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After job cuts, Telus CEO trims pay in COVID-19 response

It will hardly console workers who lost their jobs in the last bout of restructuring, but Telus CEO Darren Entwistle has become the latest telecom boss to give up his salary for several months in response to the outbreak of COVID-19.

In a short statement published on the Canadian telco's website, Telus said that Entwistle's salary for April, May and June would be donated to Canadian healthcare workers "on the frontlines, battling COVID-19." That sum will be matched in a contribution from The Entwistle Family Foundation, a charity the Telus CEO set up in 2018.

The move comes after Philip Jansen, the CEO of UK telecom incumbent BT, announced earlier this week he would donate his entire salary for the next six months to the country's National Health Service as well as smaller businesses affected by the coronavirus pandemic. Managers at cable giant Liberty Global have also caught the altruism bug. Directors will contribute $2 million out of remaining 2020 salaries, including $1 million from CEO Mike Fries, to a fund for employees and families affected by COVID-19.

The efforts are welcome and should increase pressure on other telecom chiefs to make similar gestures of support. Executive pay has been rising at many telecom operators as jobs have been cut. In one of the most egregious examples, Timotheus Höttges, the CEO of Germany's Deutsche Telekom, enjoyed a 13% rise in total compensation last year, to about €6.1 million, as more than 5,100 jobs disappeared. Concerns about automation and inequality were already airborne. COVID-19 has made them acute.

Entwistle may have been under some pressure to act. Accounts show that last year he collected nearly C$12.1 million (US$8.6 million) in total compensation, about C$390,000 ($277,500) more than he made in 2018. While headcount at Telus rose dramatically over the same period – from 58,000 to 65,600 employees – the increase was a result of takeover activity that brought another 9,500 members of staff, mainly outside Canada. That means the company actually shed about 1,900 roles.

Some commentary is available in the management's take on financial performance last year. Discussing a headline increase in employee-related expenses, the report goes on to say: "This was partly offset by moderating salaries expense resulting from reductions in the number of full-time equivalent domestic employees, excluding business acquisitions, related to cost efficiency and effectiveness programs."

But Telus is not the only Canadian operator with a shrinking workforce. After bucking international trends and adding to headcount in 2017 and 2018, rival Bell Canada slashed about 700 jobs last year, leaving it with 52,100 employees. Smaller Rogers Communications cut even more deeply into its workforce, removing 800 jobs to finish the year with 25,300 employees. The operator mentions efficiency programs several times in its recent annual report but makes no specific reference to job cuts.


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Bosses at Rogers and Bell Canada have also boosted their pay packets. Joe Natale, the CEO of Rogers, fattened his compensation by around C$154,000 ($109,600), pocketing more than C$11.7 million ($8.3 million) in 2019. Mirko Bibic, his equivalent at Bell Canada, took home about C$12.6 million ($9 million), around 5% more than he collected in 2018. That is equal to overall labor costs for about 145 employees.

In total, some 3,390 jobs were cut across the "big three" operators in 2019, a figure that equals about 2.3% of total headcount, including ADT Canada and Competence Call Center, the large businesses that Telus acquired in its last fiscal year. The outlook for 2020 is already bleak. Rogers has temporarily shut down many of its retail outlets and warned investors the financial impact of the coronavirus "may be material."

All three companies have announced support programs for customers and made charitable moves since the virus struck Canada. Data on April 9 showed the country had recorded some 19,438 infections, including 435 deaths, and the numbers continue to rise. After Entwistle's latest donation, and the revelations about executive pay and layoffs in recently published financial reports, Natale and Bibic would do well to respond.

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— Iain Morris, International Editor, Light Reading

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