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Business News of Monday, 15 July 2019

Source: Myjoyonline.com

Former staff of Heritage Bank accuse Receiver of cheating them on exit package

Former staff of Heritage Bank have accused the Receiver, Mr Vish Ashiagbor of PricewaterhouseCoopers, of short-changing them on their exit package.

The aggrieved staff, in a press statement, say Mr Ashiagbor have set aside the condition of service of Heritage Bank and are appealing to President Addo Dankwa Akufo-Addo and the Finance Minister, Ken Ofori-Atta to step in.

They say they will be left with no option than to seek for a legal redress without an appropriate intervention as their human rights were being violated.

Key points in the release:

- On the 4th of January 2019, the Bank of Ghana announced the revocation of the banking license of the Heritage Bank Limited and concurrently approved a purchase and assumption agreement of selected assets and liabilities to the Consolidated Bank of Ghana Limited (CBG).

- Mr Vish Ashiagbor of PWC as the appointed receiver of the bank promptly terminated the employment contracts effective immediately and replaced same with three – months contracts expiring 31st March 2019. All benefits except health were effectively annulled.

- During the negotiation, Heritage Bank Limited (Heritage) Negotiation Team (HBLNT) was right at the inception of the negotiation to drum home the following:

1. Heritage was solvent as at the date of revocation of our license;

2. Consolidated Bank Ghana (CBG) took over selected assets and liabilities which meant that Heritage staff were not be absorbed into CBG;

3. Due to the general consolidations and collapse/closure of 11 banks chances of finding job within the industry are slim. Not to mention the collapse of the several service providers to the banks and the 384 microfinance institutions;

4. Most staff of Heritage, in view of the fact that the bank was licensed by the Bank of Ghana in October 2016 as Universal Bank had the confidence that the Bank was properly licensed to conduct banking activities and hence resigned from their otherwise stable jobs at other banks;

5. As part of the negotiations for compulsory redundancy, staff were engaged by the Receiver and presented their proposal which was in conformance with the Mandatory Redundancy Policy of Heritage.

- The proposal from staff included:

i. Two years total annual compensation (basic salaries + rent & clothing allowances)

ii. One year access to medical insurance for staff and their dependent

iii. Outstanding leave days to be commuted to cash

iv. 75% loan write-off.

v. Interest on loans to be frozen effective 1st April 2019.

vi. Staff to be given the first right of refusal to buy the bank's assets at 50% of NBV.

vii. Staff to be allowed to access their Provident Fund Contributions.

- That the proposal from staff has been ignored.

- That the redundancy policy of Heritage was instituted in February 2018 to prevent any adverse impact on staff due to a hostile takeover or merger arrangement at the time the Bank started to raise new equity capital.

- On 20th May 2019, an MOU was signed between the Receiver’s negotiator and some unauthorized members of Heritage Team in which major entitlements of the staff were largely ignored. It is interesting to note that details of this MOU were only leaked to staff by a source not close to the negotiation days after the signing.

- Due to unsatisfactory and somewhat scanty feedback from the Heritage Team throughout the negotiation process, a motion was tabled on 28th June 2019 to retire all members of the Heritage Team. Majority of ex-staff are of the mutual view that generally, expectations were not well managed to derive the best results and hence further actions be taken to ensure staff are properly compensated.

- As though these actions from both the Receiver and the former Heritage Team were not enough, the Receiver in a letter dated July 8, 2019, indicated that he will not honour the terms of the agreement of May 20, 2019, citing various excuses. It is interesting to note that the Receiver’s own representative (Austin Gamey) signed and agreed to the terms of the MOU as “binding on the parties”. The question is why is Mr Vish Ashiagbor not respecting the work of his own representative?

- It is thus clear that the Receiver has not recognized the negotiation process or the results thereof. We are therefore left with no choice than to take other steps in pursuing justice for all aggrieved staff of the erstwhile bank.

- Most staff of the erstwhile bank are home, unemployed and unable to take care of the many dependants who have been affected by this impasse since March 31, 2019.

- Staff are thus left with no option than to appeal to the President, the Finance Minister or to seek for a legal redress as their human rights were violated in the illegal withdrawal of their services in contravention of the laid down policies of the erstwhile bank.