'Letters of comfort' with job guarantee given to 100 BoSI workers
MORE than 100 Bank of Scotland (Ireland) workers whose jobs are under threat are holding "letters of comfort" from the Government promising they will never be laid off, the Irish Independent has learnt.
The news comes after it emerged that more than 800 BoSI jobs are in jeopardy after the bank's owner Lloyds decided to withdraw completely from the Irish market.
The move will see 36 staff lose their jobs imminently while the remainder will be transferred to a new company set to administer the run-down of the bank's €32bn loan book.
The new company is likely to be wound up once the loan book has been repaid, triggering fears that all 800-plus of BoSI's workers will be laid off over the coming years.
The Irish Independent has learnt, however, that staff who joined BoSI when the UK bank bought state-owned mortgage lender ICC have "letters of comfort" protecting them from forced redundancies.
"Staff received a letter from the chairman of ICC's board guaranteeing they would not be subject to compulsory redundancies and their pension arrangements would not be disimproved," confirmed Brian Gallagher of trade union Unite, which represents BoSI workers.
"It [the letter of comfort] was open-ended and we'd argue that it still stands."
The Department of Finance last night declined to comment on the implications of the letters of comfort, while a spokesman for BoSI said the agreements were "confidential to the employees and the bank".
It is understood, however, that BoSI indemnified the Government against the letters of comfort when it took over ICC back in 2001, effectively leaving the bank exposed to any future actions.
Unite will begin engaging with BoSI management early next week.
BoSI chief executive Joe Higgins has indicated redundancy packages could be in line with those paid to the 750 Halifax workers laid off by BoSI earlier in the year -- reportedly about nine months' salary.