Wednesday 17 January 2018

AIB workers won't know if they'll keep jobs until next year


Laura Noonan

AN announcement on AIB's 2,000 job losses is now not expected to come until early next year once the nationalised bank and its trade unions have sat down with a "third party" to agree a package.

Sources this weekend confirmed that AIB had still not identified where it wants to cut the 2,000 jobs from -- even though the job cuts were announced in principle in April.

"It's an appalling scenario," said Larry Broderick, head of workers' trade union, the IBOA.

"People have been coming to work every day since April knowing jobs are going to be cut, but not knowing where from."

Mr Broderick said there was also still no clarity on the financial package that the Government would allow AIB to offer to the departing workers.

In a communication to all staff in July, AIB executive David Hodgkinson said he hoped to begin implementing the 15-month redundancy programme in October.

"There's no timescale for implementation now, we're not even at a stage where I think it will happen before Christmas," he said, adding that talks would begin through a "third party" over the coming weeks.

A spokesman for AIB declined to comment on whether the delay stemmed from the bank's desire to wait for its new chief executive David Duffy to be in place before a deal was sealed.

"We are working with staff representatives to agree the terms and conditions of a severance programme. We are working to finalise it by the earliest possible date," he said.

The Department of Finance will ultimately have to approve the package offered by AIB and is keen to ensure that it is in line with recent public service norms rather than previous banking packages.

Banks have typically paid about six weeks' salary plus two weeks' statutory pay per year of service; a package recently offered by Anglo Irish Bank was capped at four weeks' pay per year of service, including statutory entitlements.

The offer was greeted with "disappointment" by the IBOA. The union is expecting Ulster Bank to launch a new redundancy round soon, and will be pushing for terms similar to the last Ulster Bank package, Mr Broderick said.

That 2009 package included 7.25 weeks' pay per year of service, plus a retraining grant of €9,280, or a straight eight weeks' pay per year. The offer was massively oversubscribed.

In his July email on the redundancies, Mr Hodgkinson said it was "frustrating" that there was still no clarity on severance packages, adding that the bank had been in talks with the Department of Finance for a "considerable period".

When the redundancy programme was first flagged back in April, Mr Hodgkinson said pay-offs should be "generous".

Irish Independent

Promoted Links

Business Newsletter

Read the leading stories from the world of Business.

Promoted Links

Also in Business