Union leaders warn against mmO2 redundancies

Union leaders have warned that strike action will be inevitable if mobile phone group mmO2 pushes ahead with plans to lay off one fifth of its workforce.

The company - formerly BT Wireless - was spun off last year as British Telecom attempted to reduce costs. However, mmO2 has suffered from underperformance in terms of subscriber figures, which fell far short of the firm's expectations, but in line with analysts' predictions regarding poor growth.

In response, mmO2 announced plans to streamline its operation by slashing 20 per cent of its workforce, with jobs expected to go at its Leeds and Slough offices.

However, union chiefs have reacted angrily to the move, and stated that industrial action would be the only outcome if compulsory redundancies were enforced.

Deputy General Secretary of the Communication Workers' Union telecoms section, Jeannie Drake, said that mmO2's announcement came as "deeply disappointing news".

She said: "mmO2 was only divested from BT in November 2001 and yet after just two months we are looking at major job cuts.

"Throughout its short existence as totally separate company to BT, mmO2 has been talking about the importance of going for growth, particularly in the high profit areas of the market. It has been saying it needs to increase services and support for its customers and develop and extend the range of services it provides. That is good strategy, but how on earth is the company going to deliver it when it is taking 1,400 people out of its workforce?

"Of course the CWU understands that mmO2 is operating in a highly competitive marketplace, but we don't think that cost-cutting in this manner is the way to succeed."

With regard to the redundancies just announced, Ms Drake warned that "no compulsion" was the union's bottom line: "If the company moves away from a voluntary approach we will be in dispute." (CL)