The Bank of America Corp. laid off an unspecified number of workers last Wednesday at Fleet Bank branches, a Boston-based spokeswoman said, but the number was “significantly less” than a 1,500 estimate published in a Boston newspaper.
“I do not have an exact number for you,” said the bank’s Alison Gibbs. “I can tell you that the associates who were impacted are receiving a very attractive severance package, 17 to 48 weeks of pay, depending on how long they’ve been with the bank.”
Gibbs added that the layoffs are part of Bank of America’s conversion of Fleet branches to its “banking center” model, which has a different staffing setup. “They have had a lot of success with this model, and you can imagine, with banking centers all over the country, that it’s important to get consistency among all of the centers.”
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The cuts are part of the 12,500 jobs that Bank of America had predicted would be lost companywide due to the merger, Gibbs said. Their impact will not be uniform, she said – some branches will actually gain employees. And in the long run, “I can tell you that we continue to be committed to maintaining job levels in this region.”
But assurances or not, key local officials were fuming.
“It’s outrageous behavior on their part,” said Massachusetts state Rep. John Quinn, a Dartmouth Democrat and chair of the Joint Committee on Banks and Banking. “It hardly strikes me as how to treat your employees, or how to make your first big splash in the region.”
At a merger hearing in January, Bank of America had said it would sacrifice no more than 500 local jobs, Quinn said, and most of those would be to reduce redundancy within the new bank. They were to be all back-office positions. “They said that all ‘customer-facing’ – that means bank tellers – positions would be retained,” Quinn said.
Rhode Island state Rep. Brian P. Kennedy, a Hopkinton Democrat and chair of the House Corporations Committee, which oversees banks, said the layoffs were so sudden, “it’s like waking up and having someone pour cold water on you.”
Earlier this year, Kennedy added, a Fleet lobbyist had asked legislators, almost as an afterthought, if they’d be willing to ease a rule on job-creation tax credits so the bank wouldn’t lose its credits if its employment levels fluctuated during the transition.
But bank officials said “they were going to do their best to try to keep layoffs in Rhode Island to a minimum, recognizing the rich history of Fleet Bank here,” he said. “At least it seemed to indicate to us they were going to give us some notice, so perhaps the state could even prepare job fairs or something. … They really haven’t followed through on the promises and assurances they provided, and that’s a big disappointment.”
Gibbs said the Fleet employees who lost their jobs had all been told Wednesday, with the layoffs effective immediately. It was better that way, she said, because “you can imagine if you’re told that your position has been eliminated, you may not feel comfortable sticking around doing your job for the rest of the day. It’s out of consideration for these impacted associates and also for the customers.”
As for earlier predictions that branch jobs would be safe, Gibbs said because there was no overlap in the Fleet and Bank of America retail footprints, “We didn’t anticipate impact in the branches.” But while no branch closures are planned, Fleet did have a “different model” that needed to be realigned with Bank of America. “It’s for consistency and efficiency,” she said. There are 50 branches in Rhode Island.
A Boston Globe report quoted a set of talking points that branch managers were supposed to use if asked why “customer-facing” jobs were being cut after all. The bank’s answer, the Globe reported, didn’t refute that initial prediction, but went on to talk about the need for “optimal staffing levels” necessary to provide “customer delight” at Fleet.
Raymond Filippone, associate director for unemployment insurance at the Rhode Island Department of Labor and Training, said his office had been “sort of aware” of possible Fleet layoffs since April, when it contacted a Fleet human resources official and was told about 60 Rhode Islanders might lose their jobs as a result of the merger.
But “there was nothing definite about that number,” Filippone said, and the bank did not provide specifics. His office received no advance notice of last week’s layoffs, he said, and efforts by his staff to reach bank officials Wednesday – so they could expedite unemployment benefits and other services to the workers – were unsuccessful.
Massachusetts Rep. Quinn said any Bank of America layoffs right now would be particularly badly timed for the New Bedford area, which is already going to lose 360 bank jobs due to Sovereign Bank’s acquisition of Compass Bank.
In Rhode Island, Rep. Kennedy said he wasn’t sure he could still trust Bank of America officials’ assurances that staffing levels would bounce back.
“I hope to God that the number of layoffs that they’re announcing, that that’s it, that we’re not going to go even further, but right now, I’m not necessarily convinced that this giant financial behemoth is acting in good faith on anything,” Kennedy said. “Savings is the bottom line for them, and it appears to me that they’ll do whatever it takes to prop up the earnings of the bank, notwithstanding what it does to the work force.”
The layoffs may also hurt Bank of America’s long-term prospects for tax breaks, Kennedy said.
“I’m not necessarily convinced that any of us are willing to take a look at this and say OK, the whole purpose here is to just keep coming back to the well again and again and again with the bucket to get more tax credits, but in the end you’re going to keep doing this; you’re going to keep cutting jobs,” he said. “All the ads in the world that they run during the Olympic Games are not going to make up for what they’re doing.”
Bank of America announced earlier this year that employment in New England would remain flat, though some jobs might be cut and new ones added. Fleet employed about 47,000 people before the merger, including about 4,000 in Rhode Island.
In May, Bank of America notified Massachusetts officials that about 500 jobs would be cut in the Bay State within two years. No such notice has been given in Rhode Island. In July, in a conference call with analysts, Bank of America president and chief financial officer Marc Oken said the bank had already cut about 3,800 jobs as a result of the merger. The company expects cost savings from the merger to total as much as $750 million by the end of 2004, Oken said.
With reports by staff writer Laura Ricketson.
