Threat of job losses at Vodafone following pay claim resolution

JOB LOSSES are thought to be on the way at telecoms operator Vodafone, following the resolution yesterday of a pay claim brought to the Labour Relations Commission (LRC) by the Communication Workers Union (CWU).

The LRC recommended that Vodafone pay the 20 per cent of its staff who are on collective contracts a 2 per cent pay increase from January 1st, 2011 and again from January 1st, 2012.

A pay freeze, which has been in place since last year, will remain in operation until the end of this year. While the telecoms firm’s other 950 employees won’t be entitled to any pay increases as part of the agreement, they will be eligible for salary reviews in the normal procedure in 2011.

In exchange for the pay increase, however, the CWU must agree as part of the LRC’s recommendation to engage with the company on a change agenda.

According to the firm, this change process will involve a review of the way the company works, but is as yet at an early stage. “Vodafone is reviewing its business operations and processes to ensure the company has the optimal structure to meet the challenges and opportunities of the total communications market,” said Gerry Fahy, strategy director with Vodafone Ireland.

However, it is understood that a re-organisation of the company’s business may involve some redundancies. When Vodafone last restructured in 2009, it led to a reduction in headcount of between 80 and 90 people, which was largely achieved either by voluntary redundancy or natural attrition.

Like other telecoms operators, Vodafone, which has its headquarters in Sandyford, Co Dublin, has been hit by the downturn in what has become an increasingly competitive market place.

Its most recent results, for the three months ended March 31st, indicated reduced service revenue.