Gale of sacks in the financial sector is worrisome; but threats of licence withdrawal is wrong
It was perhaps expected that the Federal Government will react sternly to the gale of job shedding in the financial services sector. With banks spurning its directive to halt the on-going industry-wide staff rationalisation, it threatened to revoke the licence of any bank that violated the order. In a note that sounded desperate, Minister of Labour, Chris Ngige, warned: “the Federal Government gave the licences to the banks to operate and if its directives are not adhered to, the licences will be withdrawn if the need arises”.
We consider the threat as not only unwarranted but smacks of an overkill.
Was the Federal Government right to be alarmed? The answer is, yes. What is debatable is whether it can claim such powers, particularly under a democracy whose bedrock is the rule of law, without being accused – rightly in our view – of acting arbitrarily.
That is not to suggest that the gale of retrenchment is nothing to worry about. Barely a month ago, it was First Bank which, through its parent company, FBN Holdings, announced that it planned to reduce the number of its workers by 1,000 to cut costs. Three other banks have since followed in quick succession: Diamond Bank – 200; Ecobank – 1,040; and Skye Bank 175 – all of these within the month. The common factor in all of the retrenchment is the claim of poor profitability and harsh economic situation.
The poor shape of the economy is of course beyond deniability. The point here is that the management of the banks, being private entities, are answerable to their shareholders and perhaps to a lesser degree, to the regulatory authorities. With their primary consideration being the bottom-line, it is expected that they will do anything – including sacrificing the workers – for a healthy bottom-line. Their case unfortunately finds some merit in the increasingly harsh operating environment and declining profitability recorded in the preceding year.
We must however not fail to point out another side to the argument. The first stems from their social responsibility as financial operators who derive their sustenance from the society. This requirement should ordinarily impose the burden on the banks to be socially sensitive and responsible – a burden which unfortunately, they have neither learnt nor shown disposition to bear. This obviously explains why the hapless workers are the first to go at the onset of the threat to the bottom-line; nothing about the fat and sometimes outsized compensations to their executives which, they are able to creatively hide from the prying eyes of tax authorities. Time in our view for the bank executives to do some soul-searching.
Of course, we know for a fact that most, if not all of these banks are not unionised, not to their own choosing but simply because their management would have none of it. As a consequence, the workers are not only rendered powerless but easy targets of arbitrary actions of the management. It seems to us about time the workers assert their right to have a say in the affairs of their institutions, in so far as it affects them.
No doubt, the government as the guarantor of the public good cannot be expected to keep mum in the face of the one-sided action of the banks’ management. This is even more so when many of these banks would have long gone under without government patronage. We expect the Bankers Committee to step in to stop the gale of sacks. At this time, it is the least it can do to halt a possible social cataclysm.
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