While Absa is playing a semantics game, stating that it is busy with a reassignment process and denying that it is in a retrenchment process, more than 150 employees are at home wondering if they will still have a job in three months’ time.
On the day Absa announced its annual results Moneyweb asked David Hodnett in a telephone interview whether Absa was busy retrenching IT employees.
Hodnett replied that Absa was focusing on how it could become more efficient group and that the IT division could be impacted like all other divisions.
In a conference call on the day of the results group CEO, Maria Ramos, stated that the bank was consistent with its message in the last year that it does not have a mass retrenchment process going on.
“We are focused on efficiencies. This does mean that sometimes if people can’t be relocated in the business there will be some exits. Most of the exits so far have been through natural attrition,” she said.
Apparently at about the same time, security guards were escorting some Absa IT employees to their desks to pack up their belongings and go home. These employees will apparently be on the bank’s payroll for three months while having to look for job opportunities within the group and outside as their positions are no longer available after an IT reshuffle.
Ben Venter, deputy general secretary of financial services union Sasbo, told Moneyweb that the more than 150 employees who have already received letters and were sent home, could be linked to a section of the business that Absa is looking to outsource.
He told Moneyweb that the bank did not want to disclose the company Absa will be outsourcing to.
Early on Monday Moneyweb sent through extensive questions regarding what happened on the 10th and the next steps in the process. Absa did not want to comment on any of these questions, simply stating that it has “commented extensively” on the matter and does not have anything further to add.
Trade union Solidarity, which also represents some members in Absa’s IT division, sent out a release on Monday stating that the process was not transparent and that Solidarity members were not given adequate information.
The union said it has sent a letter to Absa demanding that it “lay its cards on the table regarding the ‘restructuring process’”.
This comes after several Solidarity members in Absa’s system programming department were notified by letter in January 2012 that their functions would be aligned with those of the Africa Technology team. In terms of the restructuring, employees will have to reapply for their posts.
Solidarity maintains that the restructuring is nothing but a process of retrenchment, as numerous Solidarity members have already been asked to leave Absa’s premises after the company held discussions with them without notifying the trade union in advance.
The trade union has still not received any additional information about the planned restructuring, although Absa has already entered into consultations with the majority trade union, Sasbo.
Rumours abound that the pressure to cut costs comes from Barclays, as it is trying to realign divisions after the One Africa strategy was announced last year in April and increase efficiencies from its Africa operations.
Barclays said last week that it is making 20% of its £5.9bn profits on the African continent.
The One Africa strategy combined the operations of Absa Africa and Barclays Africa.
Barclays last year outsourced some of its call centre and back office operations to India.
While it seems Absa is trying to cut costs in the IT department by reassigning employees and asking contractors in a meeting last year November to cut costs by between 10% to 15%, another South African bank made it known that it is recruiting IT skills.
On the 15th of February Michael Jordaan, FNB CEO, used social media platform Twitter to tweet the following:
On Monday he tweeted again: