Again, massive retrenchment looms in MTN, Sterling Bank, others as recession bites...

Again, massive retrenchment looms in MTN, Sterling Bank, others as recession bites harder

  • Blue chip firms slash salaries by 40% 
  • We’re being disengaged without benefits – Workers 
  • Staff evaluation inevitable – Companies

As the nation’s economic fortunes continue to sag and with several companies struggling to reduce overhead in order to survive or remain profitable, more Nigerians are now at risk of losing their means of livelihood – their jobs.
Painstaking investigations by The Point reveal that many companies have resorted to massive lay-off of staff to cut down drastically on their wage bills in the face of dwindling incomes and low customer patronage.
The imminent job losses are to cut across such sectors of the economy as telecommunications, manufacturing, financial services providers, drinks and beverage production and the media.
Some of the companies to be affected by the impending massive retrenchment, according to impeccable sources, include blue chip companies like MTN Nigeria, Friesland Campina Plc, makers of Peak Milk and Three Crown milk; Nigeria Breweries Plc, Sterling Bank, Diamond Bank, First City Monument Bank, Skye Bank, and two leading newspaper organisations owned by top politicians, among others.
This is coming on the heels of sprinkles of retrenchments that have been carried out already by a reasonable number of private companies across the country and which, at the last count, had led to about 2,000 workers being thrown into the labour market in the last one month.
Further investigations revealed that for some other firms which did not want to disengage any of their staff, the employees have had to take huge pay cuts to retain their jobs, just as more companies were considering the salary slash option.
Some of the affected employees of some banks, who spoke with The Point, disclosed that their salaries had been reduced by as much as 40 per cent, and in some cases, 50 per cent.
More disheartening, however, is the revelation that in adopting different downsizing strategies, many firms have adopted different policies that contradict the labour laws in Nigeria.
A good number of the firms in question, our findings revealed, slashed their staff salaries by 40 per cent and then transferred the affected staff members out of their primary duty location to other states of the federation, without additional provisions for the staff to resettle in the new location, in an apparent attempt to force the affected to voluntarily quit their jobs.
One respondent, who told The Point his story, with eyes laden with tears, said that after his salary was reduced by as much as 40 per cent, he later received a letter of transfer to Akure, Ondo State from Lagos, without housing allowance and other labour-approved benefits.
Probing across various sectors, The Point was told heart-rending stories of victims of the sack gale, who were either asked to stay off work with immediate effect without severance pay or who had their earned terminal benefits slashed by 50 per cent or more by their employers.

In MTN, for instance, most of the disengaged workers were carried over from Visafone, which was acquired by the telecommunication firm. And their lamentations have known no bounds. One of them told The Point that when in 2015 the company came under MTN, their offer letters had indicated that in the event that the firm decided to disengage them, the company would pay one month salary in lieu of notice.
“Now, what each of us got from the company is almost half of a month’s salary in utter disregard for the initial agreement. We were told that the company had since reviewed the policy. But that was not to our knowledge. 50 of us were sacked around Ikeja alone and the few that were not affected got their salaries slashed from N120,000 to N40,000 before they were transferred from Lagos to Ondo, all in an attempt to get rid of them,” one of the victims said.
In the case of Friesland Campina Plc, the manufacturer of Peak milk and Three Crown milk, the sacked workers are still in shock. When the management summoned all Heads of Departments to its head office in Ogba a few weeks ago, a lot of them did not know the intention of the board. They were, however, stunned when they were informed that about 400 workers had to go as their termination of appointment letters had been handed over to the HODs.

“What each of us got from the company is almost half of a month’s salary in utter disregard for the initial agreement. We were told that the company had since reviewed the policy. 50 of us were sacked around Ikeja alone and the few that were not affected got their salaries slashed from N120, 000 to N40, 000 before they were transferred from Lagos to Ondo”

“Though, I was paid all entitlements, but the approach taken by the supposedly multinational firm was embarrassing and unethical. Laying off staff that had contributed their quota to the growth of the company during economic recession, when workers were finding it difficult to make ends meet, is unfair. Most of us knew the state of the company when we came in and how far it has gone now,” a former senior staff of the company told our correspondent.
Yet, a top source in the Human Resource department of the dairy firm told The Point that about 300 workers would still be shown the exit door.
“We found that if we don’t cut overhead cost and other excesses, we might close operations. All affected staff would be properly taken care of without bias,” he explained.
But the current wave of sack is not limited to MTN and Friesland. In NB, the biggest brewery firm in the country, no fewer than 100 members of staff lost their jobs between August and October 2016. Of that number, about 25 were of the rank of senior staff that had been in the company for over a decade.
“I didn’t know what was happening but just observed that some of my colleagues were chatting discreetly and were unnecessarily friendly. I knew that was strange but did not imagine I was going to be sacked. My HOD had received my letter a day before but failed to give me because he had told me to design some software to aid our work. He waited till I submitted the assignment before handing the letter to me. I had served the company with all my strength and was sacked on the day my wife delivered a set of twins,” one of the affected staff lamented.
The banking sector is also affected by the gale. In Sterling Bank, no fewer than 40 workers were sacked in the last one month. About 10 of them were senior bankers in the Information and Technology department, especially in Abuja and other northern cities.
An ex-IT staff told his story: “Contrary to the conventional inability of the dismissed staff to access the internal network when they resume in the morning, the bank had restrategised. Most of us were allowed to work normally for the day before we were handed dismissal letters around 5pm. I did not see it coming.
“All I can remember is that I was given an assistant, who I was told to groom as an IT expert. But I became suspicious when my boss did not invite me for a crucial meeting. The pathetic issue was that my entitlements were slashed and nobody bothered to give me reasons why that happened.”
But for Sterling Bank, there is yet more to come. The financial institution, another source told The Point, is considering slashing the ‘take home’ of its workers by 30 per cent.
A top executive of the bank disclosed that though the pay cut had not been approved by the board, there were indications that the policy would see the light of the day. “The bank is facing a lot of difficulties that have forced it to cut costs. The bank had stopped paying the salaries and allowances of drivers and domestic staff of top managers.
For Skye Bank, between August and September 2016 alone, several branches were shut and about 350 workers were sacked. Some of them claimed the decision was taken in order to ensure that there was enough to balance the bank’s books after spending so much on top executives.
“We saw more profligacy in Skye Bank than what the Central Bank of Nigeria said happened with the former management of the financial institution. Why would a bank, for instance, be more interested in closing branches, disengaging staff across the country all in the name of cutting cost, yet some of the members of the new management have increased their allowances a few weeks after resumption?” one of the disengaged workers of Skye Bank around Ketu, Lagos State, lamented.
According to the sacked workers, the management of the banks had transferred monies from the Visa cards and Mastercards of the affected staff to their current accounts to offset their liabilities to the bank.
What that means, according to them, is that those who had taken loans from the bank and have yet to liquidate the loans will have the money in their current accounts wiped out as soon as money hits the account.

Contrary to the arguments of some critics that the Association of Senior Staff of Banks, Insurance and Financial Institutions had failed to defend the aggrieved workers, the management of ASSBIFI disclosed that in most cases, the group was not carried along by the internal union in the banks when some of their members were disengaged.
On some of the confirmed cases of malpractices, the National President, ASSBIFI, Mr. Sunday Salako, hinted that the association was holding talks with some of the banks.
“We are working on Skye and Sterling banks. If we are carried along, we will negotiate and ensure that favourable conclusions are reached. We are still meeting them and hoping that the management will follow due process,” he said.

“All I can remember is that I was given an assistant, who I was told to groom as an IT expert. But I became suspicious when my boss did not invite me for a crucial meeting. The pathetic issue was that my entitlements were slashed and nobody bothered to give me reasons why that happened”

In all, what appears to be a new wave of sack gale in the banking and manufacturing sectors is not an isolated case. Economic experts projected that there would be more job losses across other sectors before the end of the year.
For the banks, one of the reasons is the fact that the apex bank has put some measures in place to tighten their operations and make it more difficult for top executives to live large. captureFor instance, the revised bank charges issued by the CBN in 2013 and recent sanctions of some banks to reverse illegal deductions made from customers’ accounts will certainly have an impact on the rate depositors’ are fleeced.
Speaking on the issue, the Managing Partner, Nesbet Consult and a fellow of the Chartered Institute of Bankers, Dr.
Alaba Olusemore, blamed the banks for their predicaments.
He explained that most banks had not been creative in terms of mobilising deposits from small depositors and SMEs, which should serve as the engine of the economy.
According to him, a lot of money could be tapped from that part of the system. “Rather, they (banks) leave it to cooperative and thrift societies and daily savings. Many of them don’t take it to the bank. There is a lot of money outside the banking system and that side has been neglected,” he observed.
He further pointed out that the International Finance Corporation/World Bank’s directive on financial inclusion mandates banks to aim at bringing the vulnerable sector of the society like the SMEs and the women into the financial system before they can access funds from international banks.
For the real sector, the experts blamed the apex bank and Federal Government for the ailing state of the companies and the economy at large. To the Director-General, West African Institute for Financial and Economic Management, Prof. Akpan Ekpo, the Federal Government is responsible for the job losses witnessed in the country.
He said, “On the supply side, we have structural problems because power supply remains epileptic, the road network is in bad shape and to make matters worse, the foreign exchange market is in disarray.
“If these factors are not in place, the manufacturing sector would keep downsizing. Putting all these together, the administration has not performed up to expectation and I expect more companies to sack more workers and the economy might collapse before the end of the year and beyond.”

However, the Assistant Secretary, Nigeria Labour Congress, Comrade Denja Yaqub, told The Point that the labour system in Nigeria was very weak, adding that companies like MTN Nigeria had been taking advantage of the porosity to perpetuate modern casualisation on Nigerian workers.
He said the congress had many running legal battles against the company and that it was presently consulting with the National Union of Postal and Telecommunication Employees on how to protect the interest of the Telco workers, either on contract or full time.

Curiously, the banks and some of the companies mentioned above denied that there were plans to sack workers, stating rather that what happened was that a performance appraisal was conducted for staff and those that did not perform up to expectation saw the handwriting on the wall and resigned voluntarily.
In his reaction, the spokesperson of Sterling Bank, Mr. Ayo Asaolu, said that, though it was normal in any corporate organisation to carry out such exercises in order to review employees’ performance of assigned duties and responsibilities, the bank had no plans to disengage staff.
On his part, the spokesperson for Diamond Bank, Mr. Ikechukwu Omeife, said the bank was strong, adding that its overhead cost and capital-adequacy ratio are within the industry regulatory threshold.
However, efforts to get a reaction from the General Manager, Corporate Affairs, MTN, Ms. Funmilayo Onajide, were abortive as she failed to respond to the calls and messages sent by our correspondent.
But a top source at the telecommunication firm told The Point that most of the affected staff were the ones in the call centre unit, which had been outsourced to an independent firm.
The source said, “The company cannot afford to retain such unit because the overhead cost was becoming unbearable, especially as it had been facing difficult times. It must be the independent firm that dismissed the staff and we cannot interfere in such development.”