Union welcomes banking crackdown while urging caution

FIRST UNION MEDIA RELEASE

FIRST Union welcomes banking crackdown while urging caution on sales targets

Commerce and Consumer Affairs Minister Kris Faafoi’s announcement that stricter controls on banks and insurance companies will be introduced in new legislation is a welcome step in the right direction, but the Minister needs to be vigilant about how banks continue to use sales targets under different classifications, FIRST Union said today.

“We’re pleased to hear that the Minister recognises that financial sales targets for bank and insurance workers are unfair for customers and workers, and they ‘put profits ahead of people’,” said Tali Williams, FIRST Union Secretary for Retail and Finance.

“The Financial Markets Authority and Reserve Bank are right to be concerned that these targets pressure staff into the difficult position of up-selling services that customers may not need in order to meet profit-driven performance requirements.”

Minister Faafoi has signalled that impending legislation will introduce a new conduct licensing system for financial institutions like banks and insurers, stricter requirements to meet in terms of customer treatment, and a ban on sales targets.

“The Minister does need to be careful in dealing with these institutions when it comes to sales targets – we’ve already heard many reports that sales targets continue under other names, operating much the same as before, despite what the banks and insurance companies claim publicly,” said Ms Williams.

“Another important aspect is to ensure that regulators like the FMA are well-resourced enough to adequately monitor methodologies in these industries – often, that work falls to unions like ours, where members are seeing on-the-ground practices that jar with what banks are saying publicly.”

“We’ll be in touch with the Minister to offer our expertise in the area while the legislation is being drafted – workers’ voices are crucial in getting good law that’s informed by contemporary practice in the industry.”

“A commitment from banks is not enough on its own, and any law will need teeth to be credible.”

ENDS

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