Uganda’s biggest telecom company MTN has dismissed 109 employees especially the long serving staff in a move that has been seen as a way to free up top positions of people who have been getting huge salaries and benefits. According to sources, when the new CEO Win Vanhelleputte took office last year, he took time off to talk to a majority of mid-level managers, supervisors and several employees to inquire about what they felt about the company and how they can reverse the declining state of the company.
There was over an whelming response from the employees among other things, who complained that several top managers had stayed in the same positions for over 15 years leaving no room for growth, which has led to low motivation and less room for career advancement for them. The CEO reportedly directed the GM Human Resource to look into the matter and how it could be resolved putting the company’s goals in mind.
According MTN’s official statement, the company confirmed the layoffs and called it a “Voluntary departure programme” that all employees were aware of and that the voluntary exit was demanded by the long-serving employees who expressed to move on from MTN and give desire to their personal lives. The Official statement went on further to state that “Only permanent staff who have been in employment with the company for over 12 years were eligible to benefit from the plan. They were given the opportunity to express their interest not later than 12 January “.
However this blog has learnt that some of the long-serving employees like the current Head of Mobile Money (MFS), Mr Lubega Phrase (image below) who has been a longtime employee of the company; was forced to resign due to internal politics and performance related issues.
Retiring of senior management world-over is a common practice, since they are more expensive and the company would be more profitable by recruiting cheaper ones, a practice some telecos like Africell have already adopted since they took over Orange Uganda.
Hefty severance packages
Some sources we spoke to at MTN, confirmed what was in the company’s official statement that indeed, they were informed via email about the layoffs in December 2016 and that everyone who was interested was supposed inform the Human Resource department by January 31st 2017. The company had promised to remit a certain allowance that would be calculated based on one’s salary and the number of years they have worked for the telecom giant. Only 34 staff requested to benefit from the voluntary departure programme who were offered a hefty departing package.
According to new vision, some senior managers who were earning about UGX 20 million and have worked for a minimum of 12 years, got up to UGX 300m. On top of that, the staff were also allowed to go with the company’s phone numbers but will have their tariffs changed to a usual MTN customer’s tariff by March. Each employee was entitled to a 3-months severance and additional 3 months bonus (6 months of full pay). In addition to that, for each year worked, a departing staff member got half the salary they earned as monthly salary whether this was subject to taxation was not disclosed.
The biggest percent of affect employees come from the customer care department, with over 40 people leaving.