TSTT yesterday started retrenching workers, with over 500 senior and junior staff receiving letters informing them they have become redundant, as the company "transforms to survive."
The company said in a statement that from yesterday, "TSTT executed on a critical phase in its organisational transformation. This phase involves 503 junior and senior staff employees receiving retrenchment notices along with payment in lieu of the 45 days’ notice. The next phase will involve the rationalisation of non-unionised employees, including the executive level."
Among the workers getting retrenchment letters is Clyde Elder, head of the company's majority labour union, the Communications Workers' Union.
“Today, the union would have received a letter from the company informing that workers were going to be retrenched. I was also retrenched effective today. I say effective today because they have paid all workers 45 days in lieu of notice. So now we have to get vacation settlements and the retrenchment packages,” Elder said.
All these workers are permanent, he said. He was also surprised at the company’s stated 503 workers, since the listing to the union had 440 names. Elder, who worked as a senior administrative clerk at the Cipero Work Centre in San Fernando, shared his letter with the media. In it, the company said it used the “last in, first out” process to determine who would be cut from the company.
Elder’s letter said he would be paid for his years of service in accordance with Schedule 1.2 of the Junior Staff Collective Agreement as it relates to severance benefits. All sums owed to those retrenched will be paid on or before January 31, 2019 and will be subject to any taxes and debts owed to the company.
Workers must also return company identification badges and other company property to the senior manager of human resources, Ronald Hinds, by December 31.
Justifying the decision, TSTT’s CEO Dr Ronald Walcott said via the release that the company recorded an operating loss of $32.5 million in the previous financial year, "and the contributing factors that led to that performance continued in the six months of the current financial year to September 2018,” when the company recorded a loss of $478.8 million. TSTT’s financial year runs from April to March.
TSTT said in the release that it "has been plagued with a perennial problem of high employee costs."
It explained, "Contrary to the assertions being bandied about in the public domain, of the $768 million annual wage bill, emoluments to junior and senior staff comprise 82.3 per cent. The company is also carrying a debt burden of $1.8 billion of which 40 per cent (or about $700 million) pertains to the settlement of back pay to junior and senior staff.
"In addition, TSTT’s employee cost is greater than 30 per cent of its revenue; the industry benchmark being 15 per cent. The revenue per employee is US$177,000 compared to the industry benchmark of US$400,000."
Line minister for TSTT, Public Utilities Minister Robert Le Hunte told Newsday yesterday that he had “every confidence” in the board and senior management of the company, as he directed all questions specific to the retrenchment to them.
“As I mentioned in my budget presentation, the board and management of TSTT had to contend with the organisation reporting an operating loss in the vicinity of $32 million. I am aware that they have been taking the necessary steps to return the company to sustained profitability,” he said.