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Canada’s Administration Reacts on RBC Outsourcing Controversy
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The recent controversy over the Royal Bank of Canada employing U.S. outsourcing company iGate led to a storm of reactions on the internet after it was revealed that iGate used temporary foreign worker visas to replace dozens of staff at the bank’s investor services division in Toronto.

While iGate is known to have complied fully with all local regulations, the waves of public opinion had their intended effect on both the administration of the country and the administration of the Royal Bank of Canada.

On Thursday, Canada’s Prime Minister Stephen Harper said that the purpose of the temporary foreign worker visa program was to relieve acute and temporary labor shortage and not to replace Canadian employees with foreign workers. Harper also said that the government would make sure there was no abuse of the program.


Admitting the need of the foreign worker visa program in Canada, Harper said, “The reality is in this country … there are occupations and there are circumstances where there is an absolute labor shortage and certain employers need to find workers from outside the country … But this is not supposed to have a purpose beyond that and we will make sure it is not used for purposes beyond that.”

On Thursday itself, the Royal Bank of Canada, which is Canada’s largest public company went into damage control.

RBC Chief Executive Gord Nixon published an “Open Letter to Canadians” promising that employees affected by the outsourcing arrangement would be offered comparable job opportunities in other divisions of the bank. However, Nixon also stressed that the outsourcing had been done in compliance with all local laws and regulations.

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In his open letter, the RBC chief said, “I want to apologize to the employees affected by this outsourcing arrangement as we should have been more sensitive and helpful to them … We are reviewing our supplier arrangements and policies with continued focus on Canadian jobs and prosperity.”




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