When discussing trade unions, images of miners and train drivers come to mind. Finance is not anybody’s first thought, but Unite has a dedicated trade union division for the finance industry with around 100,000 members. So why is it so rarely mentioned? Patrick Brusnahan investigates
In a general election year, unions are a buzzword. Strikes are prevalent already with three London bus strikes in February alone and one planned for NHS workers in Northern Ireland in the first week of the same month. With this level of strike action in the United Kingdom, why does the finance sector seem relatively quiet?
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One factor is the amount of membership in the financial sector’s union. With approximately 100,000 members, its membership pales in comparison to unions such as the National Union of Teachers and the general workers union GMB, with 388,000 and 613,400 members respectively.
Rob MacGregor, national officer for the finance sector at Unite, believes this to be a key issue. Talking to RBI, he said: "It’s been a perennial problem for the union. We reckon we’ve got around 15-20% of the industry, but, in the grand scheme of things, two out of every ten being a member of the union is not a position of strength. It has been a significant period of decline in trade union membership in general."
This leads to the question of why people are not joining the union. The problem could lie with morale. As the union seems to be overshadowed by the industry it is in, with a controversy prevalent since the financial crisis, workers could see there being no point in actually joining the union. MacGregor said: "The workforce is still very much shellshocked by the events of 2008. We work in an industry which was, on the face of it, relatively secure. We’ve had job losses and restructuring in the past. What happened in 2008 was borderline global economic Armageddon.
"We still have a situation where RBS owes the taxpayer £45bn. The Lloyds Banking Group is still 20% owned by the taxpayer. Even a relatively small bank like the old Northern Rock still owes the taxpayer around £22bn. It’s going to be a generation before the banks have repaid their debt to the UK taxpayer.
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By GlobalData"That all lends itself to the alienation of bank workers. The organisations that they work for were responsible for the financial crisis and they are tarnished by this sense of greed and arrogance. Banks are held in pretty low regards and that affects the workforces who have always been loyal to their employer."
The one-sided loyalty shown by bank workers to their respective organisations is a true concern to the union. One crucial aspect to this side is job security, or perhaps the lack of it. One example of this is the work of Lloyds Banking Group. In October 2014, Lloyds announced that, over the next three years, a tenth of its workforce (approximately 9,000 jobs) would be cut. Unite believes that 35,000 jobs at Lloyds have been affected since 2008. However, a lot of the redundancies have been voluntary.
MacGregor thinks that the case is slightly different. He said: "What the banks have been able to do is claim that, despite the fact that all the major banks have cut tens of thousands of their workforce, the vast majority of those have been voluntary redundancies as opposed to enforced or compulsory. A straight reading of their figures supports that, but what that doesn’t show is that, amongst the many of thousands of people who volunteered for redundancies, they have taken that view because they are pushed. They do not believe a suitable form of alternative employment is available.
"It’s systematic of a greater problem within the banks. Every time they call for voluntary redundancies, and it doesn’t matter which part of the bank or the country, they are always oversubscribed for volunteers. It might make things easier, but it tells us that people are desperate to leave. Surely that is a concern."
Why is everyone so eager to leave? The reputation of banks is an issue with many in the banking sector, from branch worker to CEO, tarred with the same brush and held responsible for the global financial crisis. A more immediate and pressing issue, however, is the issue of pay. More specifically: bonuses.
MacGregor said: "The salaries of banking clerks have never been fantastic. What has happened over the years is that banks have reduced the amount of performance-related pay and the guaranteed monthly income of working people in the bank has been pegged back over the years. People have worked for the organisation for a number of years and they’re earning around £15,000 a year and they need their bonuses. The bonuses that people get are now covering their bills due to low pay."
The issue regarding salaries has another level to it. While those towards the bottom of the ladder have struggled in the past seven years, these monetary problems do not reach those higher up. MacGregor agreed: "That’s one of the things we’ve been campaigning about for a number of years. When you look at the distribution of bonus payments and variable elements, it is very much geared towards the senior grades and certain disciplines. There’s a huge difference between a personal banker, who sells a mortgage in a branch getting £500 extra per quarter, to a bond trader earning £100,000 every time he completes a deal."
Will the situation change? MacGregor concluded: "I think it’s a long term cultural shift. These are not historic problems; these are ones that are still very present within the institutions. The jury’s still out on whether the industry has legitimised itself to the new reality. I’m deeply concerned that the current generation of chief executive that we have in all of the major financial institutions are still very much of the old school. These guys claim to bring about change, but their mentality is still ‘This is where we came from’".
