O2 Retail Transformation – franchise of 82 stores

The CWU has been informed that Telefónica O2 UK Ltd intend to franchise out 82 stores from its existing 450 store estate in order to transfer the risk and cost associated as part of a cost cutting exercise.

 The CWU has expressed our dismay at this announcement and despite asking for a delay in order that meaningful consultation can take place the business has decided to press ahead.

Those 412 CWU grades in scope will be subject to a Transfer of Undertaking (TUPE) but the CWU has concerns how job security and terms and conditions of employment will be protected going forward.  Whilst we are assured that all of the affected stores in scope are running at a profit we have no understanding how the new franchise owners will continue to keep these stores in profitability.

The Company have stated that the CWU will receive the rationale of the financial challenges facing Retail, the requirement for the Company to think differently about the estate and the commercial decision to franchise some of the stores in the context of Retail’s three year commercial challenge. 

The CWU understands how worrying this news will be to the CWU members that are directly affected and we are hugely disappointed that O2 believe franchising out of existing stores is their only alternative.  The union is not convinced that this is in the interest of either the employees or Telefónica O2 UK Ltd.

The Company will be working with the CWU on the people-related issues which will be a lengthy consultation of over five months.  However the principle remains that the CWU has major reservations with this programme and sees it as a crude cost-cutting exercise.  We believe that this announcement will do little to instil any confidence or morale amongst all of our Retail members over the busiest time of the year.

We will however continue to keep you updated as developments occur.  If you have any questions contact details of your local representative can be found along with all O2 Newsletters on http://www.cwu.org/24120/o2.html.

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