Royal Bank of Scotland is to reduce the pay of its IT contractors by 10 percent as part of ongoing cost cutting moves.
The majority of the bank's temporary staff across all departmerns — approximately 11,000 in total according to most recent figures — will have their pay cut from the end of the month after receiving a letter from the bank last week outlining plans. The cuts will impact all IT contract workers in various roles across the organisation, the bank confirmed.
The cuts will target all temporary workers paid more than £250 a day, although those hired through consultants will be exempt.
"We continually keep costs under review, in reaching this decision we have taken into consideration market day rates and those across the banking industry," said a bank spokesperson.
The announcement comes after Barclays put in place similar measures earlier this month, with IT contractors told they would receive a 10 percent pay cut or face losing their job.
Both banks are in the midst of major cost cutting programmes. RBS, which is 81 percent owned by the government, is attempting to make £1 billion savings this year alone and £5 billion by 2017. The cost reduction is part of a major restructuring that is expected to see the bank reduce its headcount by 30,000 in the coming years.
Meanwhile, Barclays is in the process of carrying out is 'Transform' programme, which is designed to help the bank reduce its net operating expenditure by £1.7 billion to £16.8 billion by 2015.
The bank announced earlier this year that it plans to cut between 10,000 and 12,000 jobs this year, including 7,000 in the UK. This will include 1,700 frontline roles which will go as the bank increases service automation.