Solidarity demands 'reckless' Telkom retrenchments be put on ice

Union Solidarity said in a statement on Thursday that it sent a letter to Telkom asking for a moratorium to be placed on what it called "forced retrenchments", which could potentially see 3 000 jobs cut.

Telkom issued a Section 189 notice to start the process of consultation to restructure its business, citing a need to gear the company for future competitiveness.

Solidarity CEO Dirk Hermann said in the statement that there was no evidence that cutting thousands of jobs could secure Telkom's financial stability and that rather, the evidence pointed to such a move potentially having the opposite effect.

'Reckless, merciless'

"A company cannot pay its executive team more than R100m and then get rid of 3 000 of its workforce. That is reckless and, given the labour market retrenched workers have to face, it is merciless. In the previous financial year Telkom’s CEO, Sipho Maseko, alone took home a full R23m," Hermann.

Hermann said the plans to retrench confirmed that the company had failed to retrain staff so that Telkom could grow faster in areas such as mobile services, at the expense of employees who had helped the company develop to its current level in the first place.

"When a company fails to train its workforce for new challenges, it should not retrench the workers; it should get rid of the top management. A further 3 000 jobs being cut are too many. If staff numbers need to be reduced further, it can be done by means of voluntary processes and natural staff turnover," Hermann added.

Telkom spokesperson Mooketsi Mocumi told Fin24 via email that while the company came to the decision to retrench, it would only have clarity on the final numbers once the consultation process with unions was complete.

He said the decision to enter initiate the Section 189 process came as a result of a weak economic environment and Telkom's declining performances in the fixed voice business, which previously made up more than half of Telkom's gross revenue. He said Telkom's fixed data also took a knock due to migration to mobile data.