Telecom has played down a media report it may be outsourcing 1500 call centre jobs to the Philippines, saying trials are limited to 140 staff.
But an internal memo obtained by the Business Herald yesterday acknowledged the move could potentially affect one-third of call centre staff or around
500 workers, an amount that would cause significant one-off costs and substantial savings in the future.
Any savings would be warmly welcomed by investors who have seen Telecom's share price slip as low as $3.28 on July 3. Shares rose 9c to $3.68 yesterday.
The company has already unveiled medium- and long-term plans for restructuring.
Forecast savings from a major outsourcing plan will bring an extra frisson to grim annual results to be released next week.
"Telecom have talked about medium- and long-term profit gains," said Forsyth Barr telecommunications analyst Guy Hallwright.
"But like all companies in the current market there is a hope for some positive short-term developments.
"In Telecom's case a lot of negatives are already out there, so people will be hoping the next results will include at least nothing negative."
Telecom spokesman Mark Watts said the report of up to 1500 job losses overstated the scale of trials.
He said 140 jobs were under trial.
But the memo to staff which addressed the media reports said: " In reality, even if all the functions to be trialled were outsourced in their entirety, this would represent less than a third of this number."
Watts said Telecom used 1400 customer service workers in Auckland, Hamilton and Christchurch.
"In Manila with our partners Teletech and Sitel we currently have 450 permanent positions, helping to answer queries on broadband and dial-up internet among other things."
In April, Telecom announced an outsourcing trial of 40 jobs and Watts said that last week it announced that a further 100 customer service roles would be added to that trial.
Telecom told staff it had been up-front with them and with investors about the intent to investigate outsourcing opportunities.
Watts said outsourcing was decided on the basis of cost savings and customer experience.
He said some technical queries such as the faults services were remaining in New Zealand.
