In an effort to streamline its corporate operations after acquiring Shaw, Rogers Communications (TSX: RCI.B) is providing voluntary severance packages to its employees.
The completed $26-billion deal in early April marked a significant milestone for Rogers, and CEO Tony Staffieri expressed in a memo to staff on Tuesday that the integration of the two companies is progressing smoothly. However, he emphasized the need to eliminate redundant positions within the combined organization.
“As part of our integration efforts, we’ve been thoughtfully looking to optimize the organizational structure of the combined company and address some overlap in roles,” Staffieri said.
Typically, companies achieve cost savings by reducing positions in departments that can be consolidated, such as marketing, accounting, and human resources. Rogers, based in Toronto, anticipates approximately $1 billion in synergies over the next two years as a result of the merger.
The reduction in corporate office staff is specifically targeted, as Rogers remains committed to hiring in customer service and technical roles. As a condition for approval, the company has pledged to create 3,000 jobs in Western Canada, with Calgary serving as a secondary headquarters, as per Ottawa’s requirements.
“Since coming together with Shaw, we’ve hired over 2,000 employees and we remain committed to creating thousands of jobs over the next few years as our business continues to grow,” Rogers spokesperson Sarah Schmidt said.
The Rogers-Shaw merger has garnered wide attention since the Competition Bureau has raised concerns about the possibility of the takeover to eliminate the competition in the space.
According to Staffieri’s memo, voluntary buyout offers will be extended to most corporate and line of business employees up to the senior director level. The severance packages will provide four weeks of pay for each year of service, up to a maximum of two years’ salary, in addition to lump-sum amounts. However, employees in customer-facing roles, media production teams, and critical support functions are not eligible for the buyouts.
Rogers did not disclose the expected number of employees who will participate in the program. In an internal memo, Bret Leech, Chief Human Resources Officer, stated that not all applications will be approved to ensure the uninterrupted operation of the business.
Eligible employees interested in the voluntary buyouts have until July 11 to apply, with their last day of work set for July 21, if approved.
In a separate development, Rogers recently announced a new return-to-office program for its corporate employees. Effective August 1, non-frontline staff will be required to work in-office three days a week, while vice-presidents and above will continue following the existing expectation of four office days per week.
Information for this story was found via the Toronto Star and sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.