Job losses loom as Telecom plans shift overseas

Losses likely to be concentrated in Gen-i

Hundreds of hi-tech jobs at Telecom are on the line as it considers shifting services overseas.

Documents leaked to The Dominion Post show that 400 to 500 jobs could be axed in one of the least radical options proposed.

Labour communications spokeswoman Clare Curran said she had been told between 400 and 1500 jobs could go. Telecom had approached firms about outsourcing IT work.

Spokesman Mark Watts confirmed yesterday that "six or seven" companies had been asked to "workshop" proposals but it was not a formal tender process.

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See also: HP NZ shifts Telecom work to India

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One of them, global giant Hewlett-Packard, proposed increasing "best shoring" — finding jobs in the country that best suit the clients — from 20 percent now to 80 percent over a period of 13 months in some areas of the business. The impact on the workforce could be minimised by redeploying staff, it said.

Options from IBM and India-based Tech Mahindra, which Telecom already uses to outsource some work, would result in even more jobs going. Curran said she had been told a tender process was well advanced within Telecom "that could and is likely to outsource a large number of hi-tech jobs overseas. The figure quoted to me was between 400 and 1500 jobs".

Any losses were expected to be concentrated in Telecom's in-house IT business Gen-i.

Watts said no decisions had been made and the figures cited of possible job losses were wildly speculative.

"We thought it was important not to constrain anyone's thinking so we could consider new and innovative ways of delivering the shared-technology services part of our business in as effective, efficient and customer-focused manner as possible. As such, we have asked various vendors to put forward their proposals to us in the form of white papers."

He would not name those involved.

Watts could not deny that changes would be made, nor that there would be job losses.

Council of Trade Unions president Helen Kelly criticised the "narrow short-term move" by Telecom.

"It ignores the added productivity that can be gained from having hi-tech people in your business, caring about your business and innovating in your business. We've seen that in Telecom XT failures and the lack of investment in infrastructure."