News
Nov 16 2012

When the Co-op Bank merged with the Britannia Building Society, based in Leek, Staffordshire, it was heralded as a super mutual and the two seemed a perfect fit. But many members and employees of the Britannia say they’ve done very badly out of the merger.

Health worker Stephanie Lawley, who lives in Nantwich, took all her family’s accounts away when the Britannia merged. Like many, she sees it more as a takeover, even though members voted to join the Co-op. What’s been lost, she said, is the family atmosphere.

‘Disgruntled’

“We used to get a really good bonus from the Britannia every year as a reward for our loyalty,” said Lawley. “This was to thank us for continuing to vote to stay mutual. Now, with the Co-op merger, we only get a Co-op dividend and it’s nowhere near as good.”

Another former Britannia member who preferred to remain anonymous said she and her family have definitely lost out. “I was very disgruntled by the merger,” she said. “It’s financially disadvantaged us. The piddling little Co-op divi is just a few pounds; we used to get several hundred in our members’ loyalty bonus.”

Lawley added that charitable donations have also dried up. “I run several charity events for children with disabilities,” she said. “Once you could go to the right person at the Britannia, ask for a donation, and they’d make a decision quickly and even attend the event.

“We never needed much – just, say, £1,500 for hire of the venue, equipment and transport. But because of the family atmosphere at the Britannia, you could always approach them. I’ve tried to get money from the Co-op but I just can’t. It’s nowhere near as friendly now as it used to be. We’re now with the Yorkshire Building Society.”

The Britannia was long Leek’s biggest and most prestigious employer, offering a career ladder in financial services. Now, former and current employees claim, all the best jobs have gone to the Co-op’s Manchester headquarters. Security and other roles have been outsourced and there has been a 25 per cent reduction in staff at Leek, with more redundancies expected.

Redundancy

The fear is that Leek staff will be kept on purely for low-level roles. This affects the whole town since local economies rise and fall with the number of well-paid professional jobs.

“I wouldn’t want to work there anymore,” said one former worker. “It’s just another big faceless corporation and the staff aren’t treated well. There’s a horrible atmosphere, which there never used to be. They say we voted for it. But I can’t find anyone who did.”

Among many critical letters to the Leek Post and Times was one from a Britannia employee awaiting redundancy. “We were subjected to many months of corporate brainwashing… Every week we hear of more colleagues losing their jobs and those of us still working there are expected to travel to Manchester, Skelmersdale or Stockport at the drop of a hat, with no regard for childcare issues or personal circumstances.”

A spokesman for the Co-op insisted that there was a commitment to Leek and said it was unlikely that loyalty bonuses would have been as high as they used to be because of the poor economic climate. He pointed out that Britannia members voted in favour of the merger three years ago.

“A small number of colleagues have been affected by the outsourcing of support services such as security,” said the spokesman. “This is completely in line with the wider policy we operate across our operations to ensure that these services are undertaken by those with specialist sector expertise in providing such services.

“As a Manchester-based business with other major centres in London, Plymouth, Skelmersdale and Stockport, it’s inevitable that from time to time roles will move from one location to another. But Leek is an important site to our business and is the centre of excellence for our mortgages and savings business.

Mutual

“The merger provided an opportunity for two strong businesses to come together and create a mutual financial services organisation with the scale to offer consumers a compelling alternative in the market.

“This has been our focus throughout the integration and period since and is evidenced by customers now having around 250 more branches across the UK to do their banking at a time when many feel disillusioned with their current provider.”

 

Photo: Getty Images

 

11 comments on Feeling’s not mutual

  1. vic says:

    it is widely understood that this was only approved by members as there was a third option of indifference (i.e that member happy to accept boards recommendation) on the vote enabling directors to push it through. in fairness, those same directors have all since left/been pushed due to the manchester-centric vision and heavy redundancies of britannia staff.

  2. Natasha says:

    I used to work for Britannia and the “merger” with the co-op was the worst thing to have happened to it. Ask any member of staff current or ex and they’ll say we would have preferred to have tackled the economical climate on our own. Leek Building Society managed it!
    It doesn’t matter what they say about having a commitment in Leek,all of the top jobs were moved to Manchester, all lead functions like IT, HR, Payroll everything went to Manchester. The options were very simple, move to Manchester for very little reward or go, so a lot of us took our money and ran. The co-op doesn’t care about values and it doesn’t care about staff, all it cares about is trying to be the biggest which doesn’t always result in being the best!

  3. dawn broadhurst says:

    I was aformer employee and saw the leavers list there have been hundreds made redundant. CFS are no where near a good as the Brit they were 20 years behind any technology and treated people from Leek like country bumpkin – clearly forgetting we had been a successful company for over 150 years. The worst I saw was at the Leek Show this year was the Coop advertising their funeral services with a large hurst on show – I ask you is that appropriate at a Country Agriculural Show – I think not. My family and I have moved all our saving to LEek united.

  4. Duncan Woolliscroft says:

    The supposed merger of the Co-op and Britannia has destroyed a once proud company that was sold down the river by a board of directors interested only in themselves. They had no consideration for staff or members, only there own bank balances and careers.

    The thing that upsets people the most is the lies and spin that we all fell for. If it was all so above board and in our best interests, why were staff who knew the truth made to sign a document to keep the secret in order toget their redundancy package? The secret being that, rather than a merger, it was a hostile takeover.

    I hope the culprits are haunted forever by the fact that they have destroyed a once great company and damaged a local community.

  5. Laura Marcus says:

    Thank you very much for commenting on this. As a Leek resident myself for the past 24 years, I’m well aware of how important Britannia was as both a major employer and also a badge of pride for the town. I’m deeply saddened by the changes going on there and know from talking to many former employees that it has been a change for the worse.

    I recently heard about some staff who will be made redundant two weeks before Christmas. Callous, cruel and uncaring. Apart from the Coop PR team, I couldn’t find ANYONE who was in favour of this merger/takeover. And believe me, I did try.

  6. Andy says:

    You all voted yes, so need to live with the result. I voted NO and moved my accounts. Vote with your feet an do the same !!!!

  7. Anonymous says:

    I worked for Britannia for over 20 years, and was always proud to work there. We trusted Neville and the other directors who assured us that the merge with the co-op was the best thing, and that we would all be better off for it. I am completely disgusted that first Neville, and then all the other Directors have now left one by one, and left the former Britannia staff in the lurch. I found that the whole atmosphere and treatment of staff was so appalling that I left without redundancy, and would prefer to be unemployed than continue working there.

  8. Chris Toland says:

    I voted for the merger and I now apologise to the people affected by what I thought at the time a good idea. I find the staff at my local Britannia in Wood Green pleasant but my dealings with the Co-op call centres I will decline to comment on

  9. Dave says:

    I voted NO, but as a borrower I don’t have the easy flexibility to move elsewhere. We were sold down the river by the apathy of the non-voting members, whose votes then passed to the Britannia board to do with as they wished ie allow the takeover (and get highly paid jobs within the Co-op Bank).
    With the news that the Co-op Bank’s credit rating is downgraded to ‘junk’, and the speculation that the Co-op will have to sell off its banking arm, one can only suppose that what is left of Britannia will be swallowed up and disappear within another high street banking group.
    The Co-op’s idea of mutuality is not mine – I suspect I will not get a vote to say what should happen to my mortgage lender, but will have to put up with whatever is decided behind closed doors.
    If Britannia, as a building society, was struggling, how is it that Nationwide appears to go from strength to strength as a (albeit bigger) mutual?

  10. Laura Marcus says:

    I believe the Nationwide was one of the very few financial institutions that remained essentially conservative in its lending policies.

    It did take over the Cheshire and the Derbyshire so I’ve no idea if that, like the Co-op’s takeover of the Britannia, put it into greater jeopardy.

    But the fact is, many lenders made very poor lending decisions in the mid Noughties. It was herd mentality. Everyone else seemed to be doing it. So they thought they should too.

    Also there was a lot of greed involved. The Nationwide largely I think remained above all this. Which is why it remais.

  11. Anon says:

    I’m afraid to say that despite all of the understandable nostalgia about Britannia, it was actually in a poor state at the time of being acquired by the Co-op. The other side of this story is that many at the Co-op no doubt regret ever taking on Britannia, I’m certainly sad to see the negative impact it has had. I should also highlight that the generous members bonus paid by Britannia was due to a flawed business model – basically the profits to pay these bonuses were earned in riskier areas which a Building Society should not have been involved in. Hardly a reason to be misty eyed at the level of those members bonuses then. Co-op will have the legacy of a shocking Britannia commercial property book for years to come. Two financial institutions ruined by the decisions of their respective Boards.

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