No extra bonus pay for MTN staff

Johannesburg - South Africa’s second biggest mobile network MTN has poured cold water over staff hopes for bigger bonus pay this year.

Slowing voice revenues and competition have hit MTN’s financial results in the last year.

Earlier this month, the company reported that the contribution of voice to its total revenue declined by 2 percentage points to 61.2%. Meanwhile cuts in termination rates in South Africa contributed to MTN Group’s interconnect revenue falling by 2.9%.

Since last year, the company has been embarking on staff retrenchments and it is now curbing bonus pay.

Last week, Fin24 reported that service consultant staff at MTN embarked on an unprotected strike over receiving a bonus of 4% of their annual salaries this year. This figure is said to be lower than previous bonuses of 30% of their annual salaries. The striking staff also called for a thirteenth cheque or an ex gratia amount above 4%.

But MTN this week has confirmed that it is not budging on bonus pay, and the company also issued a press statement on Monday evening saying that there will be "no additional performance bonus payments to employees for the 2014 financial year".

“The whole organisation did not meet the bonus targets for 2014,” Themba Nyati, MTN’s Chief Human Resources Officer, told Fin24 on Tuesday morning over email.

“Obviously everyone is disappointed that bonus targets were not met, however, our people are resilient and are planning to exceed the targets for 2015 in order to get huge bonuses next year.

“There are factors that have contributed towards the inability to meet targets such as tariff reductions, introduction of new business models and other related company performance issues,” Nyati told Fin24.

Nyati further explained to Fin24 that level 1 and 2 staff at the company “received their guaranteed 4% bonus”, but he reiterated that the whole company failed to meet its 2014 bonus targets.

The statement issued by MTN on Monday evening also said that of the 22 operating companies evaluated for performance bonuses at the company, “only 15 entities qualified for payments and seven, including MTN SA, did not qualify for any performance bonus payment”.

MTN has an estimated 7 000 employees in South Africa.

The mobile network has 26 million subscribers in South Africa and is the country’s second largest telecoms player after Vodacom.

MTN, though, is Africa’s biggest mobile network company with over 50 million subscribers in Nigeria - a figure that forms part of the company’s over 200 million users across its entire Africa and Mideast operations.

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