Telecom Vendors

BT plans to lay off 4,000 jobs worldwide after ‘challenging’ year

Following a “challenging year,” British telecoms group BT says it plans to lay off 4,000 jobs worldwide in an effort to drive down costs after posting falling profits. The company will cut jobs across three divisions including global services, group functions, technology, services and operations, BT said in its annual results statement.

BT currently employs 102,500 staff around the world and operators in 180 countries. It will take a one-off restructuring charge of $388 million (357 million euros). The company saw its pre-tax profit fall by a fifth to £2.35 billion in the financial year to the end of March. It was hit by an Italian accounting scandal, troubles at its Openreach broadband unit, and challenging trade both in the UK and abroad.

“Technology trends mean that we are now less dependent on owning physical local network assets around the world, creating the opportunity to reposition Global Services as a more focused digital business,” said BT CEO Gavin Patterson, adding that the company was therefore restructuring its Global Services division and expanding its cost transformation program. “This will help offset market and regulatory pressures and create the capacity for future investment,” Patterson said.

Patterson did not receive his 2016/2017 bonus from BT’s remuneration committee which totaled £338,398, as a result of a string of issues. The company revealed in January news of an accounting scandal at its Italian division which cost the group £530 million. In addition, British regulator Ofcom hit BT with a bill of around £350 million in March, in fines and compensation following delays to high-speed cable installations by its Openreach broadband unit.

“The past year has been challenging,” said BT remuneration committee chairman Tony Ball. Unfortunately our performance has been significantly affected by the accounting irregularities in our Italian business, the issues that arose in Openreach… and the significant challenges we faced in the UK public sector and international corporate markets.”

The BT committee had made “a number of difficult decisions this year in light of these circumstances and exercised its discretion accordingly,” Ball said. Openreach maintains tens of millions of copper and fibre lines connecting telephone exchanges to homes and businesses across the UK.