Telkom's renewed cost-cutting process of condensing its workforce has again raised the ire of associated unions, which say they will fight for their members to remain employed.
Telkom yesterday announced a voluntary process whereby employees in management and its bargaining unit could apply for severance and early retirement packages. The telecoms company has a staff complement of 21 217, of which 2 600 operate in management (Telkom's September 2012 financial report).
The company said a retrenchment process would follow, should the voluntary offer not yield the desired results. Employees have until the end of August to apply for separation or early retirement and each case, says Telkom, will be assessed on its own merit.
This comes amid pressure for Telkom to grow revenue, and efforts by communications minister Dina Pule and an inter-ministerial committee to come up with options that will save the company, which is central to SA's telecoms landscape.
The announcement followed shortly after a meeting was held between Telkom and the three recognised trade unions associated with the company ? Solidarity, Communication Workers Union (CWU) and the South African Communication Union (SACU). Telkom says its bargaining unit is largely represented by these three labour outfits.
Union backlash
Trade union Solidarity was first to voice its concerns yesterday, saying it was "concerned" about Telkom offering packages to staff members. The union immediately started engaging with Telkom on the matter following the meeting and announcement yesterday.
The CWU said it would stick to its guns, citing its general stance on retrenchment - "it is unacceptable".
National spokesperson Matankana Mothapo says the union will not allow the retrenchment of any of its members. "Nice words" like voluntary retrenchment and severance packages, he says, do not hide the fact that letting workers go is retrenchment. "We will fight it."
SACU president Michael Hare says the unions feel let down by Telkom, which - in their view - did not follow due process.
Hare says yesterday's meeting with union representatives was merely an "information-sharing session" under the guise of it being a restructuring forum.
"We don't feel the company consulted sufficiently with us. They treated us with disrespect [and] pushed their announcement down our throats, without informing us as to what criteria they will use to determine which employees go, and which don't, and without any figures or budget on the table."
While Telkom says it carried out the necessary consultations and followed due process, Hare says unions were "shocked" by the announcement and felt they had been caught unawares by what he terms "reckless" engagement by the company.
Necessary pruning
The latest development mirrors the previous voluntary retrenchment process Telkom carried out during 2010 and 2011, which saw an already strained relationship with the three trade unions fractured further.
In 2010, Telkom voluntarily retrenched 186 managers, which cost the company R144 million in the half-year to September.
Telkom CFO Jacques Schindehutte said last year that Telkom had 15 months in which to show progress in revenue growth, or face significant cost interventions.
Schindehutte said it was necessary for Telkom to slash costs and address labour productivity. He said the company was working with unions to retrain staff and management, and that employees had to up their game to ensure return on investment.
At the time (about nine months ago), outgoing CEO Nombulelo "Pinky" Moholi said Telkom needed to focus on growing its business, rather than on staff cuts. Moholi is set to leave the company in May, after cutting her contract short with the submission of her six months' notice in November last year.
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