HSBC hands £1,500 payout to half of employees, but warns over workforce cuts

HSBC will give a one-off payment of £1,500 to about half of its UK staff to support them during the cost-of-living crisis, but bosses have warned of further cuts to the workforce.

The banking giant said the cash boost will go to more junior staff including customer-facing employees in UK branches and contact centres.

It will reach the pockets of around 48% of UK-based employees, which is about 17,000 people.

The impact of rising inflation and the soaring cost of energy means some workers will need more support to avoid financial hardship in the coming months, HSBC said.

The one-off payments follow the bank’s discussions with trade union Unite, and will arrive in August pay cheques.

Dominic Hook, Unite national officer, said: “Unite has worked tirelessly to demonstrate to HSBC the need for urgent action to help thousands of employees facing the largest squeeze on their incomes.

“The union will continue to campaign to ensure all staff receive a fully consolidated pay increase to ensure pay rates keep up with living costs.”

But bosses at HSBC said a cut to its workforce will be “inevitable over time” as it shuts branches and moves to more digital and automated banking services.

The bank said it aims to trim worker numbers by not replacing some staff when they leave, with typically between 20,000 and 25,000 quitting each year to change jobs, according to chief financial officer Ewen Stevenson.

These cuts through natural staff turnover could be managed effectively to minimise the need to restructure or make redundancies, he said.

HSBC – which has more than 218,000 staff across the globe – had announced plans in 2020 to axe 35,000 jobs worldwide as part of aims to cut annual costs by 5.5 billion US dollars (£4 billion).

It also said it would be closing an additional 69 branches in March, adding to the 82 closures planned in January last year.

HSBC is among several banks to pledge cash support for staff after campaigns led by Unite.

Around 95% of employees at Co-operative Bank will receive a £1,000 rise in September, with only those on the highest salaries excluded.

TSB, Lloyds Banking Group and Barclays all recently announced one-off payouts to help staff struggling in the tougher economic climate.

HSBC added it would be considering the longer-term impact of inflation and higher cost of living for all its staff in annual pay reviews, beyond August’s payout.