Lloyds to put 3,000 jobs at risk in new plans to 'transform' business

Lloyds Banking Group is preparing to place thousands of employees at risk of dismissal as part of a sweeping strategy overhaul aimed at embedding a "highperformance culture."

The bank, which employs nearly 63,000 people, plans to revise how it manages staff performance. Roughly 3,000 workers - those identified in the bottom 5% of performance - are expected to be placed under review, with as many as half likely to lose their jobs, according to the Financial Times. The practice means that employees who managers deem to be underperforming can be put on "structured support" plans - but face losing their jobs if improvements are not ultimately made.

The new approach was discussed at a recent meeting of the bank's group executive committee, and comes as chief executive Charlie Nunn enters the final phase of his plans to cut costs.

A spokeswoman for Lloyds said it was focused on "transforming our business". She said: "As we build highly-skilled teams to move faster forward and deliver great outcomes for our customers, we are striving to embed a high-performance culture in the organisation. To achieve this, and in line with wider industry practice, we continuously look for ways to help our colleagues perform at their best.

"We know change can be uncomfortable, but we are excited about the opportunities ahead as we propel forward to achieve our growth ambitions and delivering exceptional customer experiences."

Executives are said to be concerned by the bank's historically low turnover levels. According to the FT, the current turnover at the group is about 5% each year, compared to an average of closer to 15% historically, citing a person familiar with the matter.

Sharon Doherty, chief people and places officer, said Lloyds needed to see higher turnover among its lowest performers.

According to Ms Doherty, the new approach would align Lloyds more closely with investment banks and other "high-performing organisations" that routinely review low-performing staff.

The Accord union, which represents a large number of Lloyds staff, acknowledged management's sharper focus on performance and productivity.

Ged Nichols, general secretary of trade union Accord, said: "This is why bank employees need strong trade unions. There has been an increased focus on performance in Lloyds Banking Group this year, with more use of structured support plans to help individuals who may be falling short of their performance objectives.

"We work hard to support individual members through these processes to help them keep their jobs, and we'll continue to do so."

He added that the union was asking Lloyds to "reassure its staff that it will continue to uphold the integrity of the established performance management processes".

The shake-up comes after the Government recently announced a new package of reforms designed to reintroduce "informed risk-taking" to the UK's financial sector, which was stripped back after the 2008 financial crisis.

Chancellor Rachel Reeves said companies ought to avoid "excessive caution" and strive for growth and investment.