Johannesburg - African bank announced on Thursday that it has decided to discontinue the Section 189A consultation process because of the response it has received to its offer of voluntary severance and retirement packages, which are enough to stave off planned retrenchments.
The bank said that it had reached the agreement with the South African Society of Bank Officials (Sasbo), the union that is representing workers who were to be retrenched. The mediation consultation entailed offering voluntary severance and retirement packages to staff.
In a bid to cut costs the African Bank in May issued notices to its staff about its restructuring plan that would have seen as many as 652 employees retrenched - about a sixth of the staff complement of 4075.
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However, on Thursday African Bank chief executive, Brian Riley, said as a result of the high number of workers accepting voluntary severance and retirement packages, the bank no longer needed to continue with the retrenchment phase. “The necessary reduction in staff numbers to achieve the appropriate cost base will be concluded through a voluntary process,” Riley said.
“Given this, we are pleased that we are able to avoid retrenchments. This outcome enables us to continue building a sustainable business over the long term.”