RBC replaces Canadian staff with foreign workers

[GostHacked]

This:Sounds like a loophole for RBC - the temporary workers will be learning the ropes for 2 years until they go back home, with the work having moved to India.

How much is that costing RBC to house these people for two years??? Does not make sense at all.

[The_Squid]

This:Sounds like a loophole for RBC - the temporary workers will be learning the ropes for 2 years until they go back home, with the work having moved to India.

They are working in Canada, replacing Canadians who did the job. You may think that's a loophole, but you are likely incorrect as the legislation says nothing about exceptions for this type of worker. The program is only available if Canadians are not available to do the work. Clearly this is not the case here....

[hitops]

VERY interested to see how this turns out. I wonder if thousands of people will actually close their accounts tomorrow. I wonder if others will close their account simply out of fear of too many others doing it.

[Michael Hardner]

But that might also show the state that the bank is in, needing to outsource in order to save money. I don't think my money is safe there anymore.

The point has already been made: people buy cheaper goods, so why would the bank be any different ?

[Michael Hardner]

How much is that costing RBC to house these people for two years??? Does not make sense at all.

Do you really think the bank won't be saving money with this move, housing costs and all ?

[Michael Hardner]

VERY interested to see how this turns out. I wonder if thousands of people will actually close their accounts tomorrow. I wonder if others will close their account simply out of fear of too many others doing it.

I don't think thousands will be closing their accounts. If they cared that much, we wouldn't be 8 or 10 years down this road already.

[Michael Hardner]

They are working in Canada, replacing Canadians who did the job. You may think that's a loophole, but you are likely incorrect as the legislation says nothing about exceptions for this type of worker. The program is only available if Canadians are not available to do the work. Clearly this is not the case here....

But if the job is specifically set up to transition support to offshore then it's a different job too.

[hitops]

Do you really think the bank won't be saving money with this move, housing costs and all ?

Depending on the reaction to it, it's quite possible they will not. Don't forget banks only hold a tiny amount of their total deposits, and their overleveraging needs to be tied to this amount. It's conceivable that people closing accounts might actually make a difference.

I don't think thousands will be closing their accounts. If they cared that much, we wouldn't be 8 or 10 years down this road already.

It has nothing to do with that, it's not a sudden rational reaction by thousands of people. It's happening because a news story brought it too light. Sometimes that's how things work in the internet age. People need to have a sudden event to clue in.

Edited April 7, 2013 by hitops

[Argus]

VERY interested to see how this turns out. I wonder if thousands of people will actually close their accounts tomorrow. I wonder if others will close their account simply out of fear of too many others doing it.

More importantly, how many will sell their shares in RBC? I have held RBC stock from time to time. I don't currently but if I did I would sell it tomorrow morning.

[Michael Hardner]

More importantly, how many will sell their shares in RBC? I have held RBC stock from time to time. I don't currently but if I did I would sell it tomorrow morning.

You would sell shares in a company that was cutting costs ? Really.

[Argus]

You would sell shares in a company that was cutting costs ? Really.

The thing about the banks is that it's six of one, half a dozen of the other. There is no real advantage in holding RBC as opposed to CIBC. Most private investors just shrug and pick one that they like. I don't lose anything by signalling my displeasure with offshoring good jobs by selling my shares. I can pick up other bank shares instead.

It's not always about cost cutting. Some of us capitalists do not like outsourcing at all, let alone sending the jobs overseas.

[Michael Hardner]

The thing about the banks is that it's six of one, half a dozen of the other. There is no real advantage in holding RBC as opposed to CIBC. Most private investors just shrug and pick one that they like. I don't lose anything by signalling my displeasure with offshoring good jobs by selling my shares. I can pick up other bank shares instead.

How much has offshoring hurt demand for Canadian bank stocks so far ? Again, we're talking about a trend that is at least 10 years old.

[jacee]

It's not even about outsourcing, which is perfectly legal. It's about breaking Canadian laws by bringing foreigners into Canada to replace Canadian workers already doing the job.

Immigration Minister Jason Kenney says that under federal rules, no foreign worker can be allowed into Canada if the move displaces a Canadian from their job. (CBC)

If an employer is playing some kind of a shell game, that is not consistent with the rules, the immigration minister said. [The Temporary Foreign Worker Program] is not there for employers to make short cuts to displace Canadians and if they are trying to do that, they should have the book thrown at them.

I hope someone's throwing the book, but I doubt it.

Edited April 7, 2013 by jacee

[Michael Hardner]

I hope someone's throwing the book, but I doubt it.

The same 'book' that wasn't thrown at China for bringing in foreign miners, I expect.

[jacee]

The same 'book' that wasn't thrown at China for bringing in foreign miners, I expect.

The unions' legal actions are having an effect:

http://www.ctvnews.ca/mobile/canada/b-c-mining-firm-sends-16-chinese-workers-home-delays-hiring-more-1.1133847

[Michael Hardner]

http://www.huffingtonpost.ca/2013/04/07/hd-mining-foreign-workers-cleared_n_3031230.html

This article seems to say the Chinese firm met or exceeded requirements.

[Argus]

How much has offshoring hurt demand for Canadian bank stocks so far ? Again, we're talking about a trend that is at least 10 years old.

It's funny how these things work. Most Canadians probably have no idea the banks are outsourcing jobs offshore. But something like this has the potential to sudden inflame public opinion.

[jacee]

http://www.huffingtonpost.ca/2013/04/07/hd-mining-foreign-workers-cleared_n_3031230.html

This article seems to say the Chinese firm met or exceeded requirements.

I think to get the whole picture, you need to read the 'but' and 'however' paragraphs. It's not over til it's over:

That judicial review is slated to take place in April.

The company has argued it made significant efforts to recruit qualified Canadian workers and met or exceeded all the requirements of Human Resources and Skills Development Canada in obtaining temporary foreign worker permits.

But earlier this month, the company reluctantly agreed to turn over to the unions the resumes of hundreds of job applicants who were turned down.

Edited April 8, 2013 by jacee

[Bonam]

You would sell shares in a company that was cutting costs ? Really.

Why not? I'd rather invest in a company with an eye towards growth, building its reputation and a dedicated and loyal base of both customers and employees, rather than pinching a few pennies of labour costs, likely at the price of reduced quality of service as well as bad press that will likely impact its future business somewhat. Implementing a scorched Earth cost-cutting policy is a sign of a desperate company trying to stay afloat, not a prosperous one.

Edited April 8, 2013 by Bonam

[Michael Hardner]

It's funny how these things work. Most Canadians probably have no idea the banks are outsourcing jobs offshore. But something like this has the potential to sudden inflame public opinion.

I'm surprised that my own friends don't realize that my career was affected by globalized trade.

[Michael Hardner]

Why not? I'd rather invest in a company with an eye towards growth, building its reputation and a dedicated and loyal base of both customers and employees, rather than pinching a few pennies of labour costs, likely at the price of reduced quality of service as well as bad press that will likely impact its future business somewhat. Implementing a scorched Earth cost-cutting policy is a sign of a desperate company trying to stay afloat, not a prosperous one.

Why is cutting costs at odds with growth ? And what does quality of service have to do with it ? Have you noticed your bank IT services deteriorating so far ?

Those RBC people who are complaining are likely the ones who survived waves and waves of cuts already. Yes, there may be a political impact but that's more of a testimonial to how unaware the average Canadian is of the business world.

[hitops]

Why is cutting costs at odds with growth ? And what does quality of service have to do with it ? Have you noticed your bank IT services deteriorating so far ?

Those RBC people who are complaining are likely the ones who survived waves and waves of cuts already. Yes, there may be a political impact but that's more of a testimonial to how unaware the average Canadian is of the business world.

When support is provided by India, it is usually horrendous. Not just the bank obviously, all kinds of companies do this. Having people that can speak basic English, have some inclination towards trying to solve your problem and have some authority to do so, is invaluable.

You point out that Canadians are unaware. I supposed this is true, but I'm not sure how that is an argument for continued inaction. They don't know much, so when they learn something they should continue acting as if they did not?

[Michael Hardner]

When support is provided by India, it is usually horrendous. Not just the bank obviously, all kinds of companies do this. Having people that can speak basic English, have some inclination towards trying to solve your problem and have some authority to do so, is invaluable.

You point out that Canadians are unaware. I supposed this is true, but I'm not sure how that is an argument for continued inaction. They don't know much, so when they learn something they should continue acting as if they did not?

Well, understanding that job losses are a given when grade is globalized, and that this has been happening in the described sector for at least 10 years (and now I remember the first Chinese national I met was in an office run by EDS (Ross Perot's old company) in Toronto in 1998 ! ) and in other sectors for 20 years plus. I'm not sure whether anything can or even should be done about it.

They sure do like those low prices.

[Bryan]

I'm surprised that outsourcing call centres to India is still happening. I thought that by now, the trend would be reversing. Not because of any local backlash to lost jobs, but because of the poor value for the money the domestic companies get for doing it. Customer service drops off drastically, and companies that don't do it have huge competitive advantage over those that do.

[Bonam]

Why is cutting costs at odds with growth ? And what does quality of service have to do with it ? Have you noticed your bank IT services deteriorating so far ?

Those RBC people who are complaining are likely the ones who survived waves and waves of cuts already. Yes, there may be a political impact but that's more of a testimonial to how unaware the average Canadian is of the business world.

Yes, almost invariably any service provided out of India or some other offshore location is inferior to something provided locally. The people on the other side of the world are difficult to understand, have no direct ties or authority to do anything in the company you're actually trying to deal with, and don't care/don't have any stake in the company you're trying to deal with doing well. The same holds true for IT. Outsourced IT departments are an invariable horror story. Find me even one company that outsourced its IT and a few years later was glad it did so.

As for Canadians being unaware, perhaps, that's why the occasional news article to remind them is necessary.

Well, understanding that job losses are a given when grade is globalized, and that this has been happening in the described sector for at least 10 years (and now I remember the first Chinese national I met was in an office run by EDS (Ross Perot's old company) in Toronto in 1998 ! ) and in other sectors for 20 years plus. I'm not sure whether anything can or even should be done about it.

They sure do like those low prices.

Who likes which low prices? Which prices are being lowered as a result of RBC replacing this batch of employees with iGate's "services"?

Oh, and as for trade being globalized... globalization is an economic policy, one that nations willingly pursue. The policies a nation pursues should be beneficial to that nation. If/when they cease to be so, they should be re-evaluated. Maybe you'd prefer to blindly trample ahead with existing policies without pausing to think once in a while, but I do not.