Trade union Solidarity claims Telkom plans to implement a large-scale process of restructuring soon.
"Even though Solidarity has not received a section 189 notice from Telkom yet, the company's management informed the trade union that it is planning on restructuring its field force division. As many as 10 000 employees could possibly be affected by the process," says the union.
At the end of March, Telkom had 19 800 employees. Solidarity says it expects a notice today from Telkom about the retrenchments amid unions' fears that the restructuring process would continue this year, affecting rank and file employees.
Telkom's most recent restructuring, which affected management level, saw it send letters to 2 635 management staff last May. The letters told the staff they may be affected by a retrenchment process that could be in the offing, because of its "unsound" financial situation.
The letter explained the telco is in an "unsound" financial state, facing increasing costs and dwindling revenue, despite its previous bids to cut costs - including 2013's voluntary retrenchment and early retirement process. It notes Telkom wants to implement a flatter management structure, which could lead to some staff being out of work.
At the time, Telkom explained it "intends to reduce the management layer by about 25% by the end of the process," which put the number of jobs on the line at around 650. So far, about 300 managers have left the company.
Telkom was not immediately available to comment, but it noted last week that "the current market-related ratio of staff expenses to revenue for Telkom is still significantly below industry benchmarks. Some of our competitors have achieved more optimal staff expenses to revenue ratios.
"What is required is a more market-related ratio of staff expenses to revenue. Telkom's target is to achieve a ratio of 25% in five years. This will be a process undertaken over some time and will be aligned to the new organisational structure and business requirements."
The telco added it will review performance as well as areas for potential improvement or optimisation.
"This will be undertaken with all required engagement and consultation. It is too soon to put any definitive timeframes in place as the areas for potential review are still being studied. Telkom consistently review ways to optimise our business, in line with current market dynamics and our current environment."
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