Business World

Saturday 26 May 2018

ECB payoff: Up to €100,000 for staff stuck in a rut

THE European Central Bank is offering payoffs that could go beyond €100,000 to staff whose careers have stalled, paid for by cheaper salaries for replacements.

A "Career Transition Support" programme is allowing officials to leave the bank with up to fifteen months salary and additional help if they have been in the same salary band for between eight and 12 years.

The ECB says the departure scheme was created to address "the specific demographic structures of the ECB" - an implication that it wants to lower its age profile - and to help staff who had failed to get promotions and "may want to pursue external career steps".

The average age at the ECB is now 43, up from an average of 36 a decade ago. Half the ECB's staff are now in the 40-49 age bracket and the average length of service across the workforce is 9.8 years.

The voluntary departure package also comes as the euro zone's central bank prepares to add up to 800 supervisors to work as banking regulator, a new remit for the institution.

These new officials will largely need different skill sets than the ECB's current workforce, which is focused on economics and monetary policy.

An ECB spokeswoman said it is expected to be "self-financing due to the difference in salaries between leavers and newcomers" with full pay back over five to seven years,

The scheme was launched in January 2013 to run for two years and fund a maximum of 50 departures.

In its first five months, 19 have successfully applied, the spokeswoman said. All eligible applicants have been accepted.

CAREERS ON HOLD

As well as one months' pay for every year they've worked to a maximum of fifteen months, staff who take up the scheme also get unpaid leave equal to the probationary period of the new job, 10 days leave for "preparatory activities outside the ECB" and in house training that covers areas like application and interview skills.

Staffers with the highest level of service could get well over €100,000, based on the ECB's average staff costs of just over €92,000 across its 1,600 strong work-force in 2012.

The staff cost average excludes pensions, includes allowances, and exclude the salaries of the ECB's six-member executive board, which would distort the figure upwards.

There are no restrictions on the who can apply, provided they have remained in their salary band for the requisite eight to 12 years.

"The (scheme) is a new and original framework, unprecedented in this way within comparable organisations, and hence there were no concrete expectations regarding its actual take-up," the spokeswoman said.

"We consider it rather a success that we have had 19 eligible applicants to date plus a good amount of staff who are seriously interested but still contemplating their career transition options."

A spokesman for the ECB's staff representative group described the take-up as "very low", something he attributed to the restrictive eligibility criteria and the low level of benefits.

"We welcome any measure which makes all parties happy," he said. "In this case, leavers are happy to leave, joiners to join (even if at a lower salary) and the ECB will increase the turn-over at no cost.

He added, however, that the scheme should not be seen as a solution to what he said was "the lack of career prospect and the absence of career planning" at the bank.

The ECB spokeswoman said the central bank did not have an automatic promotion system and promoted on merit after a competitive process as positions became vacant.

"As a consequence, a number of staff members may indeed not make it to a higher grade even if they are good performers and precisely for them the voluntary Career Transition Support to a job outside the ECB has been developed," she said.

 

Reuters

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