Trade union, political party march to halt job cuts at Cell C
The battle for jobs at Cell C is continuing, with the majority union threatening to close all stores if the proposed retrenchments are not halted.
The Information Communication Technology Union (ICTU), which represents 60% of staff, together with political party, African Democratic Change (ADEC), yesterday marched to Blue Label Telecoms’ offices in Sandton, protesting the mooted redundancies. Blue Label is Cell C’s largest shareholder.
The battle began when Cell C bosses announced thousands of redundancies, equalling up to 40% of the entire workforce, in June.
The union has been resisting the move to retrench people, while the company is pressing ahead with its plans, citing right-sizing of the business as the reason for the retrenchments.
Cell C put in place a turnaround strategy in early 2019 and it says one of the pillars of the strategy is a focus on operational efficiencies.
To date, it says efforts to streamline the business have included cost savings through procurement cuts, a year-long hiring freeze, a review and discontinuation of certain product offerings, all in an effort to turn the business around.
According to Cell C, over time the operating model has resulted in several inefficiencies and there is a need to right-size the business and reduce the headcount to ensure the company is competitive and sustainable.
Furthermore, the debt-saddled mobile operator announced plans to close down 130 stores across the country as financial pressure continues to ravage the company.
However, the ICTU believes the redundancies are not warranted and must be stopped.
Origenous Mogoatlhe, ICTU deputy president, says: “We met with Etienne De Villiers, head of legal services at Blue Label, and he addressed workers. As a company, they promised to write a letter to Cell C instructing them to halt the retrenchments. He promised to copy us the letter. They have until 4pm today. If they fail, we will do what unions do. We will shut down premises until they listen.”
Blue Label referred ITWeb to Cell C for reaction as the matter pertained to the telco.
In response, the mobile operator says: “Cell C is lawfully restructuring its business in terms of Section 189 of the Labour Relations Act.”
The impasse has also drawn in ADEC, led by Visvin Reddy, which marched in solidarity with the ICTU and is demanding Cell C CEO Douglas Craigie Stevenson and board chairman Joe Mthimunye suspend the retrenchments.
Last week, Reddy called the retrenchments “insensitive, unpatriotic, self-serving and profit-focused”.
The telco has under-performed and recently stated it incurred R33 billion in losses over the years.
However, a recapitalisation programme is on the cards to try rescue the business.
In May, the Competition Commission recommended conditional approval of the proposed acquisition of certain Cell C assets by special purpose vehicle Gatsby SPV, but the deal is yet to be concluded.
Blue Label says the telco will be recapped this year as the key partners have made huge inroads in negotiating the funding deal.