DUBLIN (Reuters) - Bailed-out Irish lender AIB (ALBK.I) is outsourcing 170 of its information technology jobs after a review of its IT operations, but will not make any redundancies in the area, the bank said on Tuesday.
Fears of job losses were triggered when the bank called 250 IT staff to a meeting earlier in the day to announce the results of the review which it launched in October.
“AIB today confirmed that it is entering a process of consultation with employee representatives to discuss the bank’s plans to outsource a number of its IT services to Eircom, Integrity and Wipro (WIPR.NS),” the bank said in a statement.
A spokeswoman said that 170 jobs were being outsourced but there would be no redundancies. The terms and conditions of staff transferring to the new companies will be protected in line with European Union law.
Speaking after the talks, Larry Broderick, head of the IBOA trade union told Irish national radio that the IBOA would begin talks with AIB over the terms and conditions for transferring workers.
“It may very well be that the ask for some of these members may be difficult and voluntary redundancy may have to be considered,” Broderick told RTE radio.
Earlier Broderick had said he feared some jobs might be cut while Irish media reports said that as many as 450 jobs could go. Broderick said any cuts would be a particular concern “at a time when AIB has come back into profitability and (employees have) made significant sacrifices to turn the bank around”.
Ireland’s Department of Finance, which oversaw a 21 billion-euro (£16.3 billion) bailout of AIB at the height of the financial crisis, on Monday announced that it had appointed Goldman Sachs to advise on a sale of the bank and that it was confident it would recoup its full investment.
After five years of bruising losses AIB turned a profit for the first nine months of 2014 and has begun ‘writing back’ some of the provisions it took against loans judged unlikely to be repaid in full.
The bank, Ireland’s second-largest by assets, has already cut staff numbers substantially. It employed the equivalent of 11,385 full-time workers in June 2014, down 1,333 on the figure a year earlier. In 2008, before the crisis hit, it had about 26,000 staff, of which about 10 percent were part-time.
The sharp cut in AIB’s staffing, a politically-sensitive issue for a state-owned bank in a country with historically high unemployment, was achieved through a combination of selling off businesses, redundancies and not replacing staff who left.
Editing by Jason Neely and Greg Mahlich