Banks across the world are in the midst of automating thousands of workers, but in Australia, the world’s biggest lender has been embarrassed into a climbdown. The Commonwealth Bank of Australia (CBA) has agreed to rehire 45 workers after it mistakenly laid them off for what it described as a “redundancy” due to artificial intelligence.

The dispute was brought by the Finance Sector Union (FSU), which filed a complaint against the bank for misleading its workers. The bank admitted its explanation to staff as to why they had been made redundant was “not accurate,” after it was challenged by the union, with some staff having served at the bank for up to 39 years.

The row erupted when the bank told dozens of staff that their roles had been rendered obsolete by its new AI chatbot. In a statement to the Australian Financial Review, CBA said “the recent introduction of a new technology, a voice bot, has significantly reduced our incoming calls by around 2,000 per week, allowing us to make a small number of roles redundant.”

The bank was hit with a complaint from the union, which contested the 45 layoffs because the reduction in call volume was not “temporary or fluctuating” as previously explained by CBA. It further alleged that, at the time it made the staff redundant, CBA was actually increasing call handlers, poaching managers to help answer the phones, and proactively offering overtime to existing call center staff.

The union took the complaint to the Fair Work Tribunal, where CBA made a surprising admission. In evidence to the tribunal, CBA stated “staff have advised of a period of increased call volumes that coincided with the selection of some employees for redundancy.” The bank added that “this error meant the roles were not redundant.”

Following this admission, the bank issued a formal apology to those staff made redundant, and said that workers would be given the chance to return to their old roles. They could also take up new roles elsewhere in the bank, or instead accept a severance package, the bank added.

The union that brought the case has taken it as a victory. “It’s a massive win for our members and a big win for the union and banking workers generally,” an FSU spokesperson told the Australian Financial Review.

The union added that it still found the whole experience deeply distressing to those affected, as the workers endured several weeks of uncertainty before being told their jobs were secure once more. “The damage has already been done,” a spokesperson told the publication. “People have been put under a lot of stress and anxiety, wondering where their next paycheck was going to come from.”

The bank still plans to double down on AI. The bank said this week that it would be partnering with OpenAI to “build generative AI tools in areas such as fraud and scam detection and financial crime prevention,” and to “deliver more personalized experiences” to customers. The partnership is based on fine-tuning models with data from the bank.

A CBA spokesperson told Bloomberg that it would be a “multi-year journey,” that the bank was focused on making AI work for its staff, and that this case was a valuable lesson in the need to consult on the responsible use of AI. “It is important that we fully understand the purpose, potential, and limitations of AI,” they said, “We’re embedding a responsible approach to AI into everything we do.”

Still, the bank is likely to be on edge in the face of the complaints tribunal, having accidentally found itself at the sharp end of a wider disruption to the banking industry. “We believe banks will cut 200,000 jobs globally over the next three to five years,” as chatbots and other forms of AI automate jobs across back office, middle office, and operations roles, Bloomberg Intelligence stated recently.