Some contract workers in technology roles at Bank of America are being furloughed, as the Charlotte-based company pushes to further trim costs and improve efficiencies.
In Charlotte, some affected workers told the Observer they were informed about the furloughs on Monday and Tuesday. The move mirrors similar furloughs announced around the same time last year that affected information technology contractors working for the bank.
“As a part of our process to continually review our global operations to make the best use of resources, we made business adjustments with some of our vendors,” a bank spokesman said in a statement Wednesday. The move “ties directly to our ongoing focus on simplifying the company and delivering for our customers and shareholders.”
It’s unclear how many workers face furloughs or in what other parts of the country. It’s also unclear which contracting firms might be affected.
Any decisions on furloughs would come from vendors, not the bank, said the Bank of America spokesman. “It’s up to each firm’s discretion to manage certain aspects of the adjustments,” he said.
In a separate action, Bank of America this week said it notified fewer than 30 full-time Charlotte-based technology and operations workers that their positions were being eliminated. In describing those layoffs, the bank also cited its ongoing efficiency efforts.
The latest furloughs for Bank of America contractors come as large banks and other companies continue turning to the temporary source of labor, particularly for information technology work.
Some IT workers say it has become harder to get a full-time job with certain companies, like big banks, as those employers outsource many projects to contractors. While contract jobs can be attractive for people looking for short-term work, such jobs often come without paid vacation or benefits.
One Charlotte contract employee who works for Bank of America said he was told this week his pay is being cut by 5 percent and that he’ll be furloughed for two weeks without pay. The worker, who did not want his name disclosed to protect business relationships, said he was also furloughed for two weeks last year while doing contract work for the bank.
“This same thing (happened) to IT contractors late last October,” he said. “We were (told) to not come into work. Then the following week, we were to come into work, then the next week we were furloughed.”
“From 2015 to 2016, my salary alone has gone down 20 percent,” he said. “That’s with no benefits and constant pressure to perform at a high rate, while knowing you could be let go at any time.”
The Bank of America spokesman said he was not aware of any pay cuts for contractors related to the latest furloughs.
Under CEO Brian Moynihan, Bank of America has made cost-cutting a priority at a time when low interest rates threaten banks’ revenue growth. The Federal Reserve has raised interest rates only once, in December, after the regulator slashed them during the recession.
It’s also not uncommon for companies to look for ways to lower costs to meet budget goals as the year’s end approaches.
Bank of America also cut back on spending for information technology contractors last September. At the time, some of the affected workers told the Observer that their pay rate would be cut by 10 percent and that they would have to take a two-week, unpaid furlough.
The bank said that move was part of its efficiency strategy and that the changes only affected contractors affiliated with the bank’s global technology and operations unit.