Italy’s TIM to cut up to 1,200 jobs by early retirement scheme by November -sources

MILAN (Reuters) -Telecom Italia (TIM) has agreed with unions to cut 1,200 jobs in its home market by November through a voluntary early retirement scheme, two sources said on Tuesday, in what would be a first round of its job reduction plans.

While ironing out a strategy centred around a separation of the group’s landline grid from its service businesses, TIM CEO Pietro Labriola is also seeking about 1 billion euros ($1.07 billion) in savings between now and 2024.

TIM, which employs about 42,500 workers in Italy, clinched an agreement on the early retirement scheme in a meeting with unions on Tuesday, the sources said.

TIM declined to comment. The company has been under pressure for years from aggressive price competition on its home turf.

TIM is in talks with state lender CDP to combine its fixed network assets, which would be separated from the rest of the company, with those of state-backed Open Fiber to create a single national high-speed broadband operator.

The new combined network entity would absorb a significant portion of TIM’s domestic staff.

Similarly to other incumbent telecom operators in Europe, debt-laden Telecom Italia is saddled with high staff costs.

Moody’s investors service calculate they accounted for around 27% of total 2021 operating spending, or 19% of revenue, it said in a report issued last week.

($1 = 0.9374 euros)

(Reporting by Elvira PollinaEditing by Keith Weir)