Telstra job cuts top 1000 over six months in deep cost-cutting drive

TELSTRA has axed more than 1000 jobs in six months — and there is evidence more job losses are on the cards.

TELSTRA has carried out its biggest round of job cuts in more than three years, axing almost 1100 positions from its workforce over six months.

And more deep job cuts are on the cards at the trouble-plagued telco, which is believed to have brought in external consultants to look at options for further cost savings.

The Melbourne-based telco heavyweight, led by chief executive Andy Penn, axed the equivalent of 1088 fulltime jobs over the six months to December, the Herald Sun has established.

Telstra, Australia’s biggest telco, now has the equivalent of 32,551 fulltime staff members.

The job losses over the past six months are the deepest at the group in three-and-a-half years: in August 2013, it revealed it had cut 2251 jobs over the past financial year.

Telstra chief Andrew Penn. Picture: Stuart McEvoy.

In a statement, a Telstra spokesman said the business was rapidly changing, driven by the rollout of the National Broadband Network “and our move into other industries and markets”.

“It is important to note that in recent years our job numbers in Australia have been fairly consistent, as we have added people in growth areas and (removed them) in our traditional business areas,” he said.

Some “non-customer facing roles in our retail and global finance services business units” were cut in the past six months, he said, as part of a push to “streamline (and) remove layers and duplication to drive a better customer outcome”.

For the past half-year period, redundancy costs increased by 64 per cent, or $57 million.

The spike was the result of what the telco called “an increased focus on accelerating restructuring activity relating to our productivity programs”.

In a worrying sign for staff, the telco expects to fork out $300 million to $500 million for “restructuring costs” across its full financial year, which ends in June.

Telstra declined to say whether external consultants were scrutinising the books in pursuit of further cost-cutting options.

“We use consultants from time to time to assist with improving our business practices,” the spokesman said.

The telco, which has suffered a series of network outages over the past year, has also had an increase in “labour substitution costs” over the past six months.

Telstra paid an extra $32 million — an increase of 7.2 per cent” — for “labour outsourcing” over the period.

The revelations come after investors stripped $4 billion from Telstra’s market value during a torrid day of trade for the telco last Thursday after it released its first-half results.

Shares in the group tumbled 6.6 per cent during its worst single-day market rout in more than six years as it revealed a fierce price war was taking a deep toll.

They are yet to recover any of that ground.

Telstra’s net profit for the six months to December clocked in at $1.79 billion — down 14.4 per cent on the same period a year earlier. It came as revenue dipped 6.4 per cent to $12.8 billion.

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