Telkom Executive Directors’ Pay Doubles as Job Cuts PlannedRenee Bonorchis
Telkom SA SOC Ltd., the South African landline operator that’s embroiled in a fight with unions over a plan to cut jobs, more than doubled its executive directors’ wage bill in the 2015 fiscal year.
Total compensation for Chief Executive Officer Sipho Maseko rose 5.1 percent to 12.3 million rand ($977,000), former Chief Financial Officer Jacques Schindehutte received 18.8 million rand compared with 6 million rand a year earlier, and Schindehutte’s replacement was paid 8.7 million rand, according to the Pretoria-based company’s annual report for the year ended March 31, released Monday.
Total pay for the three was 39.8 million rand compared with 17.7 million rand for executive directors in fiscal 2014. Net income declined 17 percent to 3.3 billion rand, Telkom said June 8. The operator declared its first dividend since 2011 after cutting debt by 92 percent, even as voice revenue shrank.
Telkom, about 40 percent owned by the South African government, is seeking to cut approximately 4,400 jobs, or more than 20 percent of its workforce, through voluntary severance and early retirement. Following a dispute with unions including Solidarity, a labor court on July 8 ordered Telkom to retract its restructuring proposals and reach a settlement with the workers’ groups before proceeding with its plan.
“Given the massive retrenchment process at Telkom, we are aggrieved that Telkom has squandered so much money that could have been used to keep experts in its employ,” Marius Croucamp, a spokesman for Solidarity, said Tuesday in a statement.
Schindehutte was suspended in October 2013 and opted to take early retirement in August last year. For the five months of fiscal 2015 that he was still an employee, he was paid a guaranteed salary of 6.5 million rand and fringe and “other benefits” of 12.2 million rand, according to the annual report. This included short-term incentive payments from fiscal 2014, long-term incentive payments for 2014 and 2015 and 656,181 rand for 25 accrued leave days.
“The average technician employed by Telkom earns about 20,000 rand per month before deductions,” Solidarity said. Schindehutte’s compensation could have paid the salaries of about 80 technicians for a year, the union said.
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