With Bank of America (NYSE:BAC), cutbacks have become a part of its new normal, and CEO Brian Moynihan recently announced plans to lay off 16,000 workers by year's end. That strategy had me wondering about whether such a move is in the best interests of the company, and now there's more dire news on the job-reduction front: Worker cutbacks are now being applied to the bank's popular work-at-home program -- an arrangement that has allowed the bank to keep valuable employees on board while saving $6,000 annually on each worker.
Flex time is commonplace among large employers
According to the Winston-Salem Journal, Bank of America is taking another look at its flex time program, My Work, reportedly as part of Project New BAC. The bank is looking to reduce the number of employees involved in the program, looking at the issue on a department-by-department basis. Some employees may soon be required to come in to the workplace to perform their duties.
Thousands of employees would be affected, as over 15,000 workers nationwide take advantage of the arrangement. My Work involves not only telecommuting, but allows employees to work from other remote locations, as well.
B of A is one of many employers offering such an option. JPMorgan Chase (NYSE:JPM), for instance, has from 2,000 to 3,000 workers telecommuting each day -- a number that swelled to 25,000 on the Monday after Superstorm Sandy hit New York. Wells Fargo (NYSE:WFC) notes that its own program makes recruitment easier, produces happier and more productive employees, and saves both employees and the company money. Citigroup (NYSE:C) had been offering flex time for some time, and used the program to offer employees telecommuting jobs when it closed down its mortgage office in Frederick, Maryland two years ago.
Interestingly, recent research shows that allowing flex time makes employees more loyal, and willing to work longer hours. Not only that, but one study estimates that workers could save up to $650 billion each year if telecommuting was made more available -- extra cash that they could then put to use invigorating the economy.
One Fool's take
To me, the big question is: Why would Bank of America squelch a program that is saving it money? Since the initiative is part of the bank's cost-cutting program, it occurs to me that this may be a way to make some employees quit. There is another unsavory aspect apparent here. The Journal noted that the bank recently announced its plan to shut down its day care centers -- a move that makes it look as if the bank is targeting employees with children, particularly since My Work seems most popular with those workers who see it as an aid to balancing work and family concerns.
Bank of America has had its share of public relations dust-ups, but its recent decision not to raise fees shows that it does care about public perception of the company. Cutting the fat is one thing, but decimating a seven-year-old program that works is quite another. As a cost-cutting measure, this move doesn't make sense.