Citizen Reporter
3 minute read
20 Jan 2020
12:41 pm

Telkom is retrenching thousands of workers despite execs making millions – CWU

Citizen Reporter

The union wants Finance Minister Tito Mboweni to step in and stop the proposed retrenchment of between 3,000 and 6,000 workers.

Communication Workers Union (CWU) secretary general Aubrey Tshabalala on SABC News. Picture: Screenshot.

Communication Workers Union (CWU) secretary-general Aubrey Tshabalala has expressed doubt over state-owned telecommunications company Telkom’s reason for retrenching thousands of employees.

Last Wednesday, it was announced that had written letters to unions that it may have to retrench thousands of staff, putting the total at roughly 3,000 people.

Then on Friday, the Federation of Unions of South Africa (Fedusa) said that Telkom has more retrenchments on the cards and will be axing 3,000 more employees from May, taking the total to 6,000.

Following the initial announcement of the proposed retrenchments last week, the company said it would need to let roughly 20% of its workforce go due to market conditions, regulatory uncertainty and an overly competitive environment.

Tshabalala, however, accuses the company’s top execs of getting rich as a result of retrenching workers.

“As the CWU, we find the presentation by the company ridiculous and undermining not only workers, but the country at large,” he said.

“In 2016, the company presented almost the same reasons to cut over 2,000 jobs and further outsourced thousands more jobs.

“The executives of Telkom rewarded themselves in 2018 with a total sum of R153.9 million for dismissing workers, and then claimed the company made profits,” he continued.

According to Tshabalala, Telkom has grown by more than 58% in the 2018/19 financial year due to mobile services, and subscriptions grew by more than 85% to 9.7 million subscribers.

“This was at a time when the company refused to reward workers with a decent salary increase. Instead, workers pocketed only 4% on average in a three-year cycle,” he said.

Tshabalala said government must shoulder some of the blame for the retrenchments.

“The CWU wants to know when the board took this decision, and who was present?”

READ MORE: Without mobile, Telkom would be in financial straits

“We all know [these networks] have been at the forefront of retrenching workers in the past years. Does this mean we have a government that supports retrenchments? The CWU is calling for an urgent meeting with the ruling party and the minister (Mboweni) to resolve this,” Tshabalala said.

Telkom spokesperson Mooketsi Mocumi says the company will meet with various unions on Wednesday to consult on what he describes as its “organisational review.”

He said the company would explain why the retrenchments, which were part of this “review process”, were necessary.

“In the process, facilitated by the Commission for Conciliation, Mediation and Arbitration (CCMA).

It was first reported last Wednesday that Telkom has written letters to unions saying it planned to lay off thousands of staff.

News broke on Wednesday evening that telecoms giant Telkom has written letters to unions that it may have to retrench thousands of staff.

A potential section 189 process could see at least 3,000 employees affected by restructuring, which is about 20% of Telkom’s 15,000-strong workforce.

The job cuts will primarily be around its Openserve business after Telkom announced last year it would decommission its copper network in favour of fibre. Its consumer business and wholesale division will be affected.

The telecoms firm has opted to move away from its legacy copper business in favour of more advanced, affordable tech.

Telkom’s shares have slumped from a major high of more than R100 last year. The price plunged to just R29.42 per share before recovering somewhat this week. The price is now at around R35.

(Compiled by Daniel Friedman. Background reporting, Charles Cilliers)

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