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Unions slam 'reckless' Telkom retrenchments

Publish date: 22 January 2020
Issue Number: 319
Diary: Legalbrief Workplace
Category: Labour

Unions have reacted angrily to the announcement of the current round of proposed job cuts at Telkom, writes Legalbrief. Trade union Solidarity has slammed Telkom over its plan to cut up to 3 000 jobs, or 20% of its 15 000-strong workforce, describing the cuts as ‘reckless’ in that they would ‘threaten the financial sustainability’ of the company. Tech Central reports that the union has written to Telkom asking for a moratorium on all forced retrenchments. Solidarity CEO Dirk Hermann said 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’. He described axing 3 000 employees as being ‘too many’. If staff numbers need to be reduced, this should be done through voluntary processes and natural staff turnover.

Full Tech Central report


An ITWeb report quotes Solidarity as saying retrenchments become necessary when the sustainability of a company is at issue, but this retrenchment round in fact threatens the company’s financial sustainability. The union points out the IT environment is highly competitive and skilled workers are scarce. The uncertainty Telkom is creating will merely result in the best workers leaving first, it says, adding this can lead to the company going into a downward spiral. ‘The message sent out by Telkom should rather be that loyal employees are appreciated. A moratorium on forced retrenchments will provide the security that Telkom employees now need,’ Hermann concludes.

Full ITWeb report

The Communication Workers Union (CWU) has called on the ANC and the government to step in. An IoL report says this follows Telkom’s distribution of Section 189 notices to its employees as it announced it was planning to restructure its business. In response, CWU general secretary Aubrey Tshabalala accused Telkom CEO Sipho Maseko and other top executives of making personal fortunes for themselves while they sent workers packing. He said the company’s revenue had grown by more than 58% in the 2018/19 financial year through mobile services, while its subscriptions grew by more than 85% to 9.7m subscribers. ‘This was at a time when the company refused to reward workers with a decent salary increase. Instead, workers pocketed only 4% on average in a three-year cycle,’ he said. Tshabalala said the government had to account for its role in the decision by Telkom. ‘The CWU wants to know when the board took this decision, and who was present,’ he said.

Full IoL report

The CWU, the majority union representing more than 50% of the workforce, has threatened to camp out at Luthuli House to stop the planned retrenchments. Business Day quotes Tshabalala as saying: ‘We are rejecting these retrenchments. We are deeply angered but we don't expect Telkom to back down, or for this to be a walk in the park. We expect this to be a serious war.’ Tshabalala said the collapse of state-owned enterprises was deliberate and aimed at benefiting a few individuals at the expense of workers and the poor.’

Full Business Day report

The Federation of Unions of SA (Fedusa) has called on the entire board of Telkom to be fired and replaced, a call echoed by the Information Communications and Technology Union. And, reports The Citizen, Fedusa said it had information indicating that more retrenchments would take place in May. The union’s acting general secretary Riefdah Ajam said outsourcing would lead to a further 1 000 retrenchments in May, and that Telkom’s IT subsidiary, Business Connexion, could let 2 000 people go in addition to this. While Telkom said it proposed the retrenchment of 3 000 workers, according to Fedusa it could be double this figure facing job losses.

Full report in The Citizen

The South African Federation of Trade Unions (Saftu) said in a statement on the Politicsweb site that it condemns in the strongest terms the decisions of Massmart to curl 1 400 jobs and close 13 stores. ‘In the same vein, we condemned the Telkom decision to bludgeon 3 000 workers. These workers join a long queue of workers sentenced to join the 10.3m unemployed South Africans and 63% of the population living in grinding and dehumanising poverty.’

Full report on the Politicsweb site

Telkom, last week, issued a notice to cut the jobs – nearly a third of its workforce – across multiple departments. Linda Senekal, Solidarity's sector co-ordinator, said in a Fin24 report the affected workers include those employed in the IT department, customer services and small business. With a 9 000-strong workforce, Telkom is adjusting to a shift in operating conditions, which have seen a significant move from voice to data, notes the report. The semi-privatised company, which operates in several countries in Africa, has also faced calls by Icasa to cut data costs. Senekal voiced concern that the company had opted to lay off workers instead of opting to upskill employees for tech-driven jobs.

Full Fin24 report