Cellular services major Aircel is all set to give pink slips to 700 staff - around 10% of its pan-India staff strength - in its first stage of manpower downsizing amid a huge wave of consolidation that is going to engulf India's telecommunication sector. Aircel has around 8,000 employees in India.The Wednesday shocker to the Aircel employees is probably the first of the many such announcements awaiting India's telecom sector, feel experts.
A source close to the development in Aircel told TOI that this would be the first lot of people who have been given around a week's time since last Friday to agree with the company's compensation package, which includes full month's salary in February and just the basic pay of the following six months.
"The entire exercise is being aimed at reducing duplication of human resources with the possible merger with Reliance Communications (RCom). The circle teams as well as corporate base are being resized now with an eye on cost restructuring," added the source. The Gurgaon-headquartered mobile network operator has first taken a stock at its circle strength and then started serving termination letters to its sales and network team members across the country.
"In the coming 7-8 months, we are planning to go slow on all segments as more stages of job cuts are on the cards," said an insider at Aircel. The next stage of job cuts, according to sources, would be done in April.
However, the Aircel spokesperson in Gurgaon didn't respond to the TOI queries on this job cut issue sent via email. On the possible reasons for this job cut, Prashant Singhal, the global telecommunications leader at EY said:,"There are three direct factors which are disrupting the telecom ecosystem in India. These are: entry of new player (Reliance Jio), consolidation and demonetisation. Unfortunately, these three factors are happening at the same time. Obviously, there will be an immediate impact. So, direct and indirect job rationalisation will happen."
According to experts, nearly a third of the three lakh direct and indirect jobs in the whole telecom industry will be made redundant amid consolidation wave.
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