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Co-op workers may get second post-crisis golden handshake

 

Co-op workers who previously benefited from early retirement schemes offered by other banks in recent years may also opt to participate in the current scheme, allowing them to receive a second lot of compensation, two banking sources said on Monday.

A banking source familiar with the matter said that up to 15 workers out of the around 2,700 workers at the Cyprus Co-operative Bank had previously benefited from schemes offered by other lenders such as Bank of Cyprus, Hellenic Bank, Cyprus Popular Bank, where they had worked before joining the Co-op.

These banks had reduced their staff levels in the years following the 2013 banking crisis and offered voluntary retirement packages of up €200,000 in cash tax-free.

The banking source said that while the Co-op’s scheme would also be exempted from income tax, in the case of those who had benefited from similar schemes in the past, the compensation from the state-owned Co-op would be taxed.

The Co-op which agreed to sell its operations to Hellenic Bank last month after its failure to reduce its non-performing loans stock practically forced it out of business, told its workers that it would allow up to 900 of them to participate in the scheme which provides compensations of up to €170,000 and not less than €20,000.

The offer has not been accepted by the unions which want to see the maximum compensation raised to €200,000 and the minimum to €100,000 and resemble schemes recently offered by other banks.

Savvas Toulloupos, who represents Peo members working for the Co-op, said that his union had proposed that the scheme should also favour workers employed by the bank for more than five years, compared to those who joined it in 2013 or later.

He added that as time passes, chances of avoiding labour action are decreasing. With the government not signalling so far its willingness to engage in talks, three unions will decide on Wednesday on the type of labour action to take.

“We will not accept unilateral steps,” he said in a telephone interview. “Our reaction will be immediate and dynamic.”

Toulloupos signalled that his organisation as well as Sek and Pasydy were ready to engage in dialogue with the government should the latter signal that it was ready to compromise.

On Friday, government spokesman Prodromos Prodromou said that if the unions decide not to accept the scheme offered by the Co-op, affected workers will be declared redundant, earning them one third of what the scheme offers.

On Thursday, a meeting of the three unions and the banking union Etyk with the management of the Co-op failed to produce results. Etyk, known for its harsh rhetoric, said that it was ready to strike.

Around 1,100 Co-op workers will continue working for Hellenic Bank while the rest will remain employed in the legacy Co-op which will be administering €7bn in non-performing loans that will come under the direct ownership of the government.

 

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