Deutsche Telekom wage cut call
HAMBURG, Germany (Reuters) -- German phone giant Deutsche Telekom will propose a 10 percent wage cut for around 100,000 German employees in next year's wage talks, a board member said in remarks embargoed for Tuesday.
The phone carrier will propose cutting weekly worktime to 34 hours from 38 hours and reducing wages by the same proportion, Heinz Klinkhammer, head of human resources, told journalists.
The wage cuts and other measures, including a cut in trainee jobs and trainee wages, are part of a plan dubbed "Job Pact Telekom" and would translate into annual savings to the tune of a mid-triple-digit million euro amount, Klinkhammer said.
Analysts estimate a 10 percent wage cut would lead to annual savings of about 500 million euros.
Deutsche Telekom, which employs more than 250,000 worldwide, is already in a drive to cut over 40,000 jobs by the end of 2005 by moving German staff into a unit that seeks new jobs for them inside and outside the company, and by shedding jobs abroad.
In return for the wage cuts, the carrier will propose to the Verdi union that the job cuts be achieved without forced redundancies in Germany, extending an earlier ban on forced redundancies beyond 2004, Klinkhammer said.
The current wage deal expires in May 2004.
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