State Bank, Employees Reach Accord

Bacha Gina, Commercial Bank President, announced deal to staff

The management of Commercial Bank of Ethiopia and the 29,000 employee association members reached an accord over salary adjustments and a proposed restructuring.

The recently appointed bank president, Bacha Gina, in a July 26, 2018 letter announced the agreement to the staff.

While the bank’s board agreed on the proposal to adjust salaries, the human resources department of the bank is charged with looking into the restructuring that accompanies the reshuffling of employees. Responses to the complaints will begin to be given in the coming week.

“As the management of the bank is working tirelessly to address the grievances, I encourage employees to kindly and responsibly perform their duties,” said the president in his statement.

The labour union, which started with just 500 members, and the bank management came to this agreement after a discussion meeting of the member of the labour union took place last Saturday at Exhibition Centre in Mesqel Square. It is reported that over 3,500 members of the labour union attended the meeting.

“The discussion was aimed at informing members of the progress of the case and to gauge how many of them were closely following the dispute,” Olani Seketa, vice-president of the labour union, said.

The issues came to the forefront after the bank’s restructuring plan, prepared two years ago by Frankfurt School of Finance & Management, was initially starting to be implemented two months ago at the managerial level.

Over half of the labour union’s members lodged complaints against the implementation of the restructuring program, claiming that it does not consider benefits, salaries and positions of employees.

“We’re not paid fairly when we work overtime, especially on Saturdays. The total compensation for our overtime work does not exceed 60 Br,” Jigsaw Binegde, branch control officer at the bank, said.

The employees say that they have been promised salary raises for the past two years by the bank.

“We have worked with all the capacity we have to provide good services in the hope that we’ll be compensated fairly someday,” said Yonatan Million, a clerk at one of the bank’s Megenagna branches.

Employees that attended the meeting told Fortunethat the restructuring might not go forward, which is not a sentiment shared by the bank’s president.

“All we are asking for is that members’ questions are answered.  As long as we have that we have nothing against the bank,” Olani told Fortune. “Our primary objection is the reshuffling of employees, which should be conducted in accordance with the deal that the bank agreed with the union.”

The original agreement between the bank and the labour union was signed in 1973 and amended about five years ago. The amendment provides employees with financial support in cases of deaths in the family, overseas medical treatments and dismissals.

Employees of the bank have gone on strikes three times in the past with the first one being in 1957 and lasting nine days. That was followed by a four-day strike a year later and a 12-day strike in 1976.

Eight years ago, the union gave support to 23 employees who were let go after the implementation of the so called Business Process Re-engineering just prior to their eligibility for pension benefits. The discharged employees received a total of 370,000 Br from the union.

For sustainable productivity, employees and companies must fulfill their obligations towards each other, which demands the application of peaceful negotiations prior to taking the case to court, according to Mehari Redai (PhD), a lecturer at Addis Abeba University’s (AAU) School of Law.

“It is preferable for business and employers to refrain from strikes and lockouts,” he said.

Commercial Bank of Ethiopia is the largest and oldest bank in the industry. Employing close to 33,000 people, it has received 71.5 billion Br in deposits and disbursed 63.7 billion Br in loans in the first three-quarters of the just-ended fiscal year. Its capital stood above half a trillion Birr, as of the end of 2016/17 fiscal year.

Belhu Takele, communications manager of the bank, did not respond to enquiries made by Fortune.


Published on Jul 28,2018 [ Vol 19 ,No 952]



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