The communications union says Telstra workers were “ambushed” by the telco giant’s shock announcement on Wednesday that it will sack up to 1400 employees in the next six months.
Telstra CEO Andy Penn said the cuts, revealed to workers on Wednesday, would affect most parts of the company as part of a drive to become “leaner” in the face of growing pressure on earnings from the rollout of the national broadband network and aggressive new competitors.
“We are consulting with our people on proposed changes that would ultimately result in up to 1400 roles no longer being required,” Mr Penn said in a notice to employees that was released to media.
“This impacts positions from most parts of the business, at all levels of seniority and from all states and territories and, in some cases, internationally.”
The Communication Workers Union said Telstra had “ambushed” the union and its workers with the announcement of the job cuts.
CWU national secretary Greg Rayner said the union had learned about the job cuts through the media, while CWU national president Shane Murphy said the cuts would impact Telstra’s service.
“They simply will no longer have the workforce to get the job done, so people can look forward to much longer wait times and frustration with increased outages – there is just no way around that conclusion,” Mr Murphy said in a statement.
Mr Penn told reporters the cuts were to keep up with changes in technology, competition and migrating to the NBN.
Telstra is facing a $2 billion to $3 billion hit to its annual earnings by 2020 due to lost compensation payments and the access fees it will pay to use the NBN.
The telco has also committed to spend an additional $3 billion on upgrading its network over the next three years to maintain its competitiveness.
Mr Penn said Telstra could succeed but “cannot afford to operate as we have always done”.
“This isn’t about a billion dollars’ worth in savings, but obviously we will continue to make better focus on productivity improvements,” he said at a press conference.
Mr Penn said he had “a great degree of empathy” for those impacted by the cuts, having been through a similar situation himself.
“I know what it is like,” he said.
“Obviously it is very confronting news for anyone who receives this personally.”
The company employs more than 32,500 full-time workers.
The news comes a year after the telco giant cut 326 roles across its sales, service and national office teams, saying there was less need for call centre workers with more than 50 per cent of its customer interactions happening online.
In February, Telstra reported first-half net profit dropped 14.4 per cent to $1.79 billion on the back of a 6.4 per cent fall in revenue to $12.80 billion.
Telstra shares closed two cents $4.36 at Wednesday’s close.