Editor's note: Four days after publication of this story, SunTrust eliminated the contentious severance clause cited by laid-off IT workers.
SunTrust Banks in Atlanta is laying off about 100 IT employees as it moves work offshore. But this layoff is unusual for what the employer is asking of its soon-to-be displaced workers: SunTrust's severance agreement requires terminated employees to remain available for two years to provide help if needed, including in-person assistance, and to do so without compensation.
Many of the affected IT employees, who are now training their replacements, have years of experience and provide the highest levels of technical support. The proof of their ability may be in the severance requirement, which gives the bank a way to tap their expertise long after their departure.
The bank's severance deal includes a "continuing cooperation" clause for a period of two years, where the employee agrees to "make myself reasonably available" to SunTrust "regarding matters in which I have been involved in the course of my employment with SunTrust and/or about which I have knowledge as a result of my employment at SunTrust."
The employees were informed of their layoff at the end of September, and the last day of work for some is Nov. 1. This is according to several of the affected employees, who requested anonymity for fear of retaliation.
The severance is seen by affected employees as a requirement to provide ongoing technical assistance as needed. The severance agreement itself says that this assistance from former employees "will be requested at such times and in such a manner so as to not unreasonably interfere with my subsequent employment." An employee shared the severance clause with Computerworld.
This assistance can be by telephone or in-person meetings, and it may be provided without "additional consideration or compensation of any kind," the clause says.
"How do they think this is acceptable?" said one affected IT worker about the clause. He said he couldn't fathom how the bank can cut its IT staff and yet insist that former workers be available to fix problems.
SunTrust, with about $189 billion in assets, declined to discuss the severance deal, and a spokesman said the company isn't commenting on its "HR policies or procedures."
Bank employees provided the estimate of the number of workers affected by the layoff. The bank declined to provide any specifics. The bank's only comment was general: "We are constantly reviewing and adjusting our staffing -- hiring in some areas while reducing in others." The goal is "to ensure we're meeting client needs effectively and efficiently," said a spokesman, in an email statement.
Sara Blackwell, a Florida attorney who is representing Disney workers in a discrimination complaint after they were replaced by foreign workers, said the SunTrust "contract requires them to be on call for two years, and they agree to not be paid for any time used to assist the company."
However, if the company called them and did not pay them, that would be "a clear violation of the Fair Labor Standards Act," she said. That law establishes wage standards. There may be exceptions for participation in certain aspects of litigation, but Blackwell said, "this clause is too broad" and is likely unenforceable.
Cooperation agreements are uncommon for midlevel employees; they typically apply only to C-Level executives, such as CFOs and CEOs, and then usually when there is ongoing litigation, said several attorneys who handle these types of agreements. The SunTrust severance also requires the laid-off workers be available for depositions, hearings and other proceedings.
Bryan Sullivan, partner at law firm Early Sullivan Wright Gizer & McRae, said cooperation agreements are usually for highly paid executives. When consulting expertise is required, there may be a separate consulting contract as part of the severance, he said.
SunTrust has been working for a number of years with IT contractors -- including IBM and Infosys -- that have large operations in India and other foreign countries, said bank employees. Employees said the "knowledge transfer" -- the euphemism used to describe training contractors who are taking their jobs -- is well underway and is being done both over the Web and in person.
SunTrust employees said they were told to cooperate with whatever the "vendor partners" asked. The vendors have access to employee systems and are shadowing them in their day-to-day work.
Contractors with H-1B visas are also being used at the work site, according to Labor Condition Application filings, which attest to wage levels and work site locations.
SunTrust workers have been filing Trade Adjustment Assistance (TAA) applications for several years, citing a shift of work to India or jobs lost as a result of foreign outsourcing. TAA provides displaced workers with certain benefits, such as help with college tuition.
The SunTrust employees could not say exactly how big of a role outsourcing contractors are now playing at the bank because they don't know the bigger picture. But they did observe that in IT offices many of the workers appeared to be from India or other countries in that part of the globe.
Editor's note: Computerworld asked for comment on this story before publication, and SunTrust declined. The bank then issued this statement at around 11:30 AM on Tuesday, Oct. 20, from Mike McCoy, who works in bank PR:
The headline and premise of your story: "Bank’s severance deal requires IT workers to be on call for two years" is misleading. We do not require former employees to be "on call" as implied. We respectfully request a change to the headline and a clarification of our practice.
It is a rare occasion when we need to call a former employee. The “continuing cooperation” clause is designed to assist the company under scenarios that arise infrequently when we need access to knowledge possessed by a former employee. Those scenarios primarily relate to regulatory or legal matters. For instance, we may need to reach out to former employees to ensure we accurately understand situations in which they were involved while employed by the company. SunTrust has never used this provision to require a former employee to be “on call” to help conduct day-to-day business in any way.
This story, "Bank’s severance deal requires IT workers to be on call for two years" was originally published by Computerworld.