Giving employees a cheque and a few years off is a novel approach to beating the recession - will it catch on, asks Fiona McCann
NEWS THAT staff of Permanent TSB have been offered up to €20,000 for a two-year career break, or up to €35,000 for three years off, has been circulating at water coolers and percolating through coffee bays all over Ireland. Although some may interpret it as a distressing reminder of our steadily tanking economy, most reactions are more akin to envy than anxiety.
Being paid by your employer to take 24 months worth of lie-ins without losing your job: what's not to like? Not much, if reaction from Permanent TSB employees is anything to go by. Within days of the announcement, 30 applications were made, with 200 "expressions of interest" on top of those.
"The initiative was communicated to staff on Friday of last week and the initial response has been extremely positive," says Ray Gordon, spokesman for Permanent TSB.
So much so, in fact, that a similar offer is to be extended to employees in the retail business of sister company Irish Life over the coming weeks, according to Gordon. This will add a further 2,000 staff members to the 2,500 eligible from Permanent TSB, with no limit set on how many will be allowed take up the offer.
"We haven't put a cap on it," says Gordon. "We will endeavour to facilitate as many people as possible but we cannot commit to facilitating everyone who applies."
Sobering words, perhaps, for those already booking a two-year stint on a Thai beach, but Gordon is optimistic. "We don't believe we're going to be swamped with applicants either."
Perhaps not, though the company is reporting interest not only from its own employees but from other companies and media at home and abroad. "It has clearly struck a chord with people," says Gordon.
Within the world of human resources, he says, the reality is that companies need to be increasingly flexible to the changing circumstances. "I think it's a sign of how progressive the banking sector is becoming and we are surprised by the level of interest there has been in it."
It's not just bored employees and journalists who are taking notice. Human resource companies and management consultancies will also be looking to see how the Permanent TSB deal pans out.
"There's a broader issue here about organisations in a downturn or recession taking a longer term, strategic view on how they're managing costs or managing talent within their organisation," says Tom Walsh, senior consultant with the management consulting firm Hay Group.
"Sometimes there is a bit of a knee-jerk reaction in looking at how to take cost out of the business quickly to maintain shareholder value but what you really should be focusing on is long-term value. Taking costs out of the business can be a relatively straightforward thing but if those elements that you're taking out are creating value for you in the long term, then that is going to be to the detriment of the business when the economy lifts again."
In other words, companies that immediately look to redundancies to help cut costs in an economic crisis may be shooting themselves in the foot by removing one of their most valuable resources.
"We found that the companies that take the strategic view are more successful coming out of recession than others who pick the low-hanging fruit, in terms of taking the cost out of the business," says Walsh.
"There is an awareness that career breaks are a growing feature of the workplace in large companies now and that they have benefits for employers as well as employees," explains Gordon.
So who's most likely to take the money and run? "There's a recognition that it will have particular appeal to young people," says Gordon, but he emphasises younger employees are not the only ones who could benefit from the kind of offer on the table.
"We'd be at pains to say it's not confined to that, that it may suit other people as well who are further on in their careers, be it for taking time out with families or returning to studies."
BUT WILL EMPLOYEES WHO lived through high unemployment in the 1980s and are conditioned to hang on to their jobs for dear life be convinced their jobs will be safely awaiting their return in two years' time?
"I do think the way that it has been received brings home the fact that people have a different approach to work now," says Gordon.
"People were risk-averse in the 1980s but I think as a population and a workforce we've become much more reflective."
There is much to reflect on, including how far €20,000 can go without being swallowed up by tax. This would depend on whether employees who take the package find work elsewhere(the offer stipulates those who take it cannot accept work in a rival bank during their time off) and whether they choose to spend their break at home or abroad.
"It shouldn't require too much planning to make it tax-free," says Gordon. Which is a whole other discussion for the water cooler.
SPENDING IT
Five things to do with two years and €20,000
1. TRAVEL: Pick up a round-the-world ticket and country hop your way around the globe. Tickets at Trailfinders start at under €1,250, including taxes, for tickets spanning 12 months. You can always spend the second year going round in the other direction.
2. LIVE ABROAD: €20,000 may not go far in rip-off Ireland but a strong euro has much more mileage in plenty of other places. Think six months in South Africa, a year in Argentina or two full years on a Thai beach, all of which allow you to immerse yourself in a new culture while brushing up on your tan.
3. WORK ABROAD: If two years topping up the tan smacks of excess downtime, combine work and travel with a year in the antipodes. With many Irish eligible for a work visa in Australia or New Zealand, this is an opportunity to spend 12 months Down Under.
4. VOLUNTEER: Why not try your hand at working with the homeless in Chad or observing elections in Bangladesh? The UN Volunteer programme invites applications from all types of professionals, while VSO and the Irish company Suas also help place volunteers abroad.
5. STUDY: Two years is plenty of time to return to school or college. Earn a Masters, learn a language or a musical instrument, research and write your great unwritten novel. It could also be used to acquire new skills to flesh out your CV for when you return.