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Employees of majority state-owned company TSTT who are to be retrenched by the company will on average receive between $1.1 million and $1.3 million according to at least three highly placed sources with knowledge of the proposed packages.

The Sunday Business Guardian has been reliably informed that the cost to TSTT will be closer to $500 million and the company on Friday would neither confirm nor deny the information, instead pointing to a previous release that suggested that it was not prepared to go into detail in public about the nature of the negotiations with the workers representative unions.

TSTT in a release sent on Friday stated that it “commenced the process to secure funding from the financial markets to cover the separation costs of its proposed restructuring exercise.”

“The company plans to finance the restructure without the need for a government guarantee,” a release stated.

TSTT stated that it “anticipates that, if given effect to, the high anticipated cost of the proposed restructure will be readily offset by savings in personnel costs, the elimination of maintenance costs associated with obsolete plant and technology and revenue from new streams of business, which will partially offset the loss of revenue from voice calling services, local and international.”

The Sunday Business Guardian has been told that the sums expected to be paid out are quite large because of the length of time that many of the employees have been with the company and the salaries that they earn at present.

It was on January 17 that TSTT first alerted the country of its plans to retrench workers.

In a release, the company said it had written to its employee representative unions inviting them to consultations regarding a proposed refinement of its operating/business model.

“Like other companies in T&T, TSTT has been significantly impacted by the economic conditions brought on by the COVID-19 pandemic. This, coupled with increased consumer adoption of digital applications like WhatsApp and communications platforms like Zoom, has seen the steady erosion of traditional voice revenue. In T&T, fixed voiced calling in terms of minutes and calls have declined by 50 per cent over the past 10 years and mobile voice calling has declined by 20 per cent in the same period according to the annual TATT market reports,” TSTT noted.

According to the majority state-owned company the legacy costs associated with redundant technology in its existing operating structure, continue to have a crippling impact on TSTT’s business and its results.

It said during the past financial year which ended on the March 31, 2021, TSTT’s revenue fell by $453 million–18 per cent less than the prior year. This material decline it said was partly due to issues related to the COVID-19 pandemic and a combination of economic and technological factors both unique to the T&T market as a direct result of the global digital revolution in the telecommunications industry.

“Regionally and internationally, networks are under pressure: internet traffic is growing exponentially, but the price per gigabyte is declining almost as rapidly, and the result is a downward pressure on revenue growth and margins. TSTT has had to focus on aggressively managing its expenses over the past year as these trends intensified, more so than its competitors who have global cost-economies of scale. The company introduced several initiatives, the most significant of which was a cost-cutting drive that included the containment of non-personnel expenses,” the company’s press release noted.

Commenting on the proposed action, TSTT’s CEO Lisa Agard said, “Given our current challenges, TSTT considers that it must now urgently restructure to remain competitive. We must move to an operating model that is more in line with industry benchmarks, and which gives us the ability to adapt and evolve with the constant developments in technology. This is our only option if we are to return to profitability.”

The release said TSTT will enter the upcoming discussions in good faith and with the hope that all parties will focus on achieving sustainable revenue-generating initiatives, whilst also focusing on cutting operational expenses.

The company added that it was ready to put forward what it believes to be a reasonable and workable operating model to best position it to survive during the remaining impacts of the pandemic and the new environment of continuous technological change that defines the broadband revenue business model.

TSTT said it looks forward to engaging the representative unions to find common ground on the way forward.

But Secretary General of the Communications Workers’ Union Clyde Elder claimed the company has not told the union about the proposed packages and therefore he was not familiar with the $1.1 million to $1.3 million figure.

“I am unaware of these payment packages. There have been no discussions between the union and TSTT regarding payment packages. We are yet to receive a date regarding this as there has been no indication by TSTT when this would take place,” Elder stated.

While the sides met on February 1, Elder said they have not had negotiations and all that happened was a presentation by the company to the union.

Elder told the Sunday Business Guardian, “That was all. There was no discussion, no consultation. They (TSTT) did not really answer any of our questions. They said we would get into that later on. The only question they answered after being pressed about four or five times was how much of the bargaining staff would be going home They did not want to answer at first then we said 425 and then after we said it was 455. The only financials which was discussed was the impact of COVID and a loss of revenue for different reasons. We have not even discussed retrenchment with the company All they told us is 455 people stand to be impacted from their proposal.”

He also wanted to know where is TSTT getting the money to pay all these people when they said they have no money

“This is about five or $600 million. So this cannot be used to do other things and to create revenue? We don’t know when we are going to discuss financial packages because there is no proposed date. We are meeting today among ourselves as a union, we are going to reach out to the company by next week Tuesday, Wednesday and I suppose we are going to engage in further discussions. We don’t know what are the final figures to be paid out so I really cannot say what are the final figures to be paid out,” Elder noted.

He added, “We had a meeting to discuss restructuring, the proposal that they came with and what they presented to us was only a management structure. Meaning that the positions they are keeping in the company going forward are only for the managers nobody else. I cannot say how many positions because the presentation they sent to us was not the full structure.”

Prime Minister Dr Keith Rowley has directed Finance Minister Colm Imbert to meet with TSTT and the CWU with respect to the request for an audit into the company. –With reporting by

Geisha Kowlessar-Alonzo