How much Telkom will pay employees to leave the company

Telkom is offering employees voluntary separation packages as part of its plan to reduce the number of staff at the company, with payouts to staff based on the number of years they have worked at Telkom.

According to a Telkom document seen by MyBroadband, Telkom has told staff that the cuts will take place in two phases.

  • Phase 1: Openserve, Group IT, and Consumer will be affected between January to April 2020.
  • Phase 2: Corporate Centre and Telkom SOC Support (HR, finance, procurement) will be affected between May to August 2020.

Telkom went on to provide reasons for the job cuts.

In the Consumer division, the cuts are a result of the business evolving away from a traditional copper-based service supplier.

It added that its “legacy operating model” is not aligned to “digital/mobile customer requirements” – and shared the follow graphic with staff as an explanation. (Click to enlarge)

Legacy Operating Model

In the case of Openserve, Telkom said the wholesale division is “seeing continued decline” in its legacy-based technology revenue, with “increased push from both clients and consumers to move towards next-generation technologies”.


Voluntary packages

In a bid to reduce staff numbers before forced retrenchments are implemented, Telkom is offering employees voluntary severance packages and voluntary early retirement.

The voluntary packages offer staff the following if they leave the company:

  • Notice period of 3 months.
  • 0-10 years of service will receive 2 weeks payout for each year worked.
  • 11 years and more of service will receive 1 week of pay for every year worked.
  • Minimum payment of 4 weeks applies.

All accrued leave will also be paid out, and pension fund and “social plan” payments are on the table.

The table below shows what employees will be paid, based on how long they have worked for Telkom. (Click to enlarge)

VSP Table


Number of affected employees

The majority of workers who will be affected in the first phase of staff reductions come from the Openserve division.

According to the Telkom document, a potential reduction of 388 employees will take place in the Consumer division – while Openserve is set to have 2,425 employees affected by potential reductions.

The tables below details the numbers. (Click to enlarge)


Consumer division

Consumer Employees


Openserve division

Openserve Employees


Retrenchments

Staff who are retrenched by Telkom will also receive a payout, although it is lower than what is on offer with the voluntary packages.

The severance packages will provide Telkom staff with:

  • Notice period of 2 months.
  • 1 week payout for each year of service.

Leave days owed will be paid out, along with potential pension fund and “social plan” payments.

The table below details what employees will be paid, based on how long they have worked for Telkom. (Click to enlarge)

Retrenchment Table


Now read: IT salaries in South Africa – how much people earn in 2020

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How much Telkom will pay employees to leave the company