New BT Boss Gives Shares to Workers as Overhaul Starts to Bite

(Bloomberg) -- BT Group Plc’s new chief executive will give each employee 500 pounds ($641) in shares every year to get them behind his plans to overhaul the former monopoly.

Labor unions have complained of stress and low morale at Britain’s dominant phone company since it began to lay off thousands from its 100,000-strong workforce last May in an effort to simplify management.

About 4,000 staff have left out of 13,000 planned cuts. It has weighed even deeper layoffs as processes are streamlined and automated and some units are sold, people familiar with the matter have told Bloomberg.

“I’m asking our colleagues for their commitment to making BT a national champion,” CEO Philip Jansen said in a statement announcing the 50 million-pound worker shares plan.

Addressing reporters late Wednesday, Jansen said it was “damn obvious” that BT is still too slow, too fond of committees and needs better customer service more than three decades after it was privatized.

“The processes and the systems, they are such a nightmare,” he said. Employees are “all doing stuff, they’re all committed, but they’re doing stuff which is really really inefficient, so we have to redo the processes so they are relatively straightforward and smooth. And then automate the hell out of it.”

Jansen took charge in February after predecessor Gavin Patterson was ousted following a bruising accounting scandal in Italy and battles with Britain’s telecommunications regulator. Revenue is shrinking in every part of the company except its consumer division.

Jansen said BT had “lost its confidence a little bit” and its reputation needs repairing. He said employees told him that “if I go out in a bar, I probably don’t say I work for BT.”

To contact the reporter on this story: Thomas Seal in London at tseal@bloomberg.net

To contact the editors responsible for this story: Rebecca Penty at rpenty@bloomberg.net, Thomas Pfeiffer

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