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MTN says retrenchment process is a part of transformative journey

A worker sweeps past an outlet of South Africa's MTN Group in Johannesburg. Picture: REUTERS, Siphiwe Sibeko.

A worker sweeps past an outlet of South Africa's MTN Group in Johannesburg. Picture: REUTERS, Siphiwe Sibeko.

Published Aug 5, 2022


South African telecommunications giant, MTN, has said the retrenchment process it started was a part of the company’s transformative journey.

On Friday, trade union Solidarity hit out at MTN’s planned retrenchment process, saying MTN's management was acting callously and immorally by announcing retrenchments while the company’s financial figures were indicating a huge success.

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MTN, however, lashed back at the union and told Business Report the company had embarked on a transformation journey in 2020 to ensure the business and its people could evolve and thrive in the rapidly changing industries of telecommunication and technology.

“The MTN transformation focuses on shaping an organisation and talent base that is fit for the future, with a focus on creating new jobs, new capabilities and refreshing skills for the future, Leigh-Ann Chetty, senior manager: Communication and Public Relations at MTN told Business Report.

Chetty said MTN was creating more than 450 new jobs in digital, technology, financial technology, wholesale and enterprise spaces.

She added the reshaping of certain departments was requiring some employees to apply for revised or new roles.

“Last week, employees in MTN’s finance department were formally notified of the transformation process through the Section 189a process. The communication serves to legally inform employees that a transformation process is under way that may have an impact on some roles. A total of 173 impacted people will be required to apply for the 205 new or changed roles. Some roles will be outsourced,” Chetty said.

“It is important to note that this transformation journey has been under way for two years. It is disappointing that Solidarity has chosen to adopt an untrue and purposefully alarmist narrative, that seeks to create an entirely false link between a project that has been running for two years, with a potential acquisition (of Telkom) that is in the most embryonic of stages.”

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The two companies confirmed in July they were in early talks of MTN taking over Telkom.

Both companies said the discussions were about MTN acquiring the entire issued share capital of partially state-owned telecommunications provider, Telkom, in return for shares or a combination of cash and shares in MTN.

If the deal goes through, this means MTN will have to buy out the government as it holds a 40% stake in Telkom, while the Public Investment Corporation (PIC) owns a further 14% of Telkom’s equity.

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“Our people are the backbone of our business and, in this current tough economic climate, retrenchments will remain a very last resort. Our focus will be on reskilling, upskilling, deployment into other areas of the MTN group, as well as possible external business partnering. This sort of callous fear mongering is insensitive and unfair to a process that seeks to build for the future in an inclusive and innovative manner,” Chetty said.