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Jan 21, 2001

Outsourced but then only offered 50% severance package

Crikey's fly on the wall at Westpac is not at all impressed with the IT outsourcing deal that is driving profits ever higher and giving staff limited options and entitlements.

Crikey’s fly on the wall at Westpac is not at all impressed with the IT outsourcing deal that is driving profits ever higher and giving staff limited options and entitlements.

On January 31st last year, Westpac announced that they were going to outsource their IT & Communications areas. So what? Well these people are responsible for running the systems that update your bank balance, keep the ATMs & EFTPOS machines functioning & allow the rest of us to participate in what is known as the cashless society. The workers who are responsible for running and maintaining these complex computer systems for the oldest Australian bank have just been “sold” to two of the biggest companies in Australia in IBM Global Services & Telstra without having the benefit of taking full redundancy or a comparable job within the bank.

It has taken a protracted series of hearings within the Australian Industrial Relations Commission, the AIRC, for these people to be granted the ” privilege” of a 50% redundancy payment if they choose not to work for IBM or Telstra. The presiding judge even went so far as to say that Westpac had misled their employees in stating that they would have a clear choice in terms of taking redundancy or a position with the outsourcer. Although he was clear in absolving the bank of deliberate misrepresentation his ruling was emphatic in it’s condemnation of the bank’s policy of offering it’s employees no real choice between taking a position with the outsourcer or a nil redundancy prior to his decision.

The frightening aspect of this whole process is that it has set a precedent for large & successful corporations to absolve themselves of their traditional responsibilities to their workforce. The context in terms of banking is similar moves in other organisations eg. ANZ, St. George, NAB & the previous Commonwealth Bank/EDS outsourcing in forcing workers into unwanted & unfair work contracts & conditions with the only real alternative being unemployment.

The Westpac decision has set the stage for more large scale redeployment of ordinary workers in order to finance artificially inflated share values & soaring executive salaries. Misrepresentation, inaccurate communications to workers, withholding of vital information such as superannuation payments & disbursements which directly mislead both the workforce & the outsourcing companies are real & frightening practises currently being used. To allow these injustices to go unnoticed is to allow our society to fall into the days of the 1930s where people were afraid to speak up for fear of losing a hard won job & the werewithall to support their families. Workers with mortgages, children in school are being directly threatened into silence in the quest for a so called strong economy.

Take care Australia, the cost of freedom is high.

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