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MTN in staff backlash

Nicola Mawson
By Nicola Mawson, Contributor.
Johannesburg, 12 May 2015
The Communication Workers Union is behind call centre workers taking MTN to task.
The Communication Workers Union is behind call centre workers taking MTN to task.

MTN - which is restructuring its enterprise unit - is fending off a staff backlash as call centre staff threaten to strike, and former employees finally win a five-year-old legal fight.

A potential strike has raised concerns that service could be disrupted to end-users at SA's second-largest cellphone operator with 28 million subscribers. MTN is also Africa's biggest mobile company, with 227.5 million users, and 22 000 staff across the group.

Last year, MTN retrenched 476 workers and is now in the midst of another restructuring process in its enterprise unit, although the company has said it does not plan to cut jobs.

However, several of its staff members are disgruntled with the company and have successfully sought a certificate to hold a protected strike via the Commission for Conciliation, Mediation and Arbitration (CCMA). This move, spearheaded by the Communication Workers Union (CWU), is over MTN's refusal to pay bonuses.

Threatened strike

The customer service agents are taking MTN to task over its refusal to augment the 4% of salary ex gratia payments to which it conceded. MTN has explained bonuses were not allocated because MTN SA did not deliver the required level of growth and was not able to declare a performance bonus. Customer consultants usually get around 30% of their annual salary in bonuses.

ITWeb understands the strike action was set for today, but by mid-morning had not started, nor had the company been informed that a strike would happen today. A 48-hour notice period is required before workers engage in industrial action.

MTN group executive for corporate affairs Chris Maroleng would not comment this morning, but previously noted MTN is aware of the concerns of some staff and it has taken note of the CCMA's permission for protected strike action. He added the company is confident it will arrive at a constructive resolution to the impasse.

Lengthy fight

In addition to the threatened strike action, a group of former call centre staff have taken a legal battle all the way to the Labour Appeal Court to fight for their rights. The recent ruling, handed down by three judges, determined - because MTN was moving the entire call centre operation into its own business - it also had to hire all the call centre staff as its employees with effect from December 2010, which is when it stopped outsourcing the call centre.

At the heart of the dispute was an agreement between MTN and Interaction Cell Centre - in 2006 - under which Interaction would handle a KwaZulu-Natal contact centre for MTN. This call centre, one of the biggest MTN had nationally, was taken inside MTN in December 2010.

Although it appears from the judgement that MTN took over many of the staff, at least 47 call centre agents, the CWU and about 27 former employees took the matter all the way to the Labour Appeal Court to force a transfer of staff from Interaction to MTN.

The judges ruled MTN had to pay costs, and that all affected staff were deemed to have been hired by MTN from December 2010 "with no loss of service".

The CWU, which was not available for comment, has reportedly said the ruling would cost MTN dearly.

MTN SA's chief human resources officer, Themba Nyathi, says the company is studying the judgement, and, at this stage cannot eliminate the possibility of appealing.

Not desirable

Ovum analyst Richard Hurst says the number of disgruntled staff at MTN does not bode well for the company, which is currently seeking alternate revenue sources in a bid to beef up its top line. "The problem is the whole platoon is disgruntled."

Hurst notes the biggest threat to an organisation comes from within, and the staff action is clearly an internal threat that MTN needs to manage. He says, while MTN will overcome this speed bump, it will detract it from its core business, which it cannot avoid.

The "staff backlash" needs to be nipped in the bud before it spreads, adds Hurst, because the last thing MTN wants is unhappy staff who are not productive.

Tim Parle, telecoms specialist at BMI-TechKnowledge, adds - while industrial action is not unique to telcos - these moves are concerning and MTN will have to do "damage control" to deflect the heat.

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