One of South Africa’s largest telecommunications companies, Telkom has been ordered to abandon plans to retrench thousands of workers.
The order by the Johannesburg Labour Court was hailed as a victory for workers while Telkom said it was “disappointed” by the judgment.
Once the dispute is resolved we’ll continue with the restructuring and would now go back to the table with unions to share more information
Three unions at Telkom, namely, Solidarity, the Communications Workers Union and the South African Communications Union approached the Labour Court to argue that
Telkom had not fully consulted workers on the planned job cuts.
However, Telkom said it would continue with its restructuring exercise despite the court setback.
“Once the dispute is resolved we’ll continue with the restructuring and would now go back to the table with unions to share more information,” the company said.
The telecoms giant, once the lone operator in South Africa, plans to retrench and offer voluntary severance packages to over 4000 workers and place a further 3000 with different outsourcing companies.
Telkom argued that its core fixed line business has not been competitive due to technological advances.
Its business includes satellite, data, voice, internet, network solutions and LAN provisioning.
Telkom operates in more than 38 countries across Africa and is a semi-privatised, with the State holding a 39 percent stake.
The unions declared a dispute with Telkom in June over the planned retrenchments.
The dispute centres around different interpretations of a restructuring forum between Telkom and unions and what decision-making powers it has.
They launched a section 189 process which deals with retrenchments.
Telkom had argued that a restructuring forum was a pure information forum and not a decision making one.
Solidarity said it had not been given enough information on the job cuts.
Telkom spokeswoman Jacqui O’Sullivan told Business Day that the forum established in 2008 was neither a consultation nor a decision-making body, but was formed to share information.
The telecommunications company said after exhausting all avenues, it’s now offering voluntary severance and early retirement packages.
Telkom now competes against three mobile operators, Vodacom, MTN and Cell-C.
Telkom says ‘must continue’ with job cuts after court ruling
South African fixed-line telecoms operator Telkom said it had to eventually continue with its plan to layoff 4,400 staff after a court on Wednesday ordered it to halt job cuts until workers were consulted about the process.
Telkom, in which the government owns a stake of about 40 percent, is in the middle of a turnaround plan that aims to bring down costs and better compete with wireless operators MTN Group and Vodacom.
“It is a temporary delay. The restructuring must continue,” spokeswoman Jacqui O’Sullivan told the ENCA television station, adding that the company needed to cut 7,800 jobs on total.
Three labour unions had taken Telkom to court, arguing that workers were being left out of the process.
“The court ruling is a huge victory for us, because it gives us an opportunity to participate in the process,” Solidarity Deputy General Secretary Johan Kruger told Reuters.
“There is a possibility that there will eventually be job losses but by being able to participate in the process, we can try and save jobs.” Telkom employs about 18,000 people.