CWC set to cut 500 jobs in initial overhaul

Cable & Wireless Communications, the recently formed cable TV and telephony giant, is about to cut hundreds of managerial jobs as it merges the administrative operations of the four companies which joined to form the new venture.

The company has advertised 80 senior jobs in a first layer of management below the executive board and confirmed yesterday that it had received 300 internal applications, though some had come from staff on lower grades. Once the round of appointments is completed a further three larger management layers will be advertised inside the group. The aim is for each layer of management to organise the selection process for the next layer.

One source said the process was likely to result in a total of 500 job cuts because there were far more applicants than jobs available. CWC was created out of the landmark merger, announced last year, of Cable & Wireless's Mercury subsidiary with three cable operators, Nynex CableComms, Bell Cablemedia and Videotron. CWC shares began trading last month.

The job cuts, which will take place later this year, will almost certainly result in generous redudancy payments. The four companies have offered staff so-called "loyalty bonuses" if they stay in their posts until the process is completed.

Graham Wallace, chief executive, said the selection process had been "totally fair and above board". He added: "This layer of staff will be in place by the end of May and from 1 June we will move on to the next layer. The bulk of the staff are incredibly motivated to make this work. We're doing it in a rigorous and fair way and we've been very open about it."

Mr Wallace also cast doubt on claims that the total job cuts across the group would rise to 2,000 once call centres and network control buildings were merged or closed. The process is expected to take much longer than the initial administrative job cuts.

He said overall staff numbers for the group may not fall much below their current level of 12,500. "This could be a non-issue. We are looking at expanding sales and marketing functions so you can't conclude that overall numbers will fall. The expansion could more than offset the reductions."