In an internal memo sent out today by Shaw president Jay Mehr, the company answered staff questions regarding the massive 6,500-employee buyout offer announced last week.
The memo, provided to MobileSyrup by an anonymous source, addresses the uncertainty employees felt after receiving the offer. In MobileSyrup‘s article published last week, one unnamed employee reported that there was no internal trust that the company would reward loyalty if workers chose to stay.
Under the heading “If I choose to stay, will there be mass layoffs anyway?” Mehr writes: “If you choose to stay, you’re committing to us and we’re committing to you.”
He adds that while Shaw can’t guarantee there won’t be further restructuring, it can guarantee there will be no mass layoffs during its “multi-year Total Business Transformation.”
Further, if some “case-specific” lay-offs do occur, Shaw commits to offering a “generous package similar to what’s being offered through the Voluntary Departure Program.”
“If you choose to stay, you’re committing to us and we’re committing to you.”
In its press statement on January 30th, Shaw said it expected 10 percent of the 6,500 employees to take the buyout offer as it transitioned toward offering more self-installed services and app-based customer care.
The package is reportedly six months of compensation plus one month per every year spent at the company, paid in a lump sum.
Internal sources who communicated with MobileSyrup last week, however, said they expected the percentage of employees who planned to accept the offer would be closer to 25 percent. Although it’s unclear how many employees have taken the offer so far, Shaw now says it’s giving employees the opportunity to “re-assess” their decisions before the February 14th deadline.
“My personal opinion is that they didn’t expect the uptake in the program and/or the general negative effect it had on staff opinion,” one long-time employee told MobileSyrup after receiving the new memo.
Unlike the investment community, MobileSyrup‘s sources were concerned that the buyouts were a sign of trouble for the company, another issue addressed by Mehr in the memo.
“What we do now we do very well. Our balance sheet has never been in better shape, we have the right set of assets, and we are anchored by core businesses that are profitable and healthy. Our growth engines in Wireless and Business will allow us to return to a strong growth trajectory overall.”
Notably excluded as a “growth engine” is Shaw’s cable business, also known as wireline, which includes video, internet and phone. Its last earnings report made it clear wireline was not performing particularly well for Shaw.
“My personal opinion is that they didn’t expect the uptake in the program.”
Shaw reported a decrease in individual wireline subscribers of 33,851 in the first quarter of fiscal 2018, compared to a 30,432 loss from the same time a year previous.
The company attributed the decrease in part to a reduction in promotional activity and more selective retention offers, particularly with cable video customers, as well as higher seasonal satellite video losses.
According to forums and internal sources, many of the employees offered buyout packages worked in non-customer facing roles, including installers and engineers.
Meanwhile, wireless performance headlined that report, with Shaw noting that Freedom Mobile gained 130,000 subscribers in 2017 and 34,000 in the first quarter of fiscal year 2018 alone. In total, company-wide revenue totaled $1.25 billion for the three month period ending November 30th, 2017, a 2.7 percent increase from the $1.22 billion during the same period last year.
Mehr also detailed the reasoning behind the buyouts at more length in the memo.
“What we do now we do very well.”
“Our position of strength provides us a historic opportunity to disrupt and set ourselves apart from the ‘The Big 3’ in the way we operate and serve Canadians,” he wrote, later adding: “To do this, we need to build a more nimble, flat, and digitally-enabled organization.”
The Shaw president notes that this “revolutionary shift” and the future of Shaw may not appeal to everyone, however. He also says working at the new Shaw will “undoubtedly be a major opportunity to grow and contribute.”
Mehr says even if employees don’t intend on staying with Shaw forever, they will have “participated in and contributed to what is sure to be a legendary accomplishment.”
The memo states employees will have the opportunity to ask further “hard questions” of senior leaders at Town Hall sessions this week in its major centres.