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Two unions to take South Africa's Telkom to court over planned job losses

JOHANNESBURG (Reuters) - Two unions representing some of Telkom SA's workers said on Tuesday they would take the South African landline provider to court over possible job losses.

Telkom said it planned to slash jobs from a management layer that had 2,650 posts but that it had not yet decided how much of that number it would eventually cut in an effort to slash costs and regain market share.

The South Africa Communications Union (SACU) said however it believed Telkom intended to let go of about 9,000 of its 19,000 employees over the next six months.

"We are drawing up the papers so that we can refer the matter. We intend going to court on the issue of the company not consulting with us," said Karriem Abrahams, SACU general secretary.

Separately, the Solidarity union, which represents mainly white workers, said it would file a court petition on Tuesday to prevent the company from sacking its members based on race, claiming Telkom might use it as a criterion.

"It is not lawful that you take that approach," said Johan Kruger, deputy general secretary at Solidarity. "Race should be irrelevant when it comes to retrenching people."

The company said it aimed to reduce the number of management layers over the next five years and cut its costs by 1 billion rand ($93 million) annually over the next five years.

"Telkom has underperformed for several years as its share of market in fixed voice and data continues to decline and fixed-to-mobile substitution has intensified competition," the company said.

Solidarity's Kruger acknowledged that the company had not made any overt suggestion that race would be a factor.

"It's not been explicitly been stated, but the fact is that it is there," he told Reuters.

Under South African law on black economic empowerment (BEE) companies must increase black ownership and numbers of black workers. Quotas vary from sector to sector.

"The reasons being put forward for taking race into account is that Telkom has to reach or maintain a certain BEE rating," Kruger said.

"The other reason is that they have a duty to reflect the national racial demographic within their workforce. So that is why they may take race into account and we are saying no, those two are not operational reasons when it comes to retrenching."

Telkom said it would consider qualifications and experience in restructuring and underlined that employment equity - the racial mix of its workforce - was only "one of the four criteria that will be applied".

Telkom shares have gained more than 70 percent this year after new management at the company, which is majority owned by the government, tightened its belt and posted a profit.

($1 = 10.7345 South African rand)

(Reporting by Helen Nyambura-Mwaura.; Additional reporting by Zandi Shabalala; Editing by Susan Fenton/Ruth Pitchford)

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