The RECORD: WATERLOO REGION — At first, Michelle Jarrett and Marion Burgdorf thought their bosses were doing them a favour.
The two women worked as information technology security co-ordinators at the large Manulife Financial office in downtown Kitchener.
In those roles, they controlled access to the company’s software database for the 1,200 employees who handled individual life insurance policies in Manulife’s Canadian division, headquartered in Waterloo and with offices in Kitchener and Waterloo.
Jarrett and Burgdorf were also required to do monthly, quarterly and annual security reviews of the department.
But for several years, they were feeling overwhelmed. In their minds, handling software access for so many employees, including new hires, transfers and departures, was too much for two people.
Electronic files, documents and messages had to be cut off from employees leaving the department and opened to new people transferring in.
“They were many different pieces that they would get access to,” said Jarrett.
“This was always a constant juggle for us” said Burgdorf.
There was enough work to keep three to four people busy, they believed.
In May of 2011, they were initially relieved to learn that security reviews would be handled by Manulife’s office in Manila, Philippines. Two Manulife officials were dispatched from Kitchener to train the workers in Manila.
At first the new system worked reasonably well. The employees in Manila worked the same hours as the crew in Kitchener and everyone kept up to speed with daily conference calls and regular messaging.
But then, in October 2011, came unpleasant news.
Jarrett and Burgdorf — both single moms earning around $46,000 a year — learned they would lose their jobs at the end of January 2012. They were being replaced by four workers in Manila.
Their shock soon turned to anger and disbelief. Two of the Manila workers were coming to Kitchener and Jarrett and Burgdorf would have to train them.
“Nobody else could give them the in-depth training, except us two,” said Burgdorf.
“And they didn’t want to send us to Manila,” added Jarrett.
When the two employees arrived from Manila for two weeks of training in January 2012, Jarrett and Burgdorf received a stern warning: sabotage the training in any way and they would lose their severance payments.
“I stuck to the letter (of the training). Exactly what they said,” said Burgdorf.
The two women didn’t blame the Manila workers for their plight.
“They were very nice. It wasn’t their fault,” said Jarrett.
Since losing their jobs on Jan. 31, 2012, the pair landed on their feet.
Burgdorf was hired soon after at OpenText in Waterloo and Jarrett enrolled at Conestoga College to train as a personal support worker.
But they were moved to speak out about the growing trend of Canadian companies outsourcing jobs overseas to access cheaper labour, and the recent controversy at RBC where workers in Toronto were required to train their replacements from India.
Jarrett and Burgdorf stressed that they know of no other instances at Manulife where workers in Kitchener and Waterloo were forced to train replacements brought here from overseas.
But they did notice a growing tendency within the company to transfer local jobs to offshore locations, including the Philippines.
Manulife employs around 3,800 in Kitchener and Waterloo of the 8,400 in Canada and about 27,000 globally. Its global headquarters is in Toronto.
Starting in 2006, roughly 20 jobs in the policy-change department in Kitchener were moved offshore, followed by another 50 or so in 2008 in the new business department, Jarrett and Burgdorf said. In 2010, more jobs in both departments were outsourced, they said.
“It was just getting larger and larger,” said Burgdorf.
And it didn’t stop there.
“Wealth management was doing the same. Distribution was doing the same. They were all making that move,” she said.
“They started in 2006 and they saw how it was going to work and they just started gradually moving different positions over there,” said Jarrett.
“We don’t how many (redundant employees) actually found other positions within Manulife or left,” she added.
In some cases, employees found more and more of their duties being stripped away and sent over to Manila until nothing was left, said Burgdorf.
Losing hands-on assistance was one of the biggest drawbacks of moving their jobs offshore, they said.
“We did a lot of one-on-ones, going up to the computers and actually trying to figure out where they (employees) were stuck on a screen, whereas they can’t do that when they’re in Manila,” said Jarrett.
Responding to questions about Manulife’s policy on outsourcing, company spokesperson Graeme Harris said two-thirds of the company’s operations are outside Canada and each region supports the other through information technology, disaster recovery and other operations.
“Canadian employees have been sent to the Philippines, where we have operated for more than 100 years, and Manulife employees from the Philippines have been trained in Canada,” said Harris, vice-president of communications and media relations.
The company doesn’t comment on individual situations, but “we always treat our employees with dignity and respect,” Harris said in an email Friday.
“We are committed to maintaining our headquarters in Waterloo and to growing our business and supporting the local community,” he added.
As for job cuts in general, Manulife has recently been reviewing its organizational design, he said.
“We have been reducing the number of management positions in order to eliminate duplication of infrastructure and improve the effectiveness of our decision-making,” Harris said.
But no jobs under the organizational design have been moved to other jurisdictions, he said.
Sun Life Financial, another financial services firm with a large presence in Waterloo Region, does not bring in workers from other countries on a temporary basis, said spokesperson Frank Switzer.
Sun Life has operations in 24 countries and some employees are brought here for training, he said in an email.
The company employs 15,000 people worldwide, including 2,700 in the Kitchener-Waterloo area where its Canadian head office is located, Switzer said. Over the past three years, Sun Life added 400 positions in this area, he added.
While large companies such as RBC have been criticized for their outsourcing policies, a recent study indicates that outsourcing IT jobs among large Canadian firms “has become mainstream and a commonly accepted practice.”
The percentage of large Canadian companies sending jobs overseas reached 40 per cent, says the study by the research firm IDC Canada.
Other local companies such as BlackBerry turned to outsourcing to streamline some of its operations and shore up its balance sheet. Last year, the Waterloo-based smartphone maker eliminated 100 jobs by outsourcing its IT service division to NCR Corp.
BlackBerry would not comment on whether it engages in outsourcing practices, except to say it previously announced job reductions of up to 5,000 people over the past year to balance its books.
“We have not specified the markets or departments affected. It is BlackBerry’s policy not to disclose agreements with partners or vendors,” the company said in a statement.