Telstra faces political pressure over job cuts
Make us a preferred source
Make us a preferred source on Google
More news: Telstra looks likely to face scrutiny from both sides of politics after the telco announced it would cut 2,800 jobs as part of an organisation restructure.
What they said: At a press conference, Treasurer Jim Chalmers said: "I think this is a very distressing day for a lot of people who have received this bad news today from Telstra. We're thinking of all of the families who are impacted by these big job cuts. We need to make sure that the services don't suffer as a consequence of these changes and we will be seeking advice from the ACCC about some of the claims that Telstra is making."
National Leader David Littleproud said: "I'm always sceptical of Telstra and particularly for those that live in peri-urban areas and regional areas."
"We are the victims of underinvestment. And while I understand these are office jobs, it would be wise for Telstra to invest more on-ground jobs in delivering what should be a universal service to many Australians."
"And that's reliable mobility as well as data. And they failed to do that. They are a virus that is stretching right across this country. And when I've got towns that are without coverage, can't even use fax machines in businesses for two to three days, they have had a significant lack of investment in just getting the basics right.
"And I just say to the CEO start to get it right or I think it's time for government to reach in, particularly around mobility services, in regulating and extending the universal service obligation to do your job properly because they're not."
Telstra shares fall on workforce cuts
More news: Telstra shares lowered at market open on the ASX, after the telecoms major announced it would cut 2,800 jobs as part of an organisation restructure.
Shares were down 1.9% to $3.60 by 10:50am AEST. Over the last 12 months its share price has tumbled 17.17%.
Restructure 'absolutely necessary': Telstra CEO Vicki Brady
More news: Telstra CEO Vicki Brady told journalists at a press conference this morning that the company's focus is on supporting employees who will be impacted by the job cuts.
She noted, however, that the changes are "absolutely necessary" to set the business up to be sustainable and more efficient.
Brady noted that its redundancy package varied depending on years of service and included career transition support. This included ongoing access to learning over a six-month period post leaving Telstra to help move affected employees to their next role.
What they said: Brady said: "Absolutely front of mind for me today is our people and it is a very hard day for our people. So my focus has been on communicating to our teams, sharing with care and transparency, the changes that we are proposing".
"...I appreciate it comes at a time when people are doing it tough. So our focus is making sure we are supporting anyone whose job is impacted in the best possible way we can. That includes having industry-leading redundancy packages.
"... The changes that we're beginning consultation on today largely affect our teams in our Telstra Purple business, which is our tech services business, closely linked to the simplification of our network applications and services product, and effects our sales and delivery teams."
Telstra to cut 2,800 jobs
The news: Telecoms company Telstra has announced organisational changes including job cuts as it looks to simplify its enterprise business and outlined earnings growth for next year.
The numbers: It said the reset of its enterprise business along with other organisational changes would result the axing of up to 2,800 jobs, with the majority of this to occur within 2024. Simultaneously, it said a reduction of its non-labour and indirect labour costs would achieve $350 million of its T25 cost reduction ambition by the end of FY25.
Australia’s largest telecoms firm also forecast underlying earnings of $8.4 billion to $8.7 billion in FY25, a slight increase over the reaffirmed FY24 guidance of $8.2 billion to $8.3 billion.
Telstra said it expected a one-off restructuring cost of $200 million to $250 million across FY24 and FY25. These costs will be excluded from guidance and are in addition to business as usual annual restructuring costs.
The context: Telstra, which had announced a detailed review of its domestic enterprise business in February, said it would cut the network applications and services (NAS) product portfolio by two-thirds, simplify the sales and service model, and reduce the cost base of the Telstra Purple tech services business.
CEO Vicki Brady said the measures were necessary to ensure Telstra could continue to make the investments needed to support the ever-increasing growth in data volumes on its networks and deliver improved connectivity for customers.
The source: ASX announcement
