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TMCNet:  Telenor axes 850 jobs now target Pakistan

[May 25, 2014]

Telenor axes 850 jobs now target Pakistan

(Flare (Pakistan) Via Acquire Media NewsEdge) “Telenor Pakistan has warned that it plans to shed at least 100 jobs in Pakistan as a result of the Asian financial crisis” Telenor, the Norwegian international telecommunications giant, slashed almost 850 jobs throughout spring. Unions accused Telenor of “social dumping” by outsourcing work to cheaper Asian markets, but the company argued it had to restructure to stay competitive. Telenor said it needed to cut 450 full time equivalent positions from its Norwegian operations, roughly one in 10 jobs. A newspaper reported the number of jobs in the group had been reduced by almost 850, with 750 of those in Norway. At the start of the year, Telenor had about 6,600 staff in Norway.


Since March, Telenor has cut staff through redundancy packages, closing its customer service department in Finnsnes, and selling its international television security firm Conax. Management is now considering outsourcing parts of Telenor Global Shared Services, an internal company dealing with shared administrative services like finance, accounting and internal customer service for the whole Telenor Group in 13 markets. The move could affect more than 200 employees, including 100 in Norway.

Telenor’s head of information, Glenn Mandelid said Telenor was not the same company today as it was 15 years ago. “If we had been, we would not have been competitive,” he said. “Therefore it’s an important part of Telenor’s culture to work with continuous improvements.” He said while the Norwegian operations had to adapt to changes in technology, it was not the case that Telenor Norway would be left a branch office. “Norway is an important home market,” said Mandelid. “In addition we learn a lot from Telenor Norway that we take with us internationally.” He rejected the accusations that considerations to outsource Global Shared Services could lead to social dumping. “The company delivers services in Norway, Europe and Asia, and we’re evaluating how we can do this in the best possible way. Telenor does not engage in social dumping. We have strict requirements of our partners and suppliers.” Telenor Pakistan has warned that it plans to shed at least 100 jobs in Pakistan as a result of the Asian financial crisis. It has claimed that Telenor Pakistan is the largest telecom company that offers exciting and challenging careers with competitive pay, excellent benefits and exceptional advancement opportunities but on the contrary, it plans to lay off at least 100 employees. In Pakistan, the unemployment is ratio already much high than other countries.

The labour and services in Bangladesh cheaper than Pakistan but it’s not mean to lay off employees and hire other country people, however, Telenor Norway has made a complete U-turn in its strategy and commitment towards Pakistan, which was managing group’s finance functions for quite a time now. Telenor Global Shared Services Norway is expected to make some changes in its operating model which involves organizational changes with possible impact on employees based in Norway and Pakistan. Impacted employees will be mainly from Telenor Shared Services (TSS), an entity that handles Telenor’s Finance and Accounting Functions.

Telenor Global Shared Services Pakistan is an internal provider of services to Telenor Group in Finance and Accounting, IT and Customer Services. Some of the employees – who were initially employed by Telenor Pakistan and then moved to TSS — are working with Telenor since 2004, however, major chunk of TSS was hired in the last two years with promises about future job security and career advancements.

These fresh graduates were hired through on contractual terms through third party vendors and hence not even legally owned by Telenor. Though in substance even the interviews, short listing procedures are done by Telenor Pakistan.

On the other hand, India may ask Norwegian telecom operator Telenor to pay a fine of up to Rs 350 crore as the Department of Telecommunications (DoT) says its earlier majority-owned local joint venture (JV) had violated rules while combining its seven units into one company in 2010.

Unitech Wireless, Telenor's now-severed joint venture with real-estate firm Unitech, had violated a clause that forbids sale of stakes by promoters within three years of getting telecom licences and before meeting the mandatory roll-out obligations, according to an internal DoT document that ET has seen. The department considers amalgamation of the seven units into Unitech Wireless Tamil Nadu as a stake sale.

The promoter's lock-in clause was introduced in 2009, after Unitech Wireless got airwaves in 2008. It amalgamated the companies after the Delhi High Court gave it the go ahead, but the telecom department says the company did not take its approval before doing so.

According to the document, the amalgamation implies that the shareholders sold all their shares in their respective companies well before the expiry of the mandatory lock-in clause, thereby violating the clause.

When contacted, a Uninor spokesperson said the company had not yet received any DoT communication on the matter. "Four years ago, Unitech Wireless had conducted this amalgamation that we believe was in accordance with the applicable laws and license terms, following the due process, subsequent to a favourable order from the Hon'ble High Court and keeping all government authorities notified as required at each step," the spokesperson said.

The seven Unitech Wireless companies were Unitech Wireless (Delhi) Pvt Ltd, Unitech Wireless (East) Pvt Ltd, Unitech Wireless (West) Pvt Ltd, Unitech Wireless (North) Pvt Ltd, Unitech Wireless (South) Pvt Ltd, Unitech Wireless (Kolkata) Pvt Ltd and Unitech Wireless (Mumbai) Pvt Ltd.

The number of jobs in the group had been reduced by almost 850, with 750 of those in Norway.

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