By Lehlohonolo Lehana.
Telecommunications group Telkom said on Tuesday it would begin workplace consultations on internal restructuring that is expected to affect 15% of its workforce.
In a statement, the group said it would enter a formal consultation process with relevant stakeholders in terms of section 189 of the Labour Relations Act (S189A process) regarding the restructuring of certain operations.
“The S189A process will impact all business units and subsidiaries and is intended to ensure the sustainability of the group,” it said.
The group said it was managing the delicate migration of revenue between old and new technologies, but it was challenged with managing the costs associated with the different technologies, the competitiveness, and the sustainability of the group.
“Management has therefore embarked on a restructuring programme, which includes the S189A process, to optimise group costs in line with evolving technology capabilities and demands,” it said.
For Telkom to navigate the migration to new technologies, as well as current economic headwinds effectively, the Telkom board believed that management should start a consultative process aimed at restructuring the organisation to meet future demands, it said.
“The S189A process is expected to impact up to 15% of total employees across the group,” it said.
Telkom said it was committed to minimising the impact of the restructuring and would engage with all relevant stakeholders and employees across the group.
Telkom, valued at about R20 billion on the JSE, has been battling for years with a steady decline in its legacy fixed-line business, with fixed voice revenue declining almost double digits in its 2022 year, resulting in group revenue falling slightly. The company has been pushing into mobile services, and migrating from traditional copper to fibre.