The on-going salary cuts ravaging across several sectors of the Nigerian economy have spread to the doors of the banking industry with Access Bank Plc announcing a salary cut for its staff as the COVID-19 lockdown bites deep into the country’s economy.
The Group Managing Director of Access Bank, Herbert Wigwe, had in a virtual meeting meeting, tagged Employee Town Hall Meeting, with some staff of the bank via Microsoft’s Teams (video) informed them of some strategic moves that the financial institution would take this month to ensure it weathered the ravaging effects of the present crisis shaking the world.
According to him, the decision would affect the bank’s 5,870 permanent staff starting with him, as his salary would be cut by 40%. He gave staff the options of either downsizing or accepting cut salaries. Majority of the staff present at the online video meeting on Microsoft Teams chose the lesser evil of cutting salaries.
After this, he had another meeting with staff via the same Teams where he finally announced that there will be salary cuts.
“One thing that has come out from the lockdown is that digital is the way forward. We do not need the complement of staff to take us to where we are going. It has also shown that non-essential staff, particularly from the outsourced staff, may not be at the level that we require to be in the future.
“We do not need all the security personnel, cleaners, tellers among others that we have now, considering the fact that not all our branches would be open between now and December. We will talk to the employers of that number of staff, which represent about 75% of our staff strength, to rationalize to the level we think would make us a customer-oriented financial institution that we are.
Access Bank acquired rival Diamond Bank Plc last year and that partly contributed to a 31% increase in operating expenses. Personnel, recruitment, and training costs account for more than a third of overheads after the deal boosted employee numbers and resulted in “wage harmonization” across the businesses. As at December 2019, Access Bank’s personnel cost was about N76.9 billion, up from N57.1 billion same period in 2018. The spike was mostly due to the merger with Diamond Bank where it also absorbed legacy Diamond Bank staff.