Sunrise UPC is cutting staff as a result of its recent merger, despite initial talk of new opportunities.
The Swiss telco did not specify how many jobs will be affected, but puts the number at “significantly less than 30%” of its current employees. At the end of the third quarter Sunrise had 1,763 full-time staff while UPC says it employs around 1,500 people, which means that those let go could number close to 1,000…or less.
It could be some months before we know exactly how many staff will be affected though. Sunrise said the new organisational structure of the merged Sunrise UPC is being decided, with the selection process for management-level roles underway.
“This process is expected to result in job cuts and will take until April,” Sunrise said. It is unclear whether we can surmise from its choice of words that jobs affected will mainly be management positions. At that point, the companies will know exactly how many jobs they will cut as a result of the integration, with the majority of employees having clear direction on their future role by the end of June, it said.
That’s quite a long wait for quite a lot of people. In the meantime Sunrise said it has launched a consultation process and is engaging with trade unions to support affected employees.
Job cuts should come as no major surprise when two sizeable companies merge – not that that will be much comfort to Sunrise’s staff right now – but this latest announcement is a far cry from the upbeat tone in which the firms in question announced their tie-up in August.
“We look forward to welcoming Sunrise employees to the Liberty and UPC family and congratulate them and the board on their success,” said Mike Fries, chief executive of UPC’s parent company Liberty Global, at the time. Funnily enough, he didn’t mention that the welcome didn’t apply to all of them.
The chairman of Sunrise’s own board of directors, Thomas Meyer, made a similar comment following Liberty Global’s buyout offer. “The Board believes that the offer is in the best interest of our shareholders and will create opportunities for the Sunrise employees to be part of a fully converged national champion,” he said. Again, those opportunities will be limited for some.
Liberty Global offered CHF 6.8 billion ($7.4 billion) in cash for Sunrise just under a year after Sunrise’s attempt to buy UPC Switzerland was derailed by opposition from minority shareholder Freenet, despite regulatory support. The deal closed in November.
Although Sunrise was the acquired party, Liberty Global immediately named its recently-appointed CEO André Krause as the new chief executive of Sunrise UPC; Krause had served as Sunrise CFO since 2011 before taking over as CEO at the start of 2020 following the departure of Olaf Swantee.
“I am glad that we have been able to work out an extremely solid social plan for Sunrise UPC thanks to the good and constructive cooperation with the syndicom trade union and both employee representations. This ensures that the employees concerned are not just financially supported,” Krause said on Thursday. As well as providing professional support to employees affected by the job cuts, Sunrise UPC has pledged to set up a CHF 2.5 million ($2,800) fund to finance training or address individual hardship cases, it said.
How far that fund will stretch will depend on how many staff get the chop, of course. It could be a long six months for some.