(Corrects to show Santander Spain staffing 50-60%, not roughly 35%, paragraph 6)
By Carolina Mandl and Tatiana Bautzer
SAO PAULO (Reuters) - Less than a month ago, Banco Santander (MC:SAN) Brasil SA had nearly 65% of its staff back at their offices, in contrast to Brazil's two largest lenders, who were keeping almost all of their employees working from home.
Now, under pressure from workers and health authorities wrestling to contain the country's worsening pandemic, the Brazilian unit of Spain's Banco Santander SA (NYSE:SAN) is telling more employees to stay home.
"There are no hospital beds left, so banks are sending workers back home" said Ivone Silva, head of the bank workers' union in the Sao Paulo region. "After a lot of pressure, Santander reduced the number of employees in their offices to about 30%."
On Wednesday, Santander said in a statement to the union it will further reduce the size of the teams working at its Brazil headquarters, but did not disclose by how much.
Santander Brasil declined to comment on Silva's assertion that the move was taken under pressure.
In Spain, a third wave of the pandemic also forced headquarters to send workers home again, reducing office staff to 30-40% in January and February from 50-60% in December. Staffing has since returned to December levels, a spokesman said.
Santander Brasil's retreat is the latest sign of a tension between Brazilian companies' eagerness to re-open offices and the growing risk of contagion as the country's COVID-19 crisis worsens.
In another case, Banco BTG Pactual SA, Latin America's largest independent investment bank, in recent weeks retreated from an effort to return 30% of staff to its Sao Paulo headquarters, reducing that to just 10%, Mateus Carneiro, BTG partner and head of Human Resources, told Reuters.
Even with health protocols in place at the office, remote work is "unavoidable" at the moment, Carneiro said, citing high infection rates and the overwhelmed Brazilian health system.
Those working at the office are tested twice a week, Carneiro said, and social distance from colleagues.
"We expected to be in a different situation now, but now it's a safety issue," he said, adding that the bank hoped to have just 15% to 30% of its 3,800 employees working remotely in the longer term, as it considers physical presence important for mentoring young employees and investment banking activities.
In a sign of broader sentiment against the idea of working from home, Brazilian President Jair Bolsonaro, who for months played down the pandemic, called "unacceptable" outgoing Petroleo Brasileiro SA Chief Executive Roberto Castello Branco's practice of running the oil company remotely.
"We still have some companies with a very controlling management style, that want their employees close by," said Tatiana Iwai, a professor specializing in work culture at the Insper business school, referring to mid-sized Brazilian companies.
Santander Brasil Chief Executive Sergio Rial has been an outspoken critic of working from home, saying it prevents dissemination of the company's culture.
"I don't see this as a great revolution," he said on one conference call. "It's no panacea, nor something transformative as you might imagine."
Banks are among Brazil's largest employers and 450,000 people work for financial institutions in jobs ranging from tellers to traders and investment bankers.
Banco Bradesco SA and Itau Unibanco Holding SA have kept 94% and 97% of employees working from home. CEOs for the banks said earlier in March they had no estimate for a return to the office, but they are planning to adopt part-time remote work when the pandemic is over.
In Europe, HSBC, Lloyds (LON:LLOY), Nationwide Building Society and Santander UK have said they will slash office space and combine working from home with offices.
At the same time, Santander and Itau in Brazil failed to follow a government suggestion that they open their branches less than five hours per day, the union said, adding that most banks cut their branches' working hours by one hour, but some slowly returned to longer hours.
In a note to clients on Wednesday, Santander said it would temporarily close some branches for the next two weeks to help curb the spread of the virus and cut working hours by one hour. Itau also said in an e-mail to Reuters that branches will close an hour earlier starting on Friday.
(This story corrects to show Santander Spain staffing 50-60%, not roughly 35%, paragraph 6)