Trade union slams BT restructuring plans

Trade union Prospect has hit out at BT’s drawn out plans to cut 13,000 staff as part of a restructuring plans to cut £1.5 billion a year from the spreadsheets.

Holding an open ballot to measure the reception of BT’s ‘People Framework’, the proposed organizational structure following the restructure, BT employees represented by Prospect have overwhelmingly rejected the proposal. 96.3% voted against the proposal.

While former CEO Gavin Patterson spent years forking out cash on various schemes, including rights for English Premier League and European Champions League football, his last actions were at the polar opposite end of the scale.

Announced in May 2018, the wide-ranging restructuring plan was to create a new BT business, one which is designed for the digital era. Alongside trimming the workforce by 13,000, the team would also overhaul its supply-chain and relocate from its central London HQ. BT claims many of the cuts would be sourced from back office and middle-management roles, supposedly protecting the workforce which will perform network maintenance and upgrades.

Over the last couple of days, new rumours have emerged out of the BT office suggesting new CEO Philip Jansen and his team are considering 25,000 cuts on top of the aforementioned redundancies. Should the rumours turn out to be true, BT’s workforce would be trimmed down to roughly 75,000.

In reaction to the original cuts, Prospect conducted an open ballot on BT’s ‘People Framework’, the new internal pay and grading structures. This framework is designed to create fewer management roles, each with more accountability, and de-layering the management organization.

“The rejection of the ballot by BT members gives a clear message to CEO Philip Jansen that he is not bringing his staff along with him in his future vision for BT,” said Prospect National Secretary Noel McClean.

“Good companies are built from the inside and organisational change on this scale is rarely successful when it is imposed on people. These changes will not just see the knowledge, skills and legacy of BT vastly reduced, but will severely impact local jobs and grassroots technology industries supporting local economies.”

While redundancies are certainly far from an ideal situation, BT does need to do something. The telco is currently bloated, representing one of the worst revenue returns per employee across Europe. These are the figures which shareholders would have been looking at when Jansen entered as CEO and you can guarantee he was given a mandate to improve this aspect of the business.

BT currently generates £254,200 per employee per annum, and though this compares to £275,900 at Orange, £327,100 at Telecom Italia, £350,800 at Deutsche Telekom and £405,300 at Telefonica. When you look at the value of assets per employee, the numbers are equally as unattractive. BT clearly needs to do something to alter these numbers.

Prospect has suggested the new system would create a less transparent pay review system to workers across all levels and divisions. It has also questioned whether the telco would be fit to serve the wider digital ambitions of the UK as a result.

Jansen might have been able to keep himself out of the media spotlight so far into his reign, but with his first earnings call only a couple of weeks away, the new CEO might well be called into the limelight to address this conflict. The initial announcement certainly attracted political attention, and we suspect this ballot might well do the same.