Telefónica UK singled out over outsourcing strategy

The Communications Workers Union (CWU) has accused Telefónica UK of being irresponsible with its ‘rampant’ outsourcing strategy, putting livelihoods at risk and eroding employee rights.

The union points towards outsourcing trends through the last few years as a risky game for employees, most notably as there have been few assurances that employees transferred to external companies have few assurances they would be welcomed back to the organization should the third-party find itself in bother, or even if they would be readmitted on the same terms and conditions. Although not saying it outright, the CWU seems to be hinting at nefarious strategies to reduce risk and corporate responsibility for employees.

“Back in 2013 the CWU vociferously objected to the outsourcing of the thousands of jobs in the Voice Channel and escalated the issue to the then CEO, Ronan Dunne, expressing our dismay,” said CWU Assistant Secretary Sally Bridge.

“We stated then that we did not believe that outsourcing to a third party supplier was in the best interest of the customer or Telefónica as a business – and in February we once again raised the question as to why Telefónica would want to continue to risk using Capita to handle a major piece of its customer-facing work.”

Telefónica has been on a mission to reduce operational cost over recent years, though the company’s position has always been that of voluntary redundancies and not replacing those who retire; this is certainly a different rhetoric than the more reprehensible suggestions from the CWU. Looking at the numbers, the headcount stood at 122,718 at the end of 2017, down from 127,323 a year earlier.

Streamlining the workforce is not a new trend we are seeing in the telco space, but what needs to be ensured is that it is being done responsibly. A couple of weeks ago BT announced it was trimming 13,000 jobs, and Vodafone also announced it was cutting thousands across its international operations, while increasing pay-outs to the management team.

It not an uncommon occurrence for the telcos to be their own worst enemy, this is a scenario which has been created by the blood-lust of the rest of the digital ecosystem. OTT players has continued to destroy the cash-cow business models in the telco space, SMS and voice calls, while simultaneously encouraging the consumer to be more demanding and data-intensive. The telcos are less profitable and expected to underpin (and fund) the growth of the digital economy. With such an unbalanced equation, there are always going to be difficult decisions to be made.

Some might point towards a lack of foresight and innovation from the telcos, suggesting inaction and reliance on dated business models was the cause of such fiascos, however the economy which sits on top of the infrastructure, getting the first pick of the profits, has been biting the hand which feeds it for years. Little concern has been offered to the telcos who are expected to uphold the digital experience, yet not been offered a share of the digital bounties.

The difficult position telcos are finding themselves in has been thrust upon them, though we would hope there is an element of responsibility and finesse when making the tough decisions.