RBC Responds to Outsourcing Plans

The Royal Bank of Canada is under fire for replacing 45 employees with oversees workers. A representative of RBC admits that work is being moved to another supplier, and current employees are training their replacements. The company is looking for new jobs for the displaced workers, who will leave at the end of the month. The new supplier is iGATE Corp., an Indian multinational outsourcing firm.

In an interview, RBC HR chief Zabeen Hirji tried to explain that RBC isn't hiring the workers, and the workers aren't replacing RBC employees-just transitioning to the new staff. Both are tough sells. First, RBC hired the supplier who is hiring the workers (so they have some accountability). Second, having interim workers doesn't change the outcome: people are losing their jobs, and-as it appears-foreign workers will be doing the work. The reporter called the distinction "semantics" and said, "I get what you're trying to sell, but I'm not sure I'm buying it."

Criticism is high, particularly the concern that RBC is violating federal rules that foreign workers may not replace Canadian citizens. In response, the bank published a statement that said, "External suppliers with the right skills allow us to introduce new efficiencies, continually improve our service at reduced cost and reinvest in initiatives that enhance the client experience. Agreements with our suppliers include strict controls and ongoing monitoring to ensure full compliance with all regulatory requirements."

Public backlash is also high. A Facebook page, Boycott Royal Bank of Canada, has 7,600 likes.

Discussion Starters:

  • Analyze Zabeen Hirji's interview. What does she do well, and what could be improved? What are her strongest and weakest arguments?
  • Overall, do you buy RBC's position?
  • One article referred to Hirji's "corporate-speak explanation and histrionic hand gestures." Do you agree with this characterization?