Retrenchment in Rwanda commercial banks analysis of BPR - I & M : Study period : 2011-2016.

Abstract

This study entitled the retrenchment in Rwanda commercial banks. A case study of BPR and I&M. Comparative data have been used. The companies that were study included all those that are commercial banks and specifically BPR and I&M bank. The objective of the study was; to examine the criteria used by BPR and I&M bank in employees retrenchment; to evaluate employees perception on retrenchment criteria used by BPR and I&M Bank; to examine the impact of retrenchment on individual and organizational performance and to establish the best ways of carrying out retrenchments in future without adversely affecting the remaining employees in both BPR and I&M Bank. The research design was quantitative and entirely used secondary data and qualitative including interviews from different staffs. These criteria therefore included BPR and I&M bank only. Data gathered was from 2011to 2016 analyzed using Excel and SPPS to measure the criteria used by Rwanda commercial bank in employees retrenchment. The findings of the study suggest that commercial banks use seniority, employees‟ individual productivity, misconduct, incapability, early retirement programs and employee obsolescence as criteria for determining employees to retrench. The criterion that is most popularly used is assessment of employees‟ individual productivity. Misconduct as a criterion for retrenchment is also popular and some of the behaviors that banks consider as misconduct include fraud, insubordination, regular unauthorized absenteeism, financial mismanagement, leaking out confidential information among others. Early retirement programs are also used to a moderate extent. Last in-First out (LIFO) is used to a moderate extent while incapability as a criterion is used to a less extent. It was also found that all banks use the same criteria despite their age, ownership and size.