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Deutsche Telekom to negotiate about employment guarantee for T-Service

Securing jobs for employees is the main objective – Opportunity requires courage and creativity – Better IT and lower costs means more benefits for the customers

Deutsche Telekom intends to negotiate the creation of service companies within the Group on the basis of a clear employment guarantee for T-Service beyond December 31, 2008. The company underlined this and other important facts on Friday. The Board of Management will be seeking the go-ahead for its concept and for negotiations with the employee representatives at the Supervisory Board meeting on February 28.

By adjusting terms and conditions for T-Service it will be possible for Deutsche Telekom to secure jobs within the Group beyond the end of 2008 and offer customers better quality service at the same time. Negotiations are to be held, for example, on increasing working hours to at least 38 hours, improving individual performance orientation by offering attractive incentive systems and extending variable remuneration, bringing salaries into line with the market in a socially conscious manner and implementing new starting salaries for junior staff – measures that have already proven successful and have had a positive impact on employment at T-Punkt Vertriebsgesellschaft and T-Mobile.

“Deutsche Telekom is pursuing a very clear strategy to secure jobs within the Group in Germany," said Dietmar Welslau, Representative of the Board of Management for Staff Restructuring and Safeguarding Employment and CHRO of T-Com.

“The opportunity is there, but it requires courage and creativity from both the company and the union. We intend to pursue this course.“

Mr. Welslau says that it is a good starting point for the negotiations that Lothar Schröder, member of the verdi National Executive Board, says that only employees with a secure job would be willing to help implement the drastic changes necessary in the Group.

Deutsche Telekom sees substantial need for action in the existing market environment - the customer expects good service and reasonable prices. This is reflected by market developments in the ITC sector. As such, service employees must be given better support by optimizing IT and processes. At the same time, the cost structure and productivity must be improved drastically. Salary levels and working hours are key factors in doing so.

Working conditions are to be brought into line with industry level to safeguard jobs within the Group instead of outsourcing to cheaper external companies. More employees are to be trained for future tasks, for example, with IP and PC training courses to secure services and jobs in the future.

Improving productivity will have a direct impact on service quality – by increasing service hours and the time available for customer contact. For customer centricity means focusing on customer requirements. And what customers want is more service, for example, at weekends and in the evening.

“We don’t want to sell the T-Service units to a third party or drastically alter employment conditions. We want to safeguard jobs within the Group and use our own employees to carry out the work that needs doing,“ said Mr. Welslau. “But one thing is clear – we can only achieve these goals if change is accepted. And I hope employees and the employee representatives will show this acceptance and support.“

The aim is to apply the idea of a company within a company that has already been successfully implemented in other areas. The intention is to create three independent subsidiaries in Germany that consolidate the Technical Infrastructure, Technical Customer Service and Call Center tasks. The possibility of integrating T-Mobile Deutschland’s call centers is also being reviewed. This would, however, not change anything for T-Mobile call center employees as they already have different competitive contracts that ensure that all employees have long-term prospects.

The new members of the T-Com Board of Management are to assume responsibility for the new T-Service units alongside their existing board departments - Thomas Berlemann for Call Centers, Roland Folz for Technical Customer Service and Friedrich Fuß for Technical Infrastructure.

Deutsche Telekom is basing its strategy on existing successful examples within the Group. T-Punkt Vertriebsgesellschaft, for example, will be creating 1,500 new jobs this year and opening 200 new shops. This means that the number of shops has almost doubled in the three years since the T-Punkt shops were spun off. 450 new jobs have also been created at T-Mobile Deutschland in the customer care area. All this was only possible because the necessary measures were taken at the right time together with the employee representatives and employees.

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