France Telecom, which has seen 25 employee suicides since the beginning of 2008, expects to spend up to 1 billion euros on initiatives to ease employee tensions.
That was the word on Thursday when Europe’s third-largest telecom provider reported its third-quarter earnings. And thanks to lower customer spending, regulatory rulings and currency exchange rates, France Telecom’s profit dropped 8 percent – more than analysts expected. The numbers fell from 4.95 billion euros a year ago to 4.56 billion euros.
Still, margins stayed stable because the carrier cut down on network investments, part of the reason so many workers are distraught.
To be sure, France Telecom has been forced to halt its restructuring efforts while it negotiates with unions and tries to assuage worker fears over the formerly stated-owned operator’s more capitalistic bent.
But executives say the suicide spiral isn’t hurting France Telecom’s sales numbers. The company’s finance director told Reuters France Telecom could craft a part-time work schedule for older employees that would hurt 2009’s results but “have a positive effect on subsequent years.”
Meanwhile, France Telecom maintained its 2009 cash-flow target.