SunTrust Banks on Tuesday sought to knock down a trade publication report that it requires recently laid-off information technology workers to be “on call” for two years.
The Atlanta-based bank didn’t dispute that about 100 workers are being let go, but it said that under terms of their severance deal they will only be expected to provide very specialized information — not frequent consulting help.
“It is a rare occasion when we need to call a former employee,” the SunTrust statement said. “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, primarily related to regulatory or legal matters.”
The statement added: “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.”
Computerworld magazine’s website had reported Monday that the laid-off workers’ functions will be shifted to contractors – especially IBM and Infosys – who largely intended to carry out the work overseas or with workers temporarily in the United States.
The magazine had also reported that SunTrust workers were required to help train the contractors who would be taking their jobs. The report, which was subsequently reported in the AJC, cited information from unnamed affected workers.
Jonathan Segal, an attorney with the firm Duane Morris in Philadelphia who represents management, said executives leaving “high-level positions” are commonly required to be available afterwards to provide information that others would not have.
“There are times that a lower-level employee has institutional knowledge that is needed later. But it is the exception, not the rule,” said Segal, who is also legislative director of the Society for Human Resource Management in Pennsylvania. But a large group or entire division, “that would be unusual for it to be across the board.”
In general, employers should avoid severance terms that further upset those being laid off, Segal said. “What gets someone to a lawyer is often a question of, ‘I’m angry. I feel abused.’ And a lawyer can often find something on which to base a legal action.”
The AJC had over the past several weeks contacted SunTrust several times to ask about the story. The bank declined comment. On Tuesday, the bank issued a statement to the AJC and to Computerworld that implicitly confirmed the layoffs but took issue with the description of the severance package.
Other aspects of the severance deal, such as how much pay is provided, were not disclosed.
Last week, SunTrust reported a $537 million third quarter profit, down 7 percent from a year ago despite slightly higher revenue. The bank said that, excluding tax benefits that lifted the prior-year figure, the profit was up 20 percent.
In that report, SunTrust said it had 24,124 employees on Sept. 30, or 950 fewer than a year earlier.
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