Mobile operator MTN this morning refused to comment on media reports it is preparing to shed hundreds of jobs amid a two-month strike by Communication Workers Union (CWU) members, saying it will not respond to speculation.
However, labour unions are not excluding the possibility of looming retrenchments at the company, but say they have not yet been formally informed of any downsizing plans by MTN. The operator cut 476 jobs last year, while all 570 employees in its business unit had to re-apply for their jobs in January, as MTN needed to match the best skills with available positions.
According to a Business Day report this morning, the country's second-largest cellular provider is getting ready to trim jobs as the ongoing strike has shown the company it can operate successfully without a portion of its staff complement. This, says the newspaper, is according to a source close to MTN.
But Themba Nyathi, chief HR officer at MTN SA, would neither comment on the newspaper's reports, nor be drawn on whether more retrenchments are in the pipeline. "Should that be the case, we would first have to engage with the unions and our staff members before we can discuss retrenchments."
Nyathi suggests the speculation could be linked to reports earlier this year that the MTN Group is eyeing a deal with Brightstar, a US-based distributor of mobile phones and devices, to outsource its retail outlets in SA. At the time, it was reported the deal would see Brightstar take on the management of MTN's chain of retail stores and its local distribution and logistics operations. It is understood industry insiders believe up to 800 MTN jobs could be affected by the move.
Last month, Nyathi confirmed stock shortages at four MTN stores were a result of the company outsourcing its non-core operations, including its distribution process, and not as a result of the ongoing CWU strike.
"The strike has had a slight impact, like in the case where striking workers blocked the entrance to our Midrand warehouse. But the stock shortage was mainly due to a new distribution model that we started implementing just before the strike started," he said at the time.
Cautious approach
Meanwhile, despite the absence of any official indication MTN is mulling further job cuts, the CWU is approaching the situation with caution.
"We have not been consulted and [retrenchment] notices have not been issued to our members, but we are not ruling anything out, considering that this is MTN," says CWU secretary general Aubrey Tshabalala.
Solidarity trade union spokesperson Marius Croucamp also confirmed the union has not received retrenchment notices at this stage, and says it is difficult to say whether MTN is planning to cut more jobs soon.
"The unions have no bargaining power at MTN, so we are counting on our members to inform us when anything happens. So far, we have not received any information regarding retrenchments."
Meanwhile, Tshabalala confirmed the union is still on strike at MTN, adding it is still waiting for a response from MTN to its settlement offer. The union called a strike at MTN on 20 May, after it declared a dispute with MTN over pay increases and bonus payouts.
A few weeks ago, the union backed down from its earlier demands and confirmed it agreed to accept the company's 4% bonus payout in December and another payment of 8.33% in March 2016. It initially demanded a 30% bonus payout, before revising this to 16%, and finally conceding to accept the original 12% offered by MTN.
The CWU also backed down from its request for a 10% annual salary increase, accepting the company's policy of performance-based pay hikes would remain in place.
Share