O2's Outsourcing Plans Spark Anger - InformationWeek

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IT Leadership // IT Strategy
12:06 PM

O2's Outsourcing Plans Spark Anger

Spanish telco's U.K. brand, O2, says it doesn't need as many call center staffers to help customers since the rise of the smartphone. But its plans for dealing with that change have been fiercely attacked.

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U.K. mobile and broadband customers are being asked to protest against plans by the British arm of European provider Telefonica, O2, to outsource call center jobs.

A new online petition claims that a "large proportion" of affected employees are young people living in already high British unemployment areas such as Leeds, Bury, Glasgow and Preston Brook.

"They all face uncertainty for their futures and feel utterly betrayed by the stark reality of what the company is doing," states the petition, which calls on Telefonica U.K. CEO Ronan Dunne to reverse the plan, which has sparked anger. Wrote one petitioner, "I for one will move both my mobile numbers away from O2 in the next few weeks," and another said, "O2 makes billions in profit and opts for the lowest common denominator for staff. [This action] is unethical and unacceptable."

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Last week, O2 announced plans to extend an outsource arrangement with supplier Capita in a 10-year, £1.2 billion ($1.8 billion) plan to take over the running of its customer service centers.

The move comes after what the mobile service operator says has been a drop by a million in monthly customer calls from customers compared to two years ago, as British smartphone users prefer contact through apps or social media instead. O2 says it is investing £50 million ($75 million) in new digital customer services in response.

But the outsourcing deal has been roundly condemned by staff and unions, with one local press report in a town affected by the move claiming, "02 staff feel totally and utterly betrayed. 02 is just cost-cutting when their profits are up. They are selling out on the very people that made them the success they are today." A union that represents workers in the call center sector, the CWU, says it might push for national strike action.

Between 600 and 1,000 staffers -- figures vary between the parties -- might lose their jobs, while over 3,000 will transfer to what the union says are poorer-paid jobs with inferior job conditions. The average salary of current O2 call center staff is about £10 ($15) an hour, while staff doing the same job in at least one Capita facility are paid about £7 ($11).

The petition had been signed by just a few hundred people at the time of this writing. But a strike and additional negative headlines could turn what might have seemed to Telefonika as a rational business decision into something much more political and complicated.

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