Does no one want to leave Irish banks?
Irish banks are making redundancies, this is no secret. However, one positive among the all this retraction was that most would be done on a voluntary basis. This is no longer guaranteed.
The finance union, IBOA, is reported to have been in talks with AIB to seek some reassurance that the anticipated 2,000 redundancies will be voluntary. Unfortunately, it's yet to receive any commitment on this.
The question has to be asked why AIB is feeling compelled to make the job cuts compulsory, and whether Bank of Ireland is likely to do the same for its 750 redundancies currently being implemented over the next two years.
Previous redundancies programmes within Ireland's banks have been over-subscribed, yet with the job market so depressed few people are willing to put themselves forward for the current round of cuts.
"While other redundancy announcements were within banks either closing or retrenching from Ireland, both AIB and Bank of Ireland are supposed to be the future of Irish banking," says Eoin Blake, director of Irish financial headhunters Lincoln Search & Selection. "Bankers are looking at their options, and deciding it's too risky to take the money and run."
Shrinking redundancy payments
It could also been down to the fact that Irish banks are being decidedly less generous when it comes to redundancy packages.
"There have been suggestions that banks in Ireland just going to offer the statutory minimum, but I don't think it will go that far," says one employment lawyer in Dublin. "But they're definitely being reducing redundancy packages because of the politics around banker pay and the fact that the government has hold of the purse strings."
Peter McInnes, partner in the employment practice at McDowell Purcell Solicitors in Dublin, says that his department is being "swamped" with claims for unfair dismissal relating to selection for redundancy across various industries and that the waiting time for an industrial tribunal is now 18 months.
Banks could therefore find themselves in lengthy legal wrangles if they opt for compulsory redundancies or packages shrink too much.
The statutory minimum is two weeks pay for every year of service, plus one further week's pay. Even if this seems unlikely, you should expect less if you volunteer for redundancy.
Before AIB fell into government hands, it was offering around eight weeks pay for every year of service. Despite public outrage that the bank is being overly generous, it's set to offer six weeks' pay plus statutory redundancy, capped at 2-2.75 years.
Bank of Ireland, which has so-far escaped majority government ownership, is offering the same, but capped at 2.5 years.
