The announcement that the Royal Bank of Scotland and Lloyds TSB will cut over 2,000 financial services jobs has attracted a storm of criticism from trade unions and employees within the sector.
Lloyds TSB will shed over 1,600 staff within its operations, insurance and wholesale divisions as part of the restructuring of the banking group announced last year. RBS is due to cut up to 500 positions nationwide, including the closure of its operations in Bristol and Farnborough.
The unions have described the staff cuts as ‘brutal’ and called it a ‘black day’ for the financial services industry. There is particular anger as both institutions were recipients of government bailout money in the banking crisis of 2008. Anger was intensified by the fact that 300 of the Lloyds TSB jobs were being transferred to India to take advantage of lower labour costs.
Jointly, the organisations have been forced to reduce their workforce by over 50,000 since the financial crisis and both banks acknowledged the impact that the announcement would have on their staff. However, they claim the cuts are required by tough trading conditions and overall market uncertainty in the wake of the European financial crisis and the global economic slowdown. Management at both banks emphasised that compulsory redundancies would be kept to a minimum and strenuous efforts would be made to find new roles for those affected. Lloyds TSB claimed that of the total job cuts, fewer than 50% have resulted in compulsory redundancies.