Telkom’s BCX in formal consultations over job losses of 800
BCX is speaking with the CCMA and numerous unions about possible retrenchments, as its pre-tax profits to end-March fell significantly
Telkom subsidiary, BCX has entered formal consultation with its trade unions and the Commission for Conciliation, Mediation and Arbitration (CCMA) on the possible retrenchment of about close to 800 of its 7,489 employees.
BCX CEO Jonas Bogoshi said in a statement that it was commencing a CCMA-facilitated consultation process with all the registered trade unions comprising the Southern African Customs Union (SACU), the Communication Workers Union (CWU), Solidarity, the Information Communication Technology Union (ICTU), UASA, the Media Workers’ Association of SA (MWASA), the National Union of Metalworkers of SA (Numsa) and General Industries Workers Union of SA (GIWUSA).
News that the enterprise-focused BCX was seriously looking at reducing its head count first emerged in September, and followed Telkom reporting a 19.2% fall in pre-tax profit to R3.15bn, in its results for the year to end-March.
Telkom said at the time that the weak economy had a severe impact on BCX’s performance, which had seen revenue fall 4.1% to R21.1bn, and earnings before interest, tax, depreciation and amortisation (ebitda) shrink from R4bn to R3.7bn.
Shortly after Telkom released its results in May, then BCX CEO Ian Russell, who was only in the job for about a year following the sudden resignation of Isaac Mophatlane, said he would be leaving his post and talking up another position in the group.
A former Gijima CEO, Bogoshi, who had joined as chief revenue officer in April 2018, then became CEO.
News that the group was going through a formal consultation on retrenchments came after Russell said in February that BCX would go through restructuring but was not considering “forced” retrenchments.
Bogoshi said the trading conditions are still difficult: “Our business has been severely impacted by the technical recession. We expect the reduction in IT spend that we have seen to continue as our customers look to find ways to protect their own profitability.”
Telkom’s full year results are scheduled to be released tomorrow.