Cell C may retrench senior executives

Samuel Mungadze
By Samuel Mungadze, Africa editor
Johannesburg, 11 May 2020

Some senior managers and executives at Cell C may lose their jobs, as the company has initiated a consultation process with the possibility of redundancy of certain positions and retrenchments.

The telco says this review of the management structure is based on a detailed analysis of the operating model and “organisational structure which revealed that the current structure has grown over time while the business has stagnated”.

This, it says, contributed to operational inefficiencies, silos and duplication of roles, as well as lack of clarity in terms of accountability for performance and unsustainable costs.

Cell C has, however, cautioned it has not taken any final decisions with regard to the contemplated retrenchments and “is currently in the consultation process with affected employees to obtain their input and reach joint consensus, under the facilitation of the CCMA in terms of section 189A (2) of the Labour Relations Act”.

The Act regulates the organisational rights of trade unions, and promotes and facilitates collective bargaining at the workplace and at sectoral level. It also deals with strikes and lockouts, workplace forums and alternative dispute resolution.

According to the company: “In early March 2020, Cell C initiated a consultation process in terms of section 189A (2) of the Labour Relations Act 66 of 1995, specifically at a senior manager and executive level, and advised employees of the possibility of redundancy of certain positions and contemplated retrenchments.

“In this process, the Information Communications and Technology Union represents only three employees.”

Cell C says under-performance over the years led to the implementation of a turnaround strategy in 2019.

“Part of this strategy included improving operational efficiencies, which included cost-cutting initiatives; procurement savings; renegotiated favourable exit terms on the unsuccessful content streaming platform, black; a freeze on additional non-critical hires; a review of the company’s product portfolio; and now, reviewing its management structure and complement to align to the new operating model,” explains Cell C.

The embattled mobile operator Cell C lost 2.9 million subscribers for the year ended December but was optimistic, saying the margin of its existing customers was better as a result of acquiring profitable clients.

Cell C posted further losses for the period, declaring a loss of R3.94 billion compared to R7.36 billion in 2018.

Notwithstanding the losses, Cell C CEO Douglas Craigie Stevenson was upbeat, saying the green shoots of the telco’s turnaround strategy, which was implemented from March 2019 onwards, were now visible.