Habib Bank Limited (HBL) has announced 'Voluntary Separation Scheme' (VSS) for its 2,350 non-clerical staff, according to which the optees would be able to get alternative employment opportunities.
Sources told Business Recorder that VSS is a unique plan as for the first time in Pakistan any organisation is offering alternative employment opportunities along with VSS.
After the privatisation, HBL is moving ahead with building up its professional capabilities, focusing on core banking activities and enhancing its customer service and products. Consequently, as a broad based strategy, the bank is moving out of non-core activities through process of outsourcing many routine support services.
Normally, such services are outsourced to independent service providers operating on market parameters of compensation.
However, HBL has been setting a new concept for future lay-off and catering unemployment by using 'Independent Service Provider Companies' where employees would be provided opportunity to establish their ownership through allocation of shares, giving them the ability to benefit from the dividend income of these companies in addition to their salaries.
This facility of ownership would be offered to employees who opt under the announced 'Voluntary Separation Plan'.
The bank will bear the cost of shares and employees will thereafter own the companies where they work. Through this initiative, it is hoped that there will also be a significant change in the work culture where quality of service will enhance and opportunities for career development for good workers would significantly increase.
It is also expected that with the new concept providing continued employment opportunity along with VSS, employees will be participating in the plan with greater motivation.
The service provider companies as a special case will be offering better than market compensation only for the HBL employees who opt for the VSS.
Since privatisation last year, HBL has embarked on many business initiatives including acquisition of modern technology, launching of new products and developing culture of customer focus.
According to VSS, to all non-clerical staff, including drivers, security guards and messengers, who are in the employment of the bank as on December 31, 2005, irrespective of length of service, the bank would provide alternative employment opportunity in which a three-year guaranteed contract, consolidated salaries higher than average market rates, other benefits including medical insurance, uniform & shoes, group insurance, social security, annual leave and other leaves on accordance with the law would be available.
Financial returns: Optees whose total financial benefits would be less than Rs 500,000 after deduction of all liabilities will be paid the deficient amount.
Shares holding: The bank has acquired majority shares in Excellent Security (Pvt.) Limited (ESL) and Collateral Services Limited (CSL). There are about 940 security guards and 1410 other non-clerical employees. The number of majority shares in ESL and CSL shall be respectively divided by 940 and 1410 and the number of shares thus arrived at shall be transferred to each respective opting employees.
Additional benefits: The bank will give ex gratia, which will be an additional amount above compensation. In order to encourage and motivate to take maximum benefit from this scheme, the bank has decided to offer Ex-gratia in addition to other benefits.
The VSS will be valid till December 19.
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