OWN CORRESPONDENT, Johannesburg | Tuesday
VODACOM, the cellular phone network operator, is expected to retrench staff at one of its subsidiaries because of financial losses resulting from “duplication of duties,” a Johannesburg daily newspaper has reported.
Business Report said that confidential company documents indicated the imminent restructuring and looming job losses had been triggered by poor profitability of the VSPC (Vodacom Service Provider Company), the latest addition to the companies under the wing of the Vodacom Group.
VSPC was formed by a merger between service providers Teljoy, Cellphones Direct and GSM, which were all brought into the Vodacom Group stable through a 100% outright acquisition.
The newspaper said that sources at the company estimated that at least 2 000 people would be laid off around the country. Vodacom’s Joan Joffe refused to give details of the job losses involved.
Joffe said that after the formation of the VSPC earlier this year, it was found that too many people were doing the same thing.
“Everything was four times everything. It was more than duplication of duties.”
The VSPC staff, who are still in the dark as to who will be laid off first, are believed to be looking for a trade union to assist in the pending negotiations regarding retrenchment.
A memorandum issued to staff last week said VSPC’s strategic and financial objectives were not being met and all aspects of the business were under review.
It said it was “critical for the new strategy and structure” to increase connections, decrease operating expenses, drastically increase operational efficiencies and restore profitability.
The memorandum added that the company would recruit “competent and qualified staff needed to drive this new structure successfully into the future”.
Management have already informed staff of an immediate freeze on new appointments until March 31 next year. All temporary staff contracts would be terminated and there is also a freeze on the purchase or rental of all office equipment, vehicles and information technology equipment, as well as on salary increases and promotions.
In addition, overseas trips have been axed, unless critical. All local air travel has been restricted to economy class, while entertainment expenditure would have to be kept to an “absolute minimum”.