KT Restructuring
KT will slash 8,000 jobs through a voluntary retirement program. The number is the highest ever done by a local company, which accounts for about 25 percent of a total of 32,000 jobs.
The nation’s second-largest mobile carrier announced on April 21 that 8,320 employees have applied for early retirement since April 10. The figure is the highest out of three voluntary retirement programs conducted by the carrier since 2003. Previously, 5,505 workers applied for early retirement in 2003, and 5,992 people in 2009.
The firm is planning to announce new staff appointments on April 30, after a personnel committee discusses the matter on April 23.
As agreed by labor and management, employees who have worked for over 15 years are eligible for early retirement. The average age of applicants is 51, and the average number of years of service is 26. By age, people in their 50s make up the largest percentage of the total with 69 percent, followed by those in their 40s with 31 percent.
KT is going to help some of retirees get a job at some of its subsidiaries. In addition, it is planning to offer programs that support people who want to start a business or to provide consulting services for re-employment to ensure that they can plan their lives after retirement. If all applicants retire, the number of KT employees will decrease from 32,188 to 23,868. The average age of workers will also be lowered to 44.5 from 46.3.
The carrier anticipates that it could save around 700 billion won (US$673 million) in labor costs per year because of job cuts, although business expenses in the second quarter are expected to increase temporarily owing to a one-time expense for severance pay. KT is planning to let affiliates streamline its business operations so that customer services will not be affected by the downsizing. The company is going to make other business units more efficient and to reorganize its business as well.