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News : Telstra to Axe Jobs in Asia Push
July 24, 2014 -- Telstra has announced plans to slash more than 600 jobs from its business as the telco shifts large chunks of its workforce overseas to support its growth in the Asian region.
More than 460 existing Telstra roles, plus another 208 contractor roles, have been tagged for redundancy as the telco seeks cheaper labour with outsourced partners in India.
The cuts represent 15 per cent of the 4100 staff employed in Telstra’s Global Services division, which delivers cloud computing and network application services for big-ticket corporate clients and government.
The cuts are in addition to more than 250 redundancies made to the division in July last year. In all, Telstra employs about 38,000 people.
"These are not decisions we take lightly and we will consult and work closely with our people on this proposal," said David Burns, Telstra’s group managing director of its Global Services division. "If a decision is made to proceed we will aim to redeploy as many affected employees as possible. We take our responsibility to support employees through this period very seriously, and we absolutely understand the impact announcements like this can have on our staff."
The cuts are expected to begin in September, assuming no complications arise from discussions with the telco’s main unions, with a completion date set for July 2015.
Late yesterday, Community and Public Sector Union president Michael Tull flagged his distaste at the proposed cuts, saying staff were "shocked and saddened" by the news.
"Telstra is moving into a very worrying phase of offshoring. This is a very profitable and growing part of the business," Mr Tull said.
"So it’s shocking to see that Telstra is prepared to outsource its future."
"Offshoring started with call centre and IT help desk roles, which has cost thousands of jobs, ruined careers and denied young Australians entry-level jobs.
"And at the same time that Telstra was cutting jobs it was building up the skills and technical savvy of offshore companies so that they could take more jobs.
"Now Telstra is moving more highly skilled work offshore. It’s bad news for workers, and bad news for the economy as we offshore our capacity for future innovation," Mr Tull said.
The potential cuts were flagged last year when Telstra announced changes to its global services division as it increasingly looks towards Asia for new revenue growth opportunities.
Telstra chief financial officer Andy Penn recently revealed the company was ramping up operations and partnerships in Asia and in talks with telecom operators as part of a push to increase its influence and earnings in the area.
Telstra’s Asian strategy is being driven across three platforms: to expand its Global Enterprise Services division, capitalise on the shift in Asia to 4G mobile services, and long-term investments.
As part of that push Telstra wants to expand its Network Applications and Services division across the region, a target chief executive David Thodey has highlighted as a key growth area.
"To compete effectively internationally we need to have resources in the region and the capability to scale rapidly to meet demand," Mr Burns said.
"We need to have appropriately skilled people in the geographies where our customers are, in order to build relationships and provide the level of service needed to win and retain international business."
Posted by Veronica Silva Cusi, news correspondent
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Telstra Incorporated is a global provider of advanced communications services to multinational corporations.
Published: Thursday, July 24, 2014