Aircel, a cellular service major announced the termination of its 10% pan-India staff strength i.e. around 700 employees. The move was a part of the first stage manpower downsizing.
As per the media reports, these are the first set of redundancies identified by Aircel to reduce the duplication of human resources meanwhile preparing for the possible merger with Reliance Communications (RCom). The company provided around a week's time to its staff members to agree to the company's compensation package which included February’s full month salary and the basic pay to allotted for next six months.
When contacted Aircel, they responded with the following official statement, “The recent news report regarding rationalization of jobs at Aircel is speculative and misleading. We would like to emphasize that amidst all that is happening in the sector, our focus is to build a profitable company, keeping the best interest of our customers and people."
There is a fear in the market that more such jobs cuts will loom the telecom sector in the near future and this can be attributed to the large wave of consolidation going on in the sector. The situation aroused when the sector was thrown open to the non-state companies in 1995.
Prashant Singhal, the global telecommunications leader, shares three direct reasons for disruption in the telecom landscape in India. First reason is the entry of a new player in the market i.e. Reliance Jio, second -consolidation and third is demonetisation. He adds, “Unfortunately, these three factors are happening at the same time. So, direct and indirect job rationalization will happen."
At present, Aircel has around 8,000 employees in India.
Source : Economic Times