Volunteering, conscription and pay

As the war went on, banks’ attitudes to staff going on military service evolved, as did arrangements for paying them in their absence.

As soon as war broke out, men who served in volunteer battalions – sometimes called 'Saturday afternoon soldiers' – were immediately mobilised. Among them were many bank workers.

Others wished to volunteer as soon as possible, giving the banks no time to confer between themselves about how to handle this unprecedented situation. As a result, each bank’s board made its own decisions, and there was no consistency between banks in how staff were treated upon joining up.

All the banks wanted to be patriotic, but they could not afford to lose all their men at once. The government was relying on them to manage national resources, to maintain public calm and to support the economy’s transition to a war footing. This was no time to try coping with a heavily reduced staff.

Most banks made it clear at an early stage that employees needed permission from head office to join up. They wanted to take an overview of how many men had already gone from an office, and how many more could possibly be spared. London County & Westminster also took into account the applicant’s likely usefulness to the army, prioritising applicants who already had military training, and suggesting that those with no such experience would be doing more for their country by staying at work, where they had real expertise.

Nevertheless, by early September 1914 around 10% of bank staff had been given permission to join up. In one of our largest constituents, London County & Westminster, 283 men had already gone from a total of 3,250. Another 530 had applied, and were waiting for the bank to give its approval. 

The Derby Scheme

For the first year of the war, the army’s need for recruits was met wholly by volunteers. By summer 1915, however, the supply was slowing. Britain had a traditional distaste for conscription, but some kind of compulsion, or at least stronger encouragement, was becoming necessary.

In October 1915 the Derby Scheme, named after Lord Derby, Director-General of Recruiting, was unveiled. It offered men the opportunity to attest that they were willing to serve without having to go away immediately. Attested men were placed in groups according to their age and marital status, and the groups would then be called up when needed, prioritising single men over those who were married.

The scheme also established a system of tribunals, which reviewed applications for exemption from service, whether on grounds of pacifism or indispensability, either to family or employer. Even if a man did not wish to serve, he might attest, simply so that a tribunal could decide on his individual case. 

Throughout the autumn of 1915, the banks worried about how to respond to this new development. As of the end of October 1915, over 8,500 of Britain’s 30,000 bank workers had joined up. This figure represented around 46% of those in the eligible age range. The banks did not want to defy government initiatives, but were struggling to see how they could spare more men.

At first, some banks told staff not to attest, or at least to await further instructions. In Scotland, the banks petitioned the government for a quota system, whereby no bank would be required to give up more than 50% of its eligible pre-war staff. No concession was made, however, and by late November the banks began informing staff that they could attest if they wished. As the weeks went by, the banks strengthened their support for the Derby Scheme, and before long most of them not only permitted, but actively expected, their men to attest. Some announced that men who failed to attest would receive no pay if they were subsequently conscripted.

The initial Derby Scheme closed in mid-December. At a national level, it was largely seen as a failure, because although over 2 million men did attest, nearly 40% of single men and over 50% of married men still did not come forward. In the banks, however, the vast majority of men did attest.

Tribunals and beyond

The banks supported the Derby Scheme and encouraged staff to participate in it, but this did not mean that they wanted all their men to join up. On the contrary, their intention was to get all staff into the system, so that they could efficiently organise applications for exemptions, or at least postponements, where necessary. 

As soon as the Derby Scheme’s first phase closed in December 1915, they started preparing tribunal cases, highlighting particular men who had specialist experience or responsibilities that could not easily be taken over by someone else, and calculating the smallest number of trained men that could reasonably run a bank. It was agreed that banks could submit all their appeals to one local tribunal, in the place where their head office was based, rather than to the tribunal where each man was based.

The tribunals were reasonably sympathetic to the banks’ requests, and allowed banks to keep around half of their pre-war total staff. The City of London tribunal agreed, for example, to postpone by six months the call-up of over 600 men who worked for London County & Westminster Bank. In the ensuing six months, the proportion of London County & Westminster’s staff on active service rose from 38% to 50%, but without those exemptions, the figure would have reached 68%.

The first round of postponements expired in July 1916, but the banks were generally successful in having them renewed for a further six months. By January 1917, however, the tribunals’ postponement criteria were becoming stricter, and it was harder to retain men. Nevertheless, the postponements during 1916 had given the banks time to recruit and train more temporary staff.

Postponements did continue to be granted throughout the rest of the war, but they became fewer. Records do not survive to indicate how many men from across all our banks served during the war, but it was probably well over 10,000, of whom 1,584 died and probably over 4,000 were wounded.

Conscientious objectors

Men who refused to participate in the war effort on conscientious grounds – for example, because of pacifist beliefs – were known as conscientious objectors. In more recent decades, public opinion has grown more sympathetic to their position, but at the time, there was a strong view that their stance was a threat to the whole war effort, and deeply unfair to those who were doing their bit. Conscientious objectors met with widespread disapproval, and few people – including their employers – wanted to be associated with them.

In January 1916, for example, National Provincial Bank's chairman told the bank's AGM that of over 1,700 employees of military age, only 24 had not yet attested for military service. Those 24, he said, 'either have good reason no doubt for not doing so, or possibly they may be conscientious objectors!' 

Dismissive remarks of this kind were not the worst trial faced by conscientious objectors. Several banks made it a matter of policy to end their employment. Others were a little less severe. London County & Westminster Bank, for example, did not dismiss men at the time of their declaration of a conscientious objection, but did require them to resign when they were called away to work on the land as part of the terms of their exemption from combat. They were not entitled to the part-pay that staff on military service received, and were given no guarantee of reinstatement after the war, although the bank agreed that it would consider their cases when the time came, and in some cases reinstatement did indeed occur.

Wartime pay for bankers on military service

There was no consistency between the banks on arrangements for paying staff on active service. In the first weeks of the war, some declared that all clerks would continue on their full salaries, at least for the time being. One of our constituents, Williams Deacon's Bank, went so far as to state that this arrangement would continue for the duration of the war. By June 1915 it was forced to introduce less generous terms for any future recruits, but those who were already serving did indeed receive full pay for the rest of the war.

As the war went on, it became necessary for banks to revise their arrangements. As well as allowances to men on active service, they were paying wages to the women, boys and older men who were keeping the banks running in their absence, so were in effect paying twice for every worker.

Banks were keen that staff should not be left worse off by undertaking war service. One popular approach was to pay the difference between the man’s army wage and his bank salary. For example, a 19-year-old junior in one of our English constituent banks, fresh from his 3-year apprenticeship, would have been paid about £80 in 1914. If he joined the army as a private, his army pay would be around £18 a year, so the bank would pay him £62. After army pay was increased in 1917, becoming around £27 a year for a private, his bank pay would have fallen to £53. On the other hand, if he was singled out for promotion, he would be paid much more by the army. As a second lieutenant, the most junior rank of commissioned officer, he would be paid around £140 a year, rising to £190 or more by the end of the war. In these cases, most of the English banks imposed a half-pay minimum, so he would still receive £40 from the bank, in addition to his army pay.

It is worth noting, however, that in at least one of our largest English banks, men who joined the bank after the outbreak of war were not eligible for any pay at all if they subsequently went away on military service. By late 1916, this covered one in five of the nearly 1,700 men on active service from London County & Westminster Bank.

Scottish bankers were traditionally paid less than their English counterparts, particularly at the junior end of the scale. In the Royal Bank of Scotland in 1914, apprentices were typically paid between £10 and £20 a year. Even a junior clerk, with 3 years’ experience, could earn as little as £30. Scottish banks generally arranged to pay half salary to men on military service, albeit with extra provision for the lowest-paid in some cases. The junior clerk on £30, for example, would receive £15 a year from the Royal Bank of Scotland while he was on active service; in Commercial Bank of Scotland or National Bank of Scotland he would have received a little more, in recognition of his low wage.

The Irish banks' terms were even less favourable. The National Bank, which was headquartered in London but operated a branch network in Ireland, announced a succession of pay reductions as 1915 went on. In May, it declared that officers would receive half salary minus military pay. Two months later this provision was extended to men in the ranks, and officers were told they would receive nothing. By October, the bank declared that no staff would receive any pay at all while on active service. Perhaps this last announcement finally went too far and prompted objections, because the bank subsequently retreated from this policy, and settled on paying all staff, regardless of rank, half-salary minus army pay.