According to a recent report in The Source, State-owned telecoms operator TelOne has slashed its employees salaries by 15 percent. This is opposed to the option of termination of employment contracts which has recently been chosen by several companies following a Supreme Court ruling that affected the Labour Act.
In addition to the reduction in salaries, TelOne is also reportedly considering a raft of measures to cut back on human resources costs. The measures include scrapping of annual bonuses, retention fees and suspension of overtime.
The telecoms sector has been experiencing viability challenges and some operators have already taken measures. Econet reduced salaries by 35% and sent employees home, Telecel recently sent employees home after having considered options such as paying part of salaries in airtime.
TelOne has been one of the more aggressive telecom operators in terms of performance coupled by their fiscal support from the government. While the option to reduce salaries is definitely better for now versus outright dismissal, if the situation does not improve and eventually they have to let staff go in the future, it means the termination calculations then will actually be lesser than today.
Another area of interest is how they will manage to circumvent the legal requirements to pay the 13th cheque, a feat that the finance Minister failed to implement for the Civil Service last December.