BT to shed a further 15,000 jobs

BT has said it will cut about 15,000 jobs this year, mostly in the UK, and has reported an annual loss of £134m.

The firm also said it had cut 15,000 jobs in the past year, which was 5,000 more than expected.

BT's woes centre on its global services unit, which handles the network systems of large firms. BT said it had taken a near £1.5bn write-down at this unit.

The firm also said that it would be making pension contributions of £525m in each of the next three years.

It also cut its dividend sharply from 15.8 pence to 6.5p.

"Three out of four of BT's lines of business have performed well in spite of fierce competition and the global economic downturn," said BT chief executive Ian Livingston.

"However this achievement has been overshadowed by the unacceptable performance of BT Global Services and the resulting charges we have taken."

Union talks

The latest 15,000 job cuts represent 10% of the firm's current workforce.

BT said it hoped to remove the positions through natural wastage and voluntary redundancies, and added that it did not have plans for compulsory lay-offs.

"Our aim is to work closely with the unions to reduce BT's total labour cost, of both direct and indirect staff, as this is critical to the success of the company going forward," said a BT spokesman.

Andy Kerr, deputy general secretary at the Communication Workers' Union, told the BBC he hoped there would not be any compulsory redundancies.

"We have worked closely with the company over the last year to make sure there were no compulsory redundancies in the company," Mr Kerr told the BBC.

"We did it last year and the commitments have worked so far, as there's certainly no plans for compulsory redundancies for this year coming."

BT's overall group-wide revenues for the year to 31 March 2009 rose 3% to £21.4bn.

Annual revenues at its BT Retail unit, which provides phone lines and broadband to homes and smaller firms, fell very slightly to £8.47bn from £8.48bn a year earlier.

Revenues at its BT Wholesale unit, which runs its networks, declined 6% to £4.7bn.

"This has been a challenging year in which BT has had to tackle some significant issues," said BT chairman Sir Mike Rake.

Source: BBC News, 14th May, 2009

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