SC First Bank, the local unit of the British banking group Standard Chartered, plans to accept the request of all 813 workers who applied for early retirement, the bank said Wednesday, cutting 13 percent its workforce as part of cost cutting reforms.
“We plan to accept all 813 applications for voluntary redundancy. They will work until the end of the month,” a spokeswoman at the bank said.
The bank started taking applications for voluntary redundancy from those who are aged 35 or more and have worked at the bank for over a decade. It has encouraged senior workers to take advantage of its redundancy payment worth 34 months of pay, offered on top of school expenses for up to two children per worker.
“Laying off 13 percent of their workforce will make their cost management more flexible, but it also faces challenges in its shift to a performance-based pay system from the current seniority-based one,” a banking sector analyst said.
The bank plans to drop the Korean name “Jeil,” or “First,” from its name starting next year as part of a broader reform. It also plans to introduce a performance-based pay system against stern opposition from the labor union, a push that would challenge the industry culture of paying workers based on experience and seniority. About half of its 6,500 workers went on strike for eight weeks with no pay in June to protest the lender’s proposed pay system.
By Cynthia J. Kim (
cynthiak@heraldcorp.com)
