Citizen Reporter
2 minute read
20 Jan 2020
12:55 pm

Telkom is going to retrench 6,000 workers in total, not 3,000 – Fedusa

Citizen Reporter

The federation says Telkom could retrench another 1,000 workers in May, while its IT subsidiary, Business Connexion (BCX) could shed 2,000 jobs.

The Federation of Unions of South Africa (Fedusa) has called on the entire board of state-owned telecommunications company Telkom to be fired and replaced, with the Information Communications and Technology Union (Ictu) also calling the board to be disbanded.

While Telkom said last week it proposed the retrenchment of 3,000 workers, according to Fedusa it could be double this figure facing job losses.

Fedusa said it had information indicating that more retrenchments would take place in May.

The union’s acting general secretary Riefdah Ajam said on Friday that outsourcing would lead to a further 1,000 retrenchments in May, and that Telkom’s IT subsidiary, Business Connexion (BCX) could let 2,000 people go in addition to this.

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 around R35.

The company said the retrenchments would be necessary due to market conditions, regulatory uncertainty and an overly competitive environment.

The telecoms firm is also grappling with organisational and operational inefficiencies linked to fixed voice and data services, which require more staff to install, maintain and market, it said in a letter to unions seen by Reuters.

(Compiled by Daniel Friedman)

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