South African Labor Union in Court Bid to Stop Telkom Job Cuts
South African Labor Union in Court Bid to Stop Telkom Job Cuts
A labor union is trying to prevent Telkom SA SOC Ltd. from continuing with a plan to cut as much as 20% of its workforce to cope with falling sales in its landline business and a weak South African economy.
The Communication Workers’ Union and Telkom will appear in the Labour Court at 10 a.m. local time on Wednesday where the case will be heard, the union and Telkom said in text messages. Telkom is rushing the process and hasn’t considered other alternatives to job cuts that could affect as many as 3,000 employees, the CWU said.
The former monopoly started the consultation process with labor unions in January after a declining performance in its fixed-voice business, which previously made up more than half of gross revenue. Its fixed-data unit is also suffering because of a migration to mobile data, the Pretoria-based company said, adding that it trying to achieve “organizational and operational efficiencies.”
South Africa’s economy is stuck in its longest downward spiral since 1945 as President Cyril Ramaphosa struggles to push through reforms needed to spur growth. Power cuts, delays in policy implementation, deteriorating public finances and the threat of South Africa losing its sole-remaining investment-grade credit rating dragged business confidence down to the lowest level in 34 years in 2019.
To contact the reporter on this story: Loni Prinsloo in Johannesburg at lprinsloo3@bloomberg.net
To contact the editors responsible for this story: Stefania Bianchi at sbianchi10@bloomberg.net, Vernon Wessels, Jacqueline Mackenzie
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