Vodafone Cuts Thousands of Employees and Raises Annual Salary by Millions

Foreign media reported that according to the annual report just released by Vodafone, Vodafone's executives increased their annual salary by millions of euros, and in the latest fiscal year, they cut thousands of jobs worldwide.Data released over the weekend showed that Vodafone cut 5421 jobs in the fiscal year ended March, nearly 5% of its total employees (only partially due to the divestment of its Dutch business).This layoff occurred later this year. After Vittorio Colao resigned from the post of CEO, his overall salary rose to nearly 8 million euros (9.4 million US dollars), which was partly due to the payment of bonuses. His salary was about 6.3 million euros (7.4 million US dollars) a year ago.

CFO Nick read will replace Colao as Vodafone's boss. He has also achieved considerable revenue growth, from 3.6 million euros (US $4.2 million) to about 4.5 million euros (US $5.3 million).Based on the improvement of Vodafone's profitability and the success of early network operation investment, the salary increases of Colao and read are not surprising. And they will certainly not be as controversial as Gavin Patterson, CEO of BT group, who is under pressure from shareholders due to poor management.However, as an efficiency driver, this act of rewarding Vodafone executives still seems to have moral implications for critics. This may lead to the disturbing fact that company bosses are getting richer and richer, while automation, industry consolidation and the pursuit of greater profits force others to lose their jobs.

Another example of a telecommunications company is the U.S. - based cythurylink, which also announced a generous compensation agreement with the outgoing CEO and plans to slash staff.Vodafone divested its business in the Netherlands and merged with the cable business owned by liberty global at the end of 2016, which seems to be the detailed reason for the large number of layoffs in the operator's annual report. But even if the Dutch business was excluded, the number of people fell by more than 2300.A set of data shows that Vodafone has an average of 106135 employees in the latest fiscal year, compared with 111556 in the previous year. The other group, excluding the Dutch business, has 103564 employees, compared with 105870 a year ago. Vodafone did not explain the decrease in the number of people in its annual report unrelated to the merger.

But Vodafone recently attributed the sharp increase in profitability to cost cutting efforts. Although revenue in the most recent fiscal year decreased by 2.2% to 46.6 billion ($54.6 billion), its operating profit increased by 15.4% to 4.3 billion ($5 billion).According to the first group of population data, Vodafone's number of employees in Italy and Spain is relatively stable, but the operator seems to have cut 760 jobs in Germany and 859 jobs in the UK. The reduction accounts for about 5.2% of the German labor force and 6.5% of the UK labor force.It also has more than 2000 layoffs in India. Vodafone merged with its local competitor idea cellular to create a new market leader.

The number of employees in Vodafone's common functions increased by more than 3000 to about 24400, which helped offset the number of layoffs elsewhere.Like other major telecom companies, Vodafone is trying to automate and digitize operations to meet new business challenges and customer needs, although a spokesman previously said that automation is mainly to improve customer service, not layoffs.Vodafone released its full year data last month, saying it has great potential in automation in it and network operations, background functions and other management fields. It has established an "automation unit" in its shared service center, which shows that about 200 "robots" are operating in the unit in the first three months of 2018.

The salary data released by Vodafone also shows that the average salary of the whole group has decreased; This may be the result of divestment of the Netherlands.Vodafone's annual report shows that the wage and salary expenditure in the latest fiscal year decreased to 4.179 billion euros from 4.630 billion euros last year. These figures mean that wages and salaries per worker decreased from 41500 to 39400 during this period, and Vodafone's contribution income per employee increased from 426700 to 439000 during this period.However, the salaries of Vodafone's senior executives have risen sharply. Although Vodafone's share price on the London Stock Exchange has fallen by 11.5% in the past 12 months, Colao's overall salary has increased by a quarter.

Bengt NORDSTR m, chief executive officer of northstream consulting, said, "Colao deserves praise for the operational improvement of its subsidiaries. Although the performance of the stock price is not very good, he (Colao) has solved some problems, such as network investment."