News: Telstra restructure program threatens jobs of thousands of workers

Employee Relations

Telstra restructure program threatens jobs of thousands of workers

As Telstra finalises its plan to divide the company into 4 business units, it puts the livelihood of thousands of workers in jeopardy who face the risk of job losses.
Telstra restructure program threatens jobs of thousands of workers

Australia’s one of the largest telecommunications corporations, Telstra commenced the process of negotiations with the Communications, Electrical and Plumbing Union (CEPU) over its new enterprise agreement (EA) which will affect the future of thousands of technicians. Telstra announced that the company will be segmented into four business units, InfraCo-Fixed, InfraCo-Towers, ServeCo and Telstra International in March this year. It has planned to establish separate EAs in each of these business units. This measure will disadvantage Telstra workers as this will make it even more difficult for them to oppose or protest against bureaucratic attacks on their jobs, pay and conditions. This will restrict them from fighting for the rights of their colleagues from other business units because of the oppressive Fair Work Act.

CEPU supports the Fair Work Act and is relentlessly trying to drive a wedge between workers. CEPU stated that it has not discussed the issue in depth but still prefers one agreement with the Telstra group workforce. It is widely believed that CEPU is trying to sell wolf tickets and does not want to openly back the carve-up owing to worker’s indignation. It has not defied any of Telstra’s other flagged demands as Telstra enters the final stages of four year restructure enforced by the unions.

Telstra is angling the idea of increased flexibility which includes split shifts and working outside of normal hours. Some basic conditions, such as 36.75-hour weeks, 15 weeks’ sick leave and its “above industry standard” redundancy package will be retained in the existing agreement as claimed by Telstra. The changes sought to be included in a variation to the “Telstra Award 2015”. They can only be contested by submitting an application to the Fair Work Commision.

While negotiating for the current EA, the CEPU accepted the meagre pay increments of just 1.8% in 2019-20 and 2% in 2020-21 which was less than the annual increase in the cost of living at that time. As the union-management agreement draws to a close, around 2,00 Telstra workers are at the risk of losing their jobs before the end of 2021. Indirectly employed employees which numbers to around 1600 will be stood down. These are the final planks of Telstra’s three-year $1 billion “T22” cost-cutting program which has led to at least 8,000 job losses since it was announced in June 2018.

Superficially assailing the cuts, CEPU in reality has done everything in its power to ensure that there is no widespread opposition against the cuts and also suppressed the voices of begrudged workers so that all the changes are carried out peacefully.  It has endorsed the company’s sham “employee assistance” and “career transition” programs, as well as vague promises of possible redeployment for some laid-off staff. It has misled the workers in several ways. 

A $3 billion restructure investment announced in 2016 was followed by its “T22” cost-cutting program. It was the first step to prepare Telstra for its expansion into Australia’s $50 billion government-funded monopoly National Broadband Network company (NBN Co). Creating a wholly-owned infrastructure business unit, Telstra InfraCo was a part of the restructure plan allowing Telstra to incorporate NBN Co into its business. This plan received a severe blow when the Federal Communications Minister Paul Fletcher cleared the matter and said that Telstra’s vertical structure, including retail, as well as Telstra InfraCo, meant it could not legally own the NBN wholesale network. 

Telstra announced the sale of 49% equity in InfraCo-Towers, to raise $2.8 billion. Half of it was returned to shareholders in dividends in June. The sale led to a surge in Telstra’s stock by 25%, compared with the beginning of 2021. Telstra’s mobile towers sales was sold to a well-heeled consortium, consisting of the Future Fund, the Commonwealth Superannuation Corporation and Sunsuper. It was done to strongly position InfraCo-Towers to raise the investment capital needed to expand the mobile phone infrastructure network.

Jobs  and working conditions of Telstra employees will further be compromised by these major restructure developments. CEPU will be a silent spectator and a complicit accomplice in these chain of affairs as it has overseen the destruction of tens of thousands of permanent jobs, and the massive growth of insecure contract positions.

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Topics: Employee Relations

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