Our View: Bank workers union needs to be told the party is over

The dispute between Hellenic Bank and the bank employees’ union Etyk over the renewal of the collective agreement seems set to drag on. In the latest twist, the union refused to engage in the start of the mediation procedure at the labour ministry, which it had sought, because the bank had refused to satisfy its demand to place all staff that came from the Coop Bank on the same pay as its existing workers.

The bank’s CEO Oliver Gatzke had taken the position that the issue would be resolved in the negotiations for the renewal of the collective agreement, which were deadlocked after two meetings last month with management claiming the differences were unbridgeable. Etyk has therefore decided to apply pressure by seek the increase of the wages of the ex-staff of the Co-op Bank as a condition for mediation, having secured the opinion of the ministry, which said Hellenic was in the wrong.

In Gatzke, it appears, that Etyk have found a formidable opponent who refuses to be intimidated either by the union’s bullying tactics or its use of the support of the pro-union labour ministry officials. Gatzke’s predecessor had also stood up to Etyk, but he left without being able to resolve anything with the union. What the union is fighting against is the CEO’s insistence that the bank’s viability depends on reducing its costs, 50 per cent of which goes on wages. He wants to cut the number of staff but is not prepared to pay the extortionate compensation for ‘voluntary retirement’ demanded by Etyk.

The Bank of Cyprus has been extremely generous with its voluntary retirement schemes and Etyk expects similar levels of compensation from Hellenic, which has no legal or moral obligation to follow suit. In fact, Hellenic could follow the law by giving out redundancy notices and allowing the state to compensate the workers from the redundancy fund. This will be a big cost to the state, but perhaps it needs to be done by one of the banks, if only to discourage the ministry of labour siding with Etyk, as a matter of policy and regardless of the merits of the dispute.

It would be fascinating to see how the finance and labour ministries would react to such a possibility. This may force the government to stop encouraging Etyk’s unreasonable demands, setting conditions for taking part in the mediation process it had asked for, after it had ensured pay negotiations ended in deadlock. We doubt the Hellenic board would sanction such a move, but it should at least be prepared from a strike, because there is no other way for it show Etyk that the party is over.