NEWS & ANALYSIS

How Absa is cutting jobs by stealth - Solidarity

Dirk Hermann says business units are being "restructured" one by one

More Absa employees get notice of restructuring

Trade union Solidarity said Absa's plans to restructure gained new momentum this week when more employees received a letter, informing them that their jobs will be affected by the restructuring. Several employees' services will be terminated as early as the end of March.

"It is clear to us that Barclays' grip on Absa is getting tighter. Our information is that Absa was instructed by Barclays to cut personnel expenses by 10%," said Dirk Hermann, Deputy General Secretary of Solidarity. Absa CEO Maria Ramos last week denied that Absa was planning to carry out mass retrenchments.

The latest letter regarding the restructuring was sent out on 19 March. The employees who will be affected the most by the restructuring process are business analysts in the IT department and employees in the retail department. According to Solidarity's source at Absa, the IT department will be reduced from 1 200 to 700 staff. Several other business units are also affected by the restructuring plans. The services of employees in the consultant and actuarial units will be terminated as soon as 31 March.

"Although Ramos denies that mass retrenchments will be carried out in one fell swoop, it is clear that Absa's strategy is to restructure business units one by one. The impact of the process is therefore being spread out. Employees are first informed that there is no room for their posts in the new structure, after which they are given a chance to apply for their own posts.

The problem is that there are fewer posts than staff. The last step is therefore to retrench staff. No one currently knows exactly how many employees will be appointed in new posts or retrenched and when this will happen. Absa has so far refused to reveal the full scope of the restructuring," explained Hermann. According to Solidarity's source at Absa, as many as 3 000 posts may be affected by the process.

"We call on Absa to disclose the full scope of the process," Hermann added.

Examples of the notices served on employees follow below.

Example 1

Example 2

Statement issued by Dirk Hermann, Deputy General Secretary: Solidarity, March 23 2012

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