Israeli cellular provider Cellcom layoffs 140


Cellcom, one of Israel's leading cellular providers, is set to cut its workforce by 140 employees following the merger with Israel's oldest established internet service provider, Netvision.

Calcalist has learned that the layoff round aims to remove duplicate positions in the corporation; however, it is likely that Cellcom will take the opportunity to streamline its workforce in response to the current turbulence on the cellular market.

Cellcom's archrival, Partner Communications, recently conducted a layoff round. But as it has twice as many employees than Cellcom, the company – owned by businessman Ilan Ben-Dov – has more downsizing leeway.

Cellcom's bottom line eroded in the third quarter with a 40% tumble to NIS 199 million (about $53 million) net profit.

But the company was not the only one to see its net profit shrink as other companies grapple with reduced connectivity fees and tariff devaluations stemming from growing competition – a trend expected to grow once the new competition hits the market.

Layoffs at Cellcom come after incumbent CEO Amos Shapira announced his wish to step down from the helm of the company, owned by businessman Nochi Dankner. Netvision CEO Nir Stern has been nominated to replace Shapira as CEO.

Cellcom said in response, "The company has begun implementing the Netvision merger in order to create a strong, efficient and leading communications corporation which can offer a whole gamut of top-notch communications solutions.

"The group's structure of operations, as formulated by work teams from both companies in collaboration with McKinsey, will include the consolidation of both headquarters and the relocation of Netvision's administrative workers to Cellcom's headquarters; the consolidation of the companies' customer service array to a one-stop-shop for the group's complete line of products and services.

"Furthermore, private customer services will not be consolidated in order to maintain the group's targeted clients in light of mounting competition and upcoming challenges in the landline market once it is opened to competition. The company will preserve its sales and service representatives array in order to uphold its high standard of service.

"In a forward looking approach and aiming to preserve as many employees from both companies as possible, we are not filling administrative positions that had recently opened up. Most of the administrative staff ending their job due to the merger are employees in duplicate positions that could not be placed in other positions within the corporation, We're talking about 140 employees from both companies who will end their contract after a due hearing.

"We are doing our utmost to assist the employees to find new jobs; we are employing two job placement companies to support them with comprehensive consulting in locating new positions. The placement companies will be awarded special incentives for each employee they place in a new job.

"Furthermore, employees will enjoy better retirement benefits then in their original contract and will receive compensation in addition to the severance payment they are entitled to in their contracts.

"We view each employee as a whole world unto themselves and we are sorry for the pain involved. However, the overall perspective of a merger between two companies which have thousands of employees necessitates such a move."

Source: YNET News