Coronavirus: Telstra freezes job cuts program

Telstra has frozen its huge job cuts program and introduced a raft of measures to help customers through the virus outbreak.

Telstra will not announce any new job cuts. Picture: AAP

Telstra on Friday froze its huge job cuts program, and said it will recruit an extra 1000 temporary contractors to help manage call centre volumes as part of its response to the growing coronavirus epidemic.

CEO Andy Penn said the company was not axing its $2.5bn cost reduction program - set to run until FY22 - but would not announce any new job reductions over the next six months.

Telstra had announced in 2018 that it would cut a total of 8000 employees and contractors by 2022.

"These are very challenging and unpredecented times," Mr Penn told investors on a conference call. "COVID-19 is having a profound impact on businesses across the country. We are supporting our customers as they shift to working and studying from home, and clearly telecommunications plays a critical role in all aspects of peoples' lives and the economy.

"Never has this been more demonstrated than in the current environemnt. Big businesses can show leadership and make a contribution to the national response."

The company will also speed up its 5G roll out, bringing forward $500m of capital expenditure from the second half of FY21 into 2020.

Telstra CEO Andy Penn. Picture: David Geraghty.

It will also suspend late payment fees and disconnections for small businesses and consumers until at least the end of April, and will extend any sponsorships expiring this year for another 12 months.

Telstra will also pay its interim dividend of $951m to shareholders next week, which Mr Penn described as a sort of economic stimulus.

“We are looking at every aspect of our business to see what we can do for our employees, customers, suppliers and the economy more broadly, while we maintain a focus on long term value creation,” Mr Penn said.

“The most important thing is that as many businesses as possible are still here when we get through this crisis.

“While it is critical we maintain a strong position we also believe there are a range of additional initiatives we can undertake now to help support the broader economy.”

He said he wasn’t in a position to predict the longer term impact of COVID-19 on Telstra’s business given he ‘wasn’t a medical professional’ but that the telco’s full-year earnings were still expected to fall within guidance.

Telstra this week also announced a raft of extra data measures for customers, but said they could likely expect longer wait times for support due to a lockdown in the Philippines.

And it announced on Monday afternoon it would be giving its consumer and small business customers unlimited data until the end of April as part of its coronavirus response, and pensioners would receive unlimited home phone calls.

“The data, which will be provided automatically, will help facilitate videoconferencing; voice over Wi-Fi, and cloud connectivity, all important tools when working from home or in isolation,” Telstra chief Andy Penn said in a statement.

“We are also giving our consumer and small business mobile customers more data. Post-paid customers (both handheld and mobile broadband) can receive an extra 25GB of data on their plan to use in Australia within 30 days to facilitate the need for a more mobile workforce.

“Post-paid customers can apply for the extra data via our Telstra 24x7 and My Telstra Apps from Thursday until 31 March and the data will be available within 24 hours.”

Telstra shares closed down 6 per cent per cent to $3.07.