Big Banks Benefit from Tax Bill, Aggressively Offshore American Jobs

Washington, DC – The banking industry is among the biggest beneficiaries from the Republican tax bill passed in December 2017. Yet many U.S. banks have been aggressively offshoring U.S. jobs, especially in the call center and customer service industry, to low-wage countries. Despite these offshoring practices, and their financial windfall from the tax bill, there is no movement from the big banks to return jobs from overseas. In fact, leading analysts believe that the tax bill will encourage the additional offshoring of American jobs.

On a press call held today, Senator Sherrod Brown (D-OH), Ranking Member of the Senate Banking Committee, joined Communications Workers of America (CWA) President Chris Shelton and affected call center workers to highlight how big banks have been offshoring American jobs, particularly in the call center industry; to describe how the Republican tax bill passed in December could make this offshoring trend worse; and to discuss steps that can be taken to slow and reverse this trend. CWA also released a new report it co-authored with the Committee for Better Banks (CBB) detailing numerous examples of how the banking industry has been laying off American workers while ramping up operations overseas in low-wage countries (access a copy of the new report here).

“As if the tax bill wasn’t enough of a giveaway to Wall Street executives, Congress is now turning its attention to yet another gift to the big banks,” said Senator Sherrod Brown. “The bill on the Senate floor this week dismantles the consumer protections we put in place after the last financial crisis and puts taxpayers at risk of more bank bailouts. These are the same big banks that are cashing in stock buybacks while sending call center jobs overseas. Instead of giving another handout to Wall Street banks, we should be focused on how we can support American workers and American jobs. Most people want to support American jobs by buying American whenever they can, and that includes the customer service they get from call centers.”

“We are releasing this report to start a conversation with the public, in Congress and in the political arena about how the big Wall Street banks like Wells Fargo are pocketing the money from the tax scam while destroying thousands and thousands of American jobs and potentially jeopardizing individuals' personal data by shipping these jobs overseas,” said CWA President Chris Shelton.

Michael Lewis, a former worker at an American Express call center in Phoenix, Arizona, described how his job was offshored to India and he was forced to train his replacement: “I went to India for 8 weeks but ended up staying for 12. There I trained entire teams on the job functions that had been done in the Phoenix center. The whole time I suspected, but no one would admit, that I was teaching them how to start another center so that they could downsize the one where I worked. When I returned from India, several whole floors of the center were called in, team by team, and fired. While the company offered severance packages, they did not replace a permanent job, and the offshoring forced our large workforce to go out and find new jobs in a tough market.”

And Pam Wynn, a former Bank of America call center worker in Cleveland, Ohio, described her experience when Bank of America closed her call center in 2013: “Management announced that the whole center was closing and all 1,200 people would be fired. They claimed that Bank of America would no longer be doing the work we were doing at our center, but that made no sense to us. There was no way to track the work or to know where it went once our center closed, but we always suspected that it went to offshore locations that the bank did not want us or the customers to know about.”

The new CWA report includes a detailed look of the offshoring practices of Wells Fargo and Capital One, both of which have engaged in recent rounds of layoffs of American call center workers while ramping up operations overseas in the Philippines. The report also offers examples of American layoffs and overseas operations for a host of other large and mid-sized U.S. banks and financial institutions –Ally Financial, American Express, Bank of America, Citi, Citizens Bank, Goldman Sachs, JP Morgan Chase, M&T, Morgan Stanley, State Street, and SunTrust – and offers a snapshot of Equifax’s call center presence overseas, an underappreciated storyline as observers try to piece together their massive security breach and bolster prevention. By design, corporate offshoring often takes place without accountability and transparency. As a result, the details of American layoffs and expanded operations overseas are just examples and evidence of this larger trend – we expect that the actual numbers of jobs offshored are even higher.

It is clear that the CEOs and major shareholders of big banks and other corporations will continue to send American jobs overseas unless Congress takes action. CWA supports federal call center legislation, co-sponsored by Senator Brown in the Senate, that would add new accountability and transparency to the offshoring process and make U.S. companies that offshore their call center jobs ineligible for certain taxpayer funded grants and loans. In addition, the bill would give U.S. consumers a right to know where they are calling and to be transferred to a U.S. based location. It’s also critical for Congress to reverse the offshoring incentives in the recently passed Republican tax by passing the new “No Tax Breaks for Outsourcing Act,” introduced recently by Congressman Lloyd Doggett (D-TX) and Congresswoman Rosa DeLauro (D-CT) in the House and Senator Sheldon Whitehouse (D-RI in the Senate.

• Read the new CWA/CBB report on bank offshoring: https://www.cwa-union.org/cwa-cbb-bank-offshoring-report
• Listen to the Press Call: