Talks between Deutsche Telekom (DT) and the service union Ver.di broke down last week, and strikes could be the next step at Europe’s biggest telecomscompany. The union will call for a strike vote in the next fortnight. Ver.di rejected DT’s offer to delay layoffs at its T-Service unit until 2011 in exchange for subsequent wage cuts by 9% until 2010 and an increase of work hours to 38 per week. DT had offered to drop its demand that staff must work up to 100 hours overtime to fill the gaps during busy times. Chief Financial Officer Karl-Gerhard Eick said ‘(With this offer) we have exhausted our possibilities,’ in a statement. So far, there have been three brief strikes by workers, lasting no more than a few hours, but if the strike is approved it could lead to a major walkout.
The issue centres on the German incumbent’s desire to transfer up to 50,000 staff to a new service unit, dubbed T-Service, in a move that would allow the company to amend employment contracts to secure more hours and lower pay, as part of its wider cost-cutting plan to remain competitive. This is opposed by the union, which wants the company to guarantee jobs for a certain number of years. Under German law, a company must have union approval if it wants to implement changes to its work force. DT employs approximately 160,000 people in Germany.