Personnel Decision Making of Chosen Czech Banking Subjects During the Economic Recession

The article focuses on personnel decision making of important banking subjects during the ongoing economic recession with the specialization on financial crisis in 2008. Main objective of the article is to verify the implicit contract theory and to answer the question of how the selected banks solve problem of reducing labour costs during the crisis. Four important banks (Česká spořitelna, a. s., Komerční banka, a. s., GE Money Bank, a. s., Raiffeisenbank, a. s.) in years 2005 - 2010 are examined. To identify the economic crisis, is used model, which is based on the model, indicating the U. S. business cycle, which uses analytical team in Raiffeisenbank. Model used in this article is based on three variables (index of industrial production, business sales, employment rate). Employment rate is separate variable. The values of business sales are adjusted to the values of basis indices, for which the year 2005 is the basis. The development of all those three variables (index of industrial production, business sales, employment rate) is similar and it is possible to determine the period from the graphical representation, in which all variables reached their maximum and reversed their trend. To support this, a trend line was added to the graphs. The trend line was determined as a moving average for the four seasons. Based on the model, the beginning of the economic recession was indentified to the turn of 2007 and 2008. The biggest slumps can be seen during the year 2009. The investigated periods are therefore the years 2008 and 2009.The calculations of other variables, describing the current condition of the studied subject, are adjusted to the values of basis indices in the same way as the business sales. The year 2005 is set as a basis. Data from chosen banks' annual reports were used to study their current condition. The basic monitored data are: labour costs, number of employees and earnings after tax (EAT). This article focuses attention on the personal decisions of banks, especially on the monitoring of costs of employees and their evolution over time in the context of economic recession. The essential conclusion is the confirmation of the implicit contract theory of the new Keynesian economics, which appeared at all observed subject. It is possible to see a year delay between the reduction of the employees and reduction of salary costs. This delay causes further costs. The reduction was observed in all subjects.