Bank Of Scotland to buy ESB Shops

Elmo

The ESB has confirmed that it has agreed in principle to sell all of its 54 shops to Bank of Scotland (Ireland).

The deal, which is valued at around €120 million, was given the go-ahead at a special meeting of the ESB board this morning.

It will give the bank a wide network of branches throughout the country and make it a significant force in the retail banking market in Ireland.



The ESB Officers' Association, which represents all of the shops' 350 staff, said it was shocked by the news, particularly as the union was currently in negotiations with the company on restructuring proposals.

Two years ago, 27 ESB outlets were closed as part of a restructuring

Good News for Banking. Bad news for ESB customers who will now have no contact with the company other then through the ESB call centres.

uberwolf

this is massive, what an instant presence.

Previous BOS moves have shaken up the market without much exposure themselves (mortgage - big publicity, but very few qualifiers). This is entirely different.

I look forward to the response from the competitors

byte

I assume all the ESB shops will become BoS banks then? Can't beat a bit of healthy competition in banking!

From the news on 2FM, all staff have the option to keep their jobs when the new owners take over which I guess is also a good thing.

Scubadevils

byte wrote:

From the news on 2FM, all staff have the option to keep their jobs when the new owners take over which I guess is also a good thing.

Maybe I missed something but how can electrical retail staff keep their jobs in a bank?

If this goes ahead there will be a lot of happy independent electrical retailers nationwide! Been many years of claims of unfair competition which is probably true.

MrPudding

You would have to presume that there must be an agreement between BOSI, ESB & any union involved that the staff have the option to stay on should they wish and that there is a budget for retraining them.

MrP

Elmo

If this goes ahead there will be a lot of happy independent electrical retailers nationwide! Been many years of claims of unfair competition which is probably true.

I don't see how the ESB were competing unfairly, their the most expensive electrical retailer.

The only think now is that you won't be able to be electrical goods through your electricity bill. But the ESB will probable do a deal with one or two of the other major retail outlets to provide that service.

c3van5

well i work in an esb call centre and noone has yet been told if we still have our jobs or not. i answer the phones for the appliance section of the company so closing the shops means that i am out of a job..... anyone care to shed some light?

A Dub in Glasgo

You might want to speak to your union (assuming you are in one)

RuggieBear

Elmo wrote:

I don't see how the ESB were competing unfairly, their the most expensive electrical retailer.

The only think now is that you won't be able to be electrical goods through your electricity bill. But the ESB will probable do a deal with one or two of the other major retail outlets to provide that service.

That was a huge advantage as was the ability to look at someones previous bill payment history before deciding to allow them to purchase on credit.... :eek:

Another factor is that the ESB gave very good terms to some of their senior staff to get them to retire early....one of the sweetners was that the retired staff could buy goods from the ESB stores at just over cost price.....i'm pretty sure the ESB will be forced to make alternative arrangemnets for this...

Scubadevils

That was exactly it regarding putting products on the bill. I have worked in electrical distribution for several years and have listened to independent dealers complain about the ESB and unfair competition in this respect. In recent years the ESB had become more competitive on pricing too. Key products such as entry level TV, DVD white goods etc can be as cheap in ESB stores as anywhere else. In a lot of cases independent dealers have dropped certain products from their stores as they simply could not compete with the likes of Power City, ESB, Currys etc.

Elmo

In a lot of cases independent dealers have dropped certain products from their stores as they simply could not compete with the likes of Power City, ESB, Currys etc.

So there is unfair competition with independent retailers from Power City and Currys etc not just the ESB shops.

That was a huge advantage as was the ability to look at someones previous bill payment history before deciding to allow them to purchase on credit

Maybe they will now pass this option on to other retailers. I am sure other retailers would like to get their hands on that facility.

I still think customers won't be happy now that they will eventually not have any face-to-face contact with the ESB.

I surprised that big companies don't see the value of talking to someone in person.

BuffyBot

Once they don't force any of those god awful all-singing all dancing Halifax ads on us, I'm happy.

It'll be interesting to see what banking products they bring out to compete with the big boys!

RainyDay

I'm amazed that the staff are to be offered BOTH a generous redundancy package and a new job with BOSI! One or the other would be fair, but why both?

RuggieBear

RainyDay wrote:

I'm amazed that the staff are to be offered BOTH a generous redundancy package and a new job with BOSI! One or the other would be fair, but why both?

It's the ESB....you should have seen the ridiculously lucrative early retirement packages....I have, my uncles on one

BuffyBot

One or the other would be fair, but why both?

On the other hand, why not? Retain some mature staff, who are familiar faces to the locals, have plenty of customer facing experience, are able to use computer systems etc..makes a bit of sense to me actually.

Scubadevils

Elmo wrote:

So there is unfair competition with independent retailers from Power City and Currys etc not just the ESB shops.

Well, not really, I was branching off into something else there!

Products they have dropped tend to be the loss leaders that the multiples have had price wars with. eg- Power City advertise a 28" w/s TV that has an SSP of say 399 and they have it reduced to 379. Currys respond and go out for 359. Within a of a couple of weeks the TV has become 349. Generally it will end at a certain price like 349 in this example due obviously to margin. The ESB will also drop their prices to compete but have the added advantage of the bill paying option. Where independents struggle is they cannot afford to drop their margin to the same degree so they either drop the product from their range or offer free delivery & installation which still costs them money obviously.

I think there is certainly a myth out there that electrical goods have high margin. (I'm sure I will get attacked for this )

RainyDay

BuffyBot wrote:

On the other hand, why not? Retain some mature staff, who are familiar faces to the locals, have plenty of customer facing experience, are able to use computer systems etc..makes a bit of sense to me actually.

But if the staff are retained, why should they get a redundancy payment?

MrPudding

Because they work in an Irish semi-state company and the unions would threaten to bring the country to it's knees if they don't get it?

MrP

BuffyBot

RainyDay wrote:

But if the staff are retained, why should they get a redundancy payment?

Why not? If I was made redundant, is there any reason I couldn't go work for another company? Why does it matter that it occupies the same building as my old job? BoSI hasn't guaranteed them a job, nor do we know how many of the ESB staff will take the offer up. They won't be joining BoSI on the same salaries and conditions they have in the ESB - I'd imagine they'll be back down at entry level. I can't see why it's a problem.

RainyDay

BuffyBot wrote:

Why not? If I was made redundant, is there any reason I couldn't go work for another company?

That's a different scenario. You're comparing apples & oranges. Reduncancy is designed to compensate an employee where their job no longer exists. In this case, the job still exists. While there is nothing to stop a redundant employee accepting any job offer, it is quite different where they are guaranteed the job.

BuffyBot wrote:

BoSI hasn't guaranteed them a job, nor do we know how many of the ESB staff will take the offer up.

Yes, it has guaranteed them a job - From this Examiner article

More than 400 staff will be offered redundancy packages as well as new jobs with the bank.

BuffyBot wrote:

They won't be joining BoSI on the same salaries and conditions they have in the ESB - I'd imagine they'll be back down at entry level. I can't see why it's a problem.

There may be some truth in this, though I haven't seen any facts on the kind of packages they'll be getting at BOSI. Have you got any hard information on this? I do know that the packages available to the ESB Group staff will be quite generous (as is typical in semi-state sector) - 9 weeks pay per year of service. Remember it is you & I who'll be paying for this through our ESB bills.

BuffyBot

In this case, the job still exists.

A job still exists, not the job. Not the same thing at all.

Yes, it has guaranteed them a job

That's all very well, but how many will take it up?

There may be some truth in this, though I haven't seen any facts on the kind of packages they'll be getting at BOSI.

I don't have hard information on this. It wouldn't make financial sense for BoSI to do anything else though. I'd pretty much lay money down that the jobs will be entry level grades, and the people who do stay on will be treated pretty much the same as they other entry level staff.

Remember it is you & I who'll be paying for this through our ESB bills.

Well, we would have had to cough up sooner or later anyway - the ESB shops were going to be axed sooner rather than later.

RainyDay

BuffyBot wrote:

That's all very well, but how many will take it up?

If they don't take it up, then fair enough - let them have their redundancy deal - but there is still no good reason why they should get BOTH the redundancy (at our expense) and the new job.

BuffyBot wrote:

I don't have hard information on this. It wouldn't make financial sense for BoSI to do anything else though. I'd pretty much lay money down that the jobs will be entry level grades, and the people who do stay on will be treated pretty much the same as they other entry level staff.

Don't forget that there are fairly strict [url=http://www.entemp.ie/employment/rights/transferofundertakings.htm
]TUPE regulations[/url] about what can happen in such circumstances, including protection for employees terms & conditions. I don't think BOSI will be able to cut salaries.

BuffyBot wrote:

Well, we would have had to cough up sooner or later anyway - the ESB shops were going to be axed sooner rather than later.

It's not a question of timing. If the staff get new jobs, then there is no reason for them to get a redundancy payment (whether sooner or later). We had a great chance here to offload this underperforming asset at no cost to the state, but it looks like ESB missed that chance, and you & I will be picking up the bill.

BuffyBot

From that site:

A transfer of undertakings occurs when a business or part of a business is taken over by another employer as a result of a legal merger or transfer.

You're making the assumption this is a straight transfer of staff from A to B. I'm making the assumption that it isn't. They employees of the ESB aren't having their employment transferred to a new employer, they're having the option of joining a new company altogether. Perhaps if ESB were selling the shops to another electrical retailer who intended to use them as electricity shops, there there would be a transfer - but in this situation, I can't see that being the case.