Telefonica reaches agreement to cut around 2,700 jobs in Spain

Security guards walk past a screen displaying the logo of Spanish telecommunications company Telefonica at its headquarters in Madrid, Spain, May 12, 2021. REUTERS / Sergio Perez

Register now for FREE and unlimited access to Reuters.com

Register

MADRID, December 28 (Reuters) – Spain’s Telefonica (TEF.MC) has reached a deal with unions to cut some 15% of its national workforce through voluntary layoffs as part of an estimated plan 1.5 billion euros ($ 1.7 billion) this year, the telecommunications group said on Tuesday.

The plan to cut around 2,700 jobs in an increasingly competitive market in early 2022 will deliver annual savings of more than 230 million euros from 2023, Telefonica said in a filing with the stock market regulator.

“The impact on cash flow generation will be positive in 2022 as will the recognition of savings, since employees will leave during the first quarter of 2022,” the company said.

Register now for FREE and unlimited access to Reuters.com

Register

The program, open to anyone born in 1967 or earlier and with at least 15 years of employment with the company, will limit the percentage of departures from certain regions, the company said.

Telefonica had initially planned to spare business units dedicated to cybersecurity, marketing and artificial intelligence, although unions opposed it. The company initially intended to offer a package to around 1,800 workers.

The company is the third largest telecommunications company in Europe and employs 18,500 people in Spain. The layoffs follow similar moves by rivals Vodafone and Orange in recent months. Read more

Globally, Telefonica employs nearly 114,000 people.

Telefonica faces intense competition in an increasingly cheap Spanish market as well as pressure from investors at a time when it needs funds to finance 5G infrastructure.

($ 1 = 0.8826 euros)

Register now for FREE and unlimited access to Reuters.com

Register

Inti Landauro report; edited by Andrei Khalip and Jason Neely

Our standards: Thomson Reuters Trust Principles.

Source link

About Kelly Choos

Kelly Choos

Check Also

HSBC leaves China with new deals

A pedestrian walks past a sign showing the HSBC lion at its headquarters in the …