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BT Loses £134 Million, Will Cut 15000 Jobs

Most of the jobs will be lost from contractor positions and sites abroad, the company claims but unions are still concerned

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After announcing disappointing results, the telecoms giant and services company will cut 15,000 more jobs – heralding bad times ahead for BT staff according to the Communications Workers Union.

BT announced this week that it plans to lay off 15,000 staff after it reported an annual loss of £134m. The company has already shed around 15,000 jobs this year which was about 5000 more than had been expected by industry watchers.

Management at the telecoms and services company admitted that the global recession had hit the company hard and also placed the majority of the blame for the losses at the feet of BT’s Global Services division.

“Three out of four of BT’s lines of business have performed well in spite of fierce competition and the global economic downturn. However this achievement has been overshadowed by the unacceptable performance of BT Global Services and the resulting charges we have taken. During the year we have changed the leadership of BT Global Services and started to turn the division around,” said Ian Livingston, BT chief executive.

Union leaders reacted to the news of further losses at the telecoms company with a statement which called on BT to deliver on its promise that the staff cuts would be voluntary and made through natural attrition.

“We’re working closely with the company to ensure any losses are voluntary and we’re looking at new ways of finding new work and retaining permanent employees, including secondment agreements,” said Andy Kerr, deputy general secretary of the Communications Workers Union.

Kerr added that although many of the losses would be contractors and staff outside of the UK, job cuts on this scale meant tough times for existing workers. “We expect the majority of job losses to be third party – contractors and agency staff – as they were last year with many jobs being lost outside of the UK. However this is a serious day for staff at BT,” he said.

The CWU also agreed with BT’s own prognosis that the main blame for the company’s poor performance lay with the services division. “There was a damaging mis-management of Global Services by senior managers, which has been the main cause of these poor results. These managers have been removed and we’re hopeful that this difficult time is now behind the company,” said Kerr.

But despite the dire financial performance, BT’s Livingston said that the company was preparing itself to benefit from an eventual recovery and was even planning to bring ahead work and investment in fibre-infrastructure.

“With a recovery programme for BT Global Services in place and our heightened focus on costs and customer service, we now want to accelerate our plans for our future networks. We will examine doubling the pace of the roll out of super fast broadband next year within existing capital expenditure plans, bringing fibre based services within the reach of more than a million homes and businesses and securing the jobs of a thousand BT people,” he said.