a bid to save some of the 950 jobs it is looking to axe on both sides of the border.

This announcement was the first in a series of expected cuts among Irish-based banks with up to 4,000 job losses expected in the industry before the end of 2012.

Just under 600 of Ulster Bank’s losses have been sought from branches and offices in the Republic. The company is determined to have the clear-out completed by the end of this year.

The branches will bear the brunt rather than the commercial side of the business. Ulster Bank’s proposals envisage 446 workers, or 18%, of its retail and branch division will be made redundant. An estimated 180 would be taken from its corporate arm.

The 950 figure was confirmed to staff as part of the company’s bid to cut its payroll costs by a suggested €60m. Compulsory redundancies have not been ruled out, though the company will first look for people to leave voluntarily.

The company wants to implement its plan in tandem with a wider cost-cutting programme announced by its parent group, Royal Bank of Scotland, which is separately seeking 3,500 redundancies internationally.

Union officials from the IBOA have said there needs to be clarity on how the bank expects to make the cuts, what terms will be offered and what knock-on effects there will be for its 1.9 million personal and business customers.

It said staff, savers and borrowers at Ulster Bank needed to know how they would be affected and whether the branch network would be scaled back.

IBOA general secretary Larry Broderick said he would be saying to the bank this morning that voluntary redundancies was the way it would have to go.

“This cannot be achieved over 12 months, that is unrealistic if we look at the idea of trying to retrain and redevelop people,” he said before pointing out there are a lot of long service staff in banks who could avail of early retirement.

The company’s topline redundancy target of 950 staff by the end of 2012 was confirmed to employees through the in-house computer network yesterday.

The bank would not discuss the possible departure terms that will be offered.

In 2009, when it looked for 750 and 250 employees to leave the company in two tranches, an offer of 7.25 weeks pay for every year of service was put on the table. This was brokered after negotiations were settled by the Labour Relations Commission.

This deal was improved for individuals in certain circumstances. At the time more workers expressed an interest in leaving the company than there were redundancy packages available.

However a spokeswoman for the bank said the current exit package would have to be discussed with employees before it is finalised.

The bank said it had no plans to close branches however it kept its network under review.

Between 2006 and the end of 2009 it spent €73m opening 23 new branches in the Republic.

Jobs history

ULSTER Bank’s current bid to make 900 of its staff redundant by the end of this year is the latest in a series of decisions by it to first expand, only to then slash its workforce.

At its peak, Ulster Bank had more than 6,700 people working for it. Most of these were based in the Republic.

This was a record figure, despite redundancy schemes announced in the late 1990s, 2000 and 2004.

At the turn of the millennium the bank employed 4,000, before a frantic bid to attract new customers, the take over of First Active and the opening of 35 new branches on both sides of the border.

In 2005, it had 5,276 permanent staff on its books in the 32 counties.

By the end of 2007, this had grown to 6,735.

Following the initial hit taken by RBS after the banking crisis, a voluntary redundancy deal was brought in. Throughout 2008/2009, this saw the total payroll drop to 5,700 people, with 7.25 weeks of pay offered for every year of service to all those willing to leave the company.

Despite the bank’s big problems residing in its commercial lending division, its ordinary customer business took the biggest hit at this time. This retail element absorbed 80% of the job losses.

In 2004, Ulster Bank cut 200 staff from its newly enlarged network, following its takeover of First Active. That year another 60 workers left the company as part of an outsourcing deal, others were transferred to RBS headquarters.

And in 2000, when RBS acquired the group, it fought the union in a bid to remove 20% of its retail staff from its books.

It appeared to lose in a battle of wills with the union, when the Labour Court ordered it to increase staff wages.