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Nortel Cutting 1,100 Jobs
By Mark Evans | June 27, 2006
Well, this is no surprise: Nortel is slashing 1,100 jobs, including 350 middle managers - a move that will reduce annual operating costs by $100-million by 2007 and $175-million by 2008. You had to know CEO Mike Zafirovski had something up his sleeve when he’s talking about better times ahead by 2008. Do not be surprised if there are even more job cuts are announced as Nortel’s strategic plans are finalized. Update: Nortel is also changing its pension plan structure to save about $100-million a year. The adoption of a defined contribution plan has become pretty standard fare within the technology industry, which begs the question why it took Nortel so long to climb on the bandwagon. One thing disgruntled Nortel employees may find difficult to accept is while their pension benefits are changing, Zafirovski received a US$500,000 "special pension benefit" when he was hired (a guaranteed payment on top of his normal pension benefits).
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Topics: Financials |
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