THROUGH the Co-operative Insurance Society modernisation programme over 2,000 sales staff have been told that their roles are to be changed, which has "shocked" one union.
The two-year programme announced last year was a direct response to market and economic changes and is designed to ensure CIS's future as a profitable and growing operation.
The sales roles will be changing as a result of a new sales support structure with the development of 18 regional sales offices for financial advisers being created throughout the country.
Staff were sent a letter advising them of new terms and conditions of employment, and a revised remuneration structure. The change includes buying back the financial adviser's book of business. This book is where financial advisers have bought an ‘interest' in the CIS business.
This produced a special reward for sales of CIS products in the form of an increase in the value of this ‘interest', which could ultimately be sold onto a successor. CIS will be buying back this book from all advisers in August/September.
The new role, where the ‘financial adviser' title will still be kept, will also remove administrative tasks and collections from the staff and allow them more time to advise customers.
Jobs affected in the sales force management will see any displaced managers offered roles within the financial adviser network where no redundancies are planned.
During a recent union ballot the majority of financial advisers rejected the proposals, "Our members are totally shocked at the decision to dismiss the whole sales team," said John McGarry, Usdaw North West Divisional Officer.
CIS spokeman Russell Brady said "dismiss" is a strong term because it implies that the whole sales team will be expected to reapply for their positions and go through a selection procedure, "which is not the case" added Mr Brady.
Mr McGarry commented: "We have unanimously agreed that the union will write to every member advising them of their legal position and outlining clearly all the options available to them in what will be an extremely worrying time for the advisors.
"Usdaw has seen the massive efforts these advisors have put in to keep CIS competitive, but we have also recognised throughout the negotiations that changes were needed to secure the long-term future of the business."
Separately, there has been a reduction of over 1,560 full-time positions over the past year through a combination of recruitment freezes and redundancy. With proposals already announced CIS expects this figure to increase by a further 970 by the end of 2006.
The modernisation programme originally envisaged that financial benefits would only start to materialise properly in 2006, however, significant financial benefits are already being achieved and to date almost £ 30 million of annualised savings in expense and claims costs have been secured.
David Anderson, Chief Executive of Co-operative Financial Services, said: "Over the past 12 months CIS has delivered many of its plans and hence realised many benefits well ahead of target.
"While change is not always easy for some to accept, it continues to be necessary if we are to compete effectively in our market place, and provide what is fast becoming a truly compelling co-operative service for our customers.
"Although we are introducing new service options for CIS customers our financial adviser salesforce remains an integral and fundamental part of our plans for the future. By continuing to successfully bring savings, insurance and investments to millions of people from all kinds of social groups, they are not only continuing to deliver on our co-operative agenda, but that of the Government's as well.
"We also acknowledge our salesforce proposals were not accepted by the majority of union members in their recent vote, but we believe these proposals are the only means of securing a long-term and viable future for this channel."
CIS has already announced the appointment of AXA REIM to manage its £ 2.5 billion investment property portfolio, the largest deal to date within the UK financial services marketplace.
In the coming weeks CIS expects to announce the appointment of four further external fund managers to manage its £ 900 million overseas equities portfolio.
Join the Conversation