Telkom forced to give employees early retirement packages
CAPE TOWN - Telkom employees will be offered 'voluntary separation packages' and 'voluntary early retirement packages' to those that qualify from today.
Employees were told of the news via email, according to a number of media houses.
"We estimate that Telkom has subsidised the South African mobile industry by about R70 billion since its inception. This subsidy has mainly been a result of regulatory decisions that impacted Telkom disproportionately,” Telkom's email said.
“During these regulatory cycles Telkom has sought to safeguard jobs from market and economic pressures. However, the cumulative effect of past regulations continues to impact our business operations.”
It is therefore incumbent on Telkom to offer voluntary packages to all Telkom corporate, openserve, consumer and small Business employees.
In early August Telkom said Icasa's new plans to bring down call termination rates again would penalise Telkom more than its competitors.
"ICASA is proposing that fixed termination rates (FTRs) should fall by 70 percent compared with a reduction of only 31 percent in base mobile termination rates (MTRs) and that MTR asymmetry which supports new entrants should be reduced."
"This decision penalises Telkom much more than it does our competitors, although we are the smallest provider of mobile services in the market."
Icasa is awaiting comments on its new draft call termination rates, which were published on August 16.
“The effective date of the regulations, once finalised, will be 1 October 2018,” said Icasa.
Telkom said that this decision represents a missed opportunity to reduce the cost to communicate for the majority of telecoms users.
"It also disproportionately targets Telkom, as the champion in reducing the cost to communicate and the largest employer in the industry. While Telkom employs 18 000 people, the two largest mobile operators together employ 10 000 staff in total", said Telkom.
According to Telkom, their operations and structure are very different from that of the other mobile operators.
"We maintain a national network with around 1 900 exchanges. We use the revenue that we generate in dense urban areas (including termination revenue) to support services in rural areas of the country. Icasa’s proposal would undermine our ability to sustain rural services," said Telkom.
Business Report has reached out to Telkom for more information but could not get in contact with the media laison.
This is a developing story.
– BUSINESS REPORT ONLINE