Johannesburg: The Tata-led Neotel telecom consortium in South Africa is facing opposition from unions for its retrenchment plans as the company battles to meet profitability targets.
Neotel had issued notice to employees in December that it would be forced to cut back staff because of difficult trading conditions that had forced a rethink of the company’s business strategy.
Neotel, in which Tatas has 56% stake, posted large losses for the year to March 2010, with an internal source telling the daily ‘Business Day’ that Neotel was unlikely to meet its R3.25 billion revenue target by March this year.
Neotel declined to comment, but both the Communications Workers Union and Solidarity, representing just 200 and 17 members respectively of the 1,000 Neotel employees, said they would fight the planned retrenchments.
Neotel has refused to grant recognition to the two unions because of their low membership at the company.