In a move that has been widely anticipated, Telecom has today announced job cuts of between 930 to 1230 staff.
“Telecom expects to reduce its number of full time equivalent employees from 7530 at 31 December 2012 to approximately 6300 to 6600 by the middle of this year,” Telecom says in a media statement.
“Staff levels are being reduced by constraints on recruitment activity, voluntary and involuntary redundancies and the transfer of roles to other employers associated with portfolio rationalisation decisions."
Telecom expects to incur one-off restructuring costs of $70 million to $80 million.
“This is an important step to build a leaner, more agile organisation with a competitive cost structure, setting us up to win in the market,” says Telecom CEO Simon Moutter.
The company says the reduction in head count has been made as a result of three decisions.
- to reset the scope of Gen-i Australia to its original rationale;
- to reduce significantly corporate centre functions in management, HR, Finance, Legal and Corporate Relations; and
- to tighten the management and operational staff levels in all business units.
“The flow on impact of these changes onto revenues and non-labour operating costs is uncertain. Telecom believes that payroll costs (opex and capex) will reduce by $90 million to $110 million on an annualised basis,” the statement says.
Telecom is not ruling out further redundancies and says it will provide a second update "once decisions are taken".