U.S. News

Government Pressures Deutsche Telekom to End Strikes: Report

Germany's government is putting pressure on Deutsche Telekom's chief executive Rene Obermann to end a dispute with trade union ver.di over plans to outsource 50,000 jobs into a new company, Handelsblatt reported, citing sources.

"In the next few days it should become clear how an end can be put to the strike staged by Telekom workers," the newspaper cited a source within the government.

As many as 15,000 workers have been on strike since May 11 to protest Deutsche Telekom's plans to transfer employees to its newly formed T-Service unit from July 1 in a bid to save up to 900 million euros ($1.2 billion) a year.

In order to push through its plans by then, Deutsche Telekom has to notify employees of their new salary levels and working conditions by May 31, Handelsblatt said.

But ver.di in April rejected an amended proposal by Deutsche Telekom that called for a 9% pay cut for service personnel over 3 years and longer working hours, with a guarantee there will be no redundancies until end-2011.

The German government is Deutsche Telekom's biggest single shareholder, with a 32% stake, the newspaper said.