[ad_1]
African Bank says it has been forced to restructure its business following the outbreak of Covid-19, the current state of South Africa’s economy, and its move towards a digital platform, likely to lead to job losses.
1,269 employees out of the current 3,728 total are anticipated to be affected, the bank said, adding that it anticipates a job loss rate of about 25% of the number affected.
The bank said in a statement on Tuesday (October 27) that it has begun a consultation process with its recognized union, Sasbo, as prescribed under the terms of section 189 (3) read in conjunction with section 189A of the Relations Act. Labor Law 66 of 1995.
“The Covid-19 outbreak and the associated prolonged lockdown intensified the dire state of the economy. Given the financial pressure our clients face, the Bank has recorded a reduction in both sales and collections, which has generated excess capacity in the different business units.
“Additionally, the bank has gradually automated processes across our operations and implemented the omnichannel digital platform to reduce duplication and increase efficiency. As a result, this has led to layoffs and forced the Bank to assess its current resource capacity, which may require reducing duplication of functions.
African Bank said it has continuously implemented several initiatives to reduce costs and align its operating model to the cost base, in line with economic reality, to ensure business sustainability and remain competitive.
“Therefore, it has become imperative to restructure the bank and therefore initiate consultations, which can lead to job losses,” he said.
African Bank CEO Basani Maluleke said: “We have been deliberate in reducing costs in all areas of our business. Conducting a consultation process with our employees is the last resort to further reduce costs. Our intention throughout the process will be to consider the appropriate measures to avoid and minimize possible layoffs.
“During these unsettling times, we will continue to provide the exceptional service our customers have grown accustomed to.”
African Bank and Sasbo have currently agreed to a facilitation process for the Commission for Conciliation, Mediation and Arbitration (CCMA) to consult on all relevant issues.
Read: These charts show how a contracting economy hurts South African banks
[ad_2]
