Telecom Italia could cut more than a thousand jobs through a voluntary early retirement scheme, reportedly as part of efforts to reduce costs by about €1 billion.

A statement on the web site of the FISTel-CISL union indicated that the maximum number of posts to be eliminated between September and 30 November is set at 1,200. The agreement was signed by Telecom Italia as well as unions SLC-CGIL, FISTel-CISL, UILCom-UIL, and UGL Telecomunicazioni.

The union talks apparently began on 16 May 2022, with an emphasis placed on efforts to reskill the workforce over the coming two years in order to meet the changing needs of the operator. Telecom Italia currently employs about 42,500 people in its domestic market.

Reuters reported that the scheme forms only the first round of job reduction plans. The news agency also noted that Telecom Italia CEO Pietro Labriola is seeking about €1 billion in savings between now and 2024. It cited a recent report from Moody’s that calculated staff costs at the operator accounted for around 27 per cent of total 2021 operating spending, or 19 per cent of revenue.

Labriola is currently in the process of implementing a plan to separate the Italian operator into two units, with more to be revealed at its capital market day on 7 July.

According to reports, the CEO recently indicated that the purpose of the plan to split the operator’s fixed network infrastructure from its service operations is to reduce debt and “maximise the value of all assets in the interest of all shareholders”.

Telecom Italia last week signed a preliminary agreement with state lender CDP to combine its fixed assets with those of Open Fiber in order to create a single fibre provider for the nation. Reports suggested the operator was hoping to get a valuation of around €20 billion for its fixed-line network, and that CDP could take a 70 per cent to 77 per cent stake in the combined broadband network operator.