Former Prospera Credit Union employees described the recent dismissal of over 100 employees as a “purge” following its merger with Westminster Savings Credit Union at the beginning of 2020.
The merge became official on Jan. 1 following the approval of the B.C. Financial Institution Commission, 18 months of negotiations and a previous failed attempt in 2015. The merger required the vote of two-thirds of the membership in November.
“The new executive of the company engaged in a lengthy process of misleading the individuals who worked for the company prior to the amalgamation being approved through a vote,” claims one former employee. “Had there been any indication that there would be significant layoffs, the vote would be negative.”
Ex-employees at Prospera – who spoke anonymously due to signing non-disclosure agreements in their severance packages – said that upper management assured them the joining of the two financial institutions was a “marriage of equals” with little overlap in branch networks, and no significant staffing changes were planned.
The employee said that prior to the merge, staff were told that both Prospera and Westminster Savings executives would be equally represented in the organizational structure of the new institution.
The day after the formal joining of the credit unions, two of the three Prospera executives were removed and replaced by Westminster Savings executives, according to the employee.
“Immediately the tone was set that this was now a takeover,” the employee said.
Five out of seven members on the executive board are now from the ranks of Westminster Savings, with only one from Prospera.
Two of three Prospera locations in Abbotsford – where the original Prospera was founded in 1948 and based its operations – remain closed, along with offices in Chilliwack and Vancouver.
The company says that staffing reductions were inevitable because of the merger, but attempts to stave off the cuts were unsuccessful because of the COVID-19 pandemic, an economic downturn and a significant drop in interests rates.
“Our commitment to our employees has always been to keep them well-informed,” said Jeff McDonald, communications manager at Prospera Credit Union, adding the organization “provided regular updates.”
McDonald said the company’s need to make “tough decisions” was openly communicated with its employees following the merger, and the possibility of layoffs were communicated in early May.
But former employees claim there was little-to-no communication from management about the possibility of layoffs prior to the merge.
“Did they clearly communicate? No. Absolutely not. This came completely out of the blue,” one employee said.
The employee believes the merger vote was largely influenced by staff, who spoke positively about the move to their members.
Another employee described being “blindsided” by the news of termination on May 20. They said management at the office was communicating that they didn’t need to be concerned about COVID-19 affecting their job security in March.
“I could understand if they wanted to lay us off because of COVID-19, but they straight terminated us,” the second employee said. “I went into work and a couple minutes [after I arrived], I was pulled into an office and I was pretty much told to pack my things.”
The term “layoffs” being used for describing ex-Prospera employees is not accurate, according to Lia Moody, employment lawyer and managing partner at Samfiru Tumarkin, a Vancouver-based law firm.
She said her firm has spoken to between 10 to 15 former staff who have all been “terminated without cause” – meaning the company does not plan on re-hiring them and are obligated to immediately pay out severance packages.
“My understanding is that all of them have employment contracts on which Prospera is relying to limit what their entitlements are on termination. Some, I think are challengeable under law,” Moody said.
The former employees said that some staff working from home were terminated through an automated voice message from the company if they missed the initial phone call.