Telefónica Announces Redundancy Plans Amid New Strategic Cost-Saving Initiatives

Telefónica’s management, covering its various divisions including Telefónica de España, Telefónica Móviles, and Telefónica Soluciones, has formally communicated their intent to initiate a redundancy plan (ERE) affecting a significant number of employees. Unions have reported that while the exact number of positions to be cut has not yet been disclosed, early estimates suggest that between 6,000 to 7,000 workers may be impacted. The unions, particularly UGT, have promptly expressed their disapproval of the redundancy plans, criticizing the company for resorting to workforce reductions as a primary method of organizational restructuring. They are set to initiate negotiations in good faith to address these layoffs, which they label as an unfortunate but necessary step in light of the company's new strategic plan. The timeline for the official communication of layoffs is precise, with Telefónica indicating that employees and unions will receive finalized figures by November 24. Following this, the negotiation process will commence, adhering to legal requirements set forth in the Workers’ Statute. Unions are vocal in their opposition to the ERE, calling for negotiations to extend collective agreements until at least 2030 to ensure labor stability. They reject the notion of partial agreements and firmly state that any redundancy strategy must assure future job security for remaining staff, underlining the importance of voluntariness in the exit process. In addition, the Sumados-Fetico union has called for a universal and non-discriminatory ERE, aiming to provide fair exit conditions for affected employees. Historical context highlights that the last redundancy plan led to 3,420 job cuts, with costs amounting to approximately 1.3 billion euros before taxes—a significant expenditure for the company. Telefónica's restructuring comes amid a broader strategy aimed at saving an estimated 3 billion euros by 2030 and 23 billion euros by 2028, with a large portion of the savings linked to personnel costs. The company's CEO, Emilio Gayo, reaffirmed the commitment to work alongside worker representatives during this process to ensure transparency and collaboration. As the situation develops, it reflects not only the challenges faced by Telefónica amid cost-cutting measures but also the ongoing struggle of labor unions to protect workers’ rights and ensure stability within the workforce. Related Sources: • Source 1 • Source 2