One of the country's largest unions is hitting back at troubled banking-giant Bank of America for rewarding executives with billions in bonuses while at the same time reportedly moving to cut thousands of jobs and shut down hundreds of branches.
On Friday, the Service Employees International Union sent an email to Bank of America workers asking them to sign a letter to company CEO Ken Lewis demanding answers about potential branch closures. The email notes that Bank of America made more than $3 billion in profits in the past three months but still is reportedly considering shutting down 10 percent of its branches - the equivalent of 600 offices and 5,000 jobs.
"As the backbone of Bank of America, frontline bank workers helped drive the growth of the company for low wages, while executives took home huge paychecks and bonuses," the email reads. "Last year, while the bank crashed, CEO Ken Lewis made $6,019 an hour. And even though taxpayers are backing Bank of America with $199.2 billion, it's the front-line bank workers who are going to hurt the most."
According to a recent report by New York Attorney General Andrew Cuomo, Bank of America issued $3.33 billion in cash and stock bonuses to executives in 2008, despite receiving $45 billion in bailout funds. Merrill Lynch, which merged with BofA in January, issued $3.6 billion in bonuses despite having losses of more than $27 billion. Combined, the banks had 860 employees were given bonuses worth at least $1 million. In addition, Bank of America has spent $1.5 million in lobbying fees since January 2009.
In an interview with the Huffington Post, Stephen Lerner, director of the private equity project at SEIU, expressed bewilderment that, at a time of such lavish compensation packages, BofA executives could contemplate making major closures.
"It is absurd that no matter what happens in the economy these guys figure out a way to award themselves with enormous bonuses and there seems to be no problem with laying off workers," said Lerner. "On the one hand the government is trying to stimulate the economy by pumping money into banks. But everything these banks are doing exacerbates the problem that they are supposed to be solving."
Moreover, Lerner argued that Bank of America had an obligation to its workers to provide, at the very least, some basic information about how they could be affected by branch closings.
"There has been no communication with workers, as far as we have talked to, about what is happening, what their rights will be, if they get severance pay, if there will be buyouts, if their health care will be continued, and so on," he said. "People don't know anything. And most importantly, there has been no discussion if they will take the money they pay in bonuses and move it to help their workers survive unemployment."
Earlier this week, it was reported that Lewis had outlined a plan to shut down Bank of America branches during a meeting with investors in Charlotte, N.C. BofA officials did not confirm or deny the story. And in subsequent days, SEIU moved quickly to blunt the possibility of thousands of jobs being lost.
The union's email is being sent to several hundred Bank of America workers who have joined its economic organizing efforts. The workers are being allowed to sign the letter to Lewis with their initials instead of name, out of concern that they could be fired for going public.