Issue No.24 of 2009
Thursday 19 November

Executives get 36%, Workers 2% as Bank Executive Excess Continues

The CEOs of Australia’s biggest four banks enjoyed more than $35 million in remuneration last year, while offering workers increases well below inflation or, in the case of ANZ, just matching inflation.

One bank CEO’s raise alone is equivalent to more than 50 jobs sent off-shore.

Even as bank profits and dividends dropped, three of the four CEOs enjoyed raises.  And the one who didn’t was the highest paid—earning more than $10.9 million, or $20.81 every minute of every day.

ANZ’s Mike Smith earned $10.9 million;
Westpac’s Gail Kelly $10.6 million;
Commonwealth’s Ralph Norris $9.2 million; and
NAB’s Cameron Clyne $5.2 million.

At Westpac, the executive group’s fixed salaries rose by 36%.  Westpac employees were offered raises of 2%.

“Something is wrong when executives’ fixed salaries go up by 18 times those of workers,” said Leon Carter, National Secretary of the Finance Sector Union.  “It’s especially wrong as major banks continue to send jobs off-shore, and effectively deny many members pay increases by continually increasing sales targets.”

Mr Carter noted that Ms Kelly’s extra $2.7 million in remuneration this year is roughly equivalent to 54 back-office jobs sent abroad, each earning $50,000.

At NAB, Mr Clyne’s salary is 115 times as big as what an off-shored back-office employee would have made.

“It’s no wonder more people are looking to the FSU to increase their clout.  They see CEO salaries going up, while good jobs are sent abroad in the name of savings,” he said.

Executives other than the CEO also enjoyed large increases.

At ANZ, three of four executives around last year saw salaries go up.  Westpac had three executive members with double-digit increases, including one with a 47 per cent rise.  NAB’s executive had three more, and Commonwealth had five.

“It’s clear the increases enjoyed by the boardroom aren’t seen in finance workplaces,” said Mr Carter.  “But the FSU is making progress negotiating better wages, and more finance workers joining our union means we’ll make even more progress."

“We’re also working hard in Canberra as the Government reviews executive salaries.  Because eventually enough is enough for executives already making seven or eight figure salaries,” he said.

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Go Home On Time Day – Next Wednesday the 25th November 

New findings have revealed that Australian workers are gifting $72 billion in unpaid work to employers with a typical full time employee working an average 70 minutes of unpaid overtime a day.

The finance industry has a long track record of excessive hours and unpaid overtime, caused by understaffing, unrealistic workloads and a management culture that demands flexibility from employees but often fails to provide it in return.

FSU, along with many other organisations is supporting The Australia Institute’s Go Home On Time Day next Wednesday 25th. FSU members are asked to mark out their diaries next Wednesday, postpone last minute tasks, register their participation at and leave work on time.

Letters have been sent to all major employers requesting that they show how serious they are about addressing work/life balance by promoting the day to their employees and customers. 

 Read the FSU letter to employers and their responses here.

ME Bank have not only said they will promote and support the day but have gone an extra step. In an internal communiqué to staff, ME Bank have stated:

“We are proud to support the FSU in this initiative and to further demonstrate our commitment, would like to go the extra mile by providing all employees with a ‘Go Home Early Day’.

ME Bank employees will be offered later starts, longer lunch breaks or earlier knock offs on the day, throwing down the challenge to other finance sector employers about work/life balance and being an employer of choice.

ME Bank Acting CEO, Nick Vamvakas is quoted as saying “I encourage employees to be aware of the number of hours being worked and to ensure you are achieving balance in your work and home life.”

FSU congratulates ME Bank along with Industry Superfund Cbus and the Teachers Credit Union who had also agreed to support the day.

In the meantime, all members need to demonstrate how serious the issue of unpaid overtime, excessive workloads and understaffing is in your workplace by going home on time next Wednesday. It’s easy, non-threatening and good for you.

 Read The Australia Institute research here

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Industry Super Ramps-Up Attack on Commissions 

The Industry Super Network (ISN) is increasing pressure on the Government to end sales commissions for financial planners which it argues leaves them in a conflict of interest between providing advice that is best for consumers or advice that determines the size of the planner’s pay packet.

ISN teamed up with the ACTU, CHOICE, ACOSS and AIST to run full page ads in the Australian newspaper calling on members of the Parliamentary Joint Committee on Corporations and Financial Services to recommend the end of commissions when it reports on the Storm and Opes Prime collapses on Monday.

In an argument similar to FSU’s policy regarding performance pay and sales targets, ISN argues that decisive action by the Parliament will mean a boost to professionalism in the industry and greater consumer confidence.

FSU is meeting with the Financial Planners Association as well as major wealth management employers to discuss moving away from commissions and it’s implications for employees. Click here to read more

Meanwhile ISN is putting a spirited argument to the Cooper Review regarding Australia’s superannuation industry, its governance and its practices.

It’s hard to go past the compelling argument that industry and not-for-profit superfunds have got it right as proven by their far superior performance for members overtime. We await Mr. Cooper’s findings and recommendations with interest due out in December.

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Mutuals See Off GFC Storm – But More Consolidation Likely 

Credit Unions and Building Societies have weathered the Global Financial Crisis pretty well according a recent KPMG report.

While the report says that further mergers and consolidation is likely in the sector in order to attain competitive scale, the strength of relationship between mutual members and their finance provider has proved resilient.

FSU congratulates mutual employees and looks forward to working closer with the industry as we map a path for the banking sector that provides healthy competition to the big banks.

 Click here to read more

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Insurance Conditions at a Premium 

Penalty rates on weekends and public holidays, minimum 3 hours shifts for part–time and casual employees and loss of accident make up pay are some of the entitlements that will be substantially reduced or lost on 1 January when the Modern Finance and Banking Award replaces the Insurance Industry Award.

FSU has approached the major insurance industry employers seeking to protect threatened Award conditions by negotiating new Collective Agreements or to execute a deed to preserve these conditions.

So who’s in and who’s out? 

 Click here to read more.

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Zurich - 94% VOTE YES to New Agreement 

The ballot for the Zurich Australia Union Collective Agreement 2009 closed last night with 94% of people voting in favour.

 Click here to read more

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FSU in the News  

The FSU is your voice in the workplace, at the bargaining table, in Canberra, and in the national media. Here’s a couple of your union in the news in the last fortnight:

 Offshore support jobs float home
The Advertiser, 17 November

 Bank tellers forced to clean ATMs
The West Australian, 12 November

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Authorised by FSU Acting National Secretary Rod Masson