Recession Bug Hits Digicel
News an Tings - Business News

Confronted by the deepening global recession, mobile phone company Digicel has announced that it will make 450 voluntary redundancies across its Caribbean and Central America operations in order to restructure, seven-and-a-half years after its Jamaican launch provided a base for regional and worldwide expansion.

Digicel said that it had no target number of redundancies among its 831 Jamaica-based employees or individual markets, but that the job cuts would fall across 23 of its 31 markets and depending on where the volunteers come from. Staff across the region were informed of the redundancies yesterday and given a fortnight to respond.The redundancies represent 10 per cent of the Irish telecommunications company's total workforce of 4,500 and includes 20 per cent of its expatriate workers.

"Digicel has experienced phenomenal growth since its initial launch in 2001 and continues to evolve as a leading international mobile provider. We are now at a natural stage in our evolution to reassess our organisational structure, processes and to fully capture operational efficiencies," said Digicel Group chief executive officer Colm Delves in a statement yesterday."This is particularly relevant in the current challenging economic environment where all companies, including financially strong and fully funded companies such as Digicel, need to ensure that they have a lean and efficient structure to strengthen their financial position and protect plans for continued growth," said Delves.

Digicel believes that the voluntary redundancy package (VSP) offered to staff is sufficiently generous to allow it to avoid making compulsory redundancies. The VSP payment is based on years of service with the package including extended health cover, pro rata bonuses and accelerated payments for stock options. The company is also confident of staff acceptance based on previous VSPs offered elsewhere in the world.The three recently launched markets of the British Virgin Islands, Honduras and Panama are unaffected by the redundancies, as is its five-country Pacific operation - Fiji, Papua New Guinea, Samoa, Tonga and Vanuatu.Digicel overtook British Cable & Wireless (now rebranded as LIME) as the leading mobile provider in Jamaica, recording growth of 100,000 subscribers in its first hundred days of operation, but now faces a saturated market.

It is diversifying into other services, including fixed line, Internet and wireless television.Digicel now has approximately 1.9 million subscribers among a Jamaican population of 2.8 million; LIME 660,00 subscribers and MiPhone 220,000, before rebranding as Claro late 2008. Jamaica remains Digicel's largest market among its six million Caribbean subscribers.LIME announced last year that Jamaica will account for 100 of 1,200 staff cuts to be made across the Caribbean, ending this September as part of regional restructuring.Meanwhile, landline, Internet and cable provider Flow said that it could not confirm whether or not it will make positions redundant this year."

As Flow continues to build out our services across Jamaica, we will continue to find ways to increase operational efficiency, adjusting staffing patterns as necessary," Michele English, Flow president and chief executive officer, told the Observer yesterday. "We have successfully completed the build out in Kingston and made some changes in our construction workforce as a result. We will employ locally as we continue to build out other areas of
the country,"
Claro, which was expected to be adding additional staff this year, could not be reached for comment yesterday on a day that shares in its Mexican parent company America Movil fell 1.8 per cent.

 Source writer  Ross Sheil  

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