NEC eComms Report 2008

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National Executive CouncilReport 2008

Communications Workers Union 4th Biennial Conference Kilkenny 2008

Lyrath Estate Hotel, Kilkenny


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Contents

eCommunicationsChapter Page

1. Introduction and Overview ... ... ... ... ... ... ... ... ... ... 1

2. Pay and LRC Findings ... ... ... ... ... ... ... ... ... ... ... 13

3. Mobiles ... ... ... ... ... ... ... ... ... ... ... ... 17

4. Structural Separation ... ... ... ... ... ... ... ... ... ... ... 29

5. Wholesale Networks ... ... ... ... ... ... ... ... ... ... ... 33

6. Retail ... ... ... ... ... ... ... ... ... ... ... ... ... 65

7. Central Services ... ... ... ... ... ... ... ... ... ... ... 71

8. Partnership ... ... ... ... ... ... ... ... ... ... ... ... 73

9. RBU ... ... ... ... ... ... ... ... ... ... ... ... 77

10. Contractors ... ... ... ... ... ... ... ... ... ... ... ... 83

11. eircom ESOP ... ... ... ... ... ... ... ... ... ... ... ... 85


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Appendices Page

1. eircom Ltd. Staff Side Panel Annual Report 2006 ... ... ... ... ... ... ... 89

2. eircom Ltd. Staff Side Panel Annual Report 2007 ... ... ... ... ... ... ... 99

3. Revised Pay Scales ... ... ... ... ... ... ... ... ... ... ... 107


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eCommunications


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Mission Statement

We will build an organising Union that prospersthrough excellence in service and commitment to recruitment.

We will be innovative in our responses to change by being progressive in our outlook, and determined in our efforts to always act in the best interests

of the Union and its members.

We will, in solidarity with other like minded organisations, campaign for economic and social justice, for freedom of association and respect for human rights and the dignity of

all who suffer from oppression or prejudice, whatever its form.


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I n t r o d u c t i o n

1

IntroductionThere is in my view no industry which has faced theexplosion of change in every facet of its being as hasand is being faced by the Telecommunicationsindustry. Those changes are the cause of constantdisruption to the workers and in Ireland we in the CWUhave the difficult task of defending those workersinterests by managing the impact of the never ending

change agenda on our members. Today the industryhas a myriad of players ranging from some of theworlds biggest telecommunications multinationals tosmall resellers. We have a responsibility and a right toorganise the workers in our sectors and I am delightedto welcome the representatives of the workers in thenew companies to this sectoral conference. We mustview ourselves first as union members with more incommon with workers from the other companies thanwith the managers who see us as an enemy.

While today the majority of our Telecoms members arestill employed with eircom we must make time andspace to learn from the experiences of our new

members. At presentwe are one of the fewUnions who haverecognition in

Vodafone and it willbe very informative tohear how our Branchthere is managing anextremely toughagenda which isusually set at

Vodafonesinternational HQ withlittle or no input fromthe management inIreland. A key challenge for us is dealing with theconstant drive to outsource what they consider non

core activities. Similar issues are facing our newlyrecruited members in O2 and our experiences in

Vodafone allied to the similarities between thecompanies should be of benefit to us in thosediscussions. When one considers that we are now also

Introduction

Steve Fitzpatrick,General Secretary,

Communications WorkersUnion


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1growing our membership in Meteor, we can nowdefinitively state that we are the voice of the workers inthe mobile Communications industry.

The other key area where we must continue toorganise is in the call centre arena or what is known asthe new Sweat Shops. We have had some success inthat area as you will see from the organising report butwith the proliferation of those centres we will have todedicate considerable resources in the coming years ifwe are to make the inroads that those workersdeserve.

The main black spot in the sector is British Telecomwho continues to frustrate our efforts to achieverecognition for our members. In circumstances whereBritish Telecom recognise CWU UK members inNorthern Ireland and where British Telecom claims thatit runs an All Ireland operation, we have no option butto view their actions as discriminatory and one couldbe forgiven if they construed those actions as anti-Irishand a new form of British imperialism.

At Conference 2006 the Union attempted to address asignificant number of issues by passing SupplementaryReport No. 1 which set out to responsibly advance theobjectives set out within the Report. Since then anumber of considerable changes within eircom have

occurred which could not have been envisaged at thattime.

The Company has again been taken into privateownership following a co-offerer bid by the EmployeeShare Ownership Trust and the Australia companyBabcock and Brown with the ESOP increasing itinterest in the business to a 35% stake. As aconsequence the business is now heavily in debt andsubject to extensive scrutiny from its financial backers,particularly in relation to financial performance andstrategic direction. One of the consequences of thesale is that almost all the former senior executives and

quite a few senior managers left the Company.Babcock and Brown appointed their own managementteam to analyse the business and plan a strategicdirection. As a direct consequence no properengagement took place with the Unions and no newbusiness initiatives were taken for a considerableperiod of time. While a strategic vision was given bythe Company to the Telecom Executive in March 2007,any thoughts of proper engagement and dialogue

through partnership quickly disappeared with the standtaken by the Company on the payment of the NationalWage Agreement. Each National Agreement containrestrictive clauses regarding pay claims in excess ofthe terms of those agreement, and therefore it is very


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1difficult to improve the pay and conditions for ourmembers. At the same time the business continues torequire changes to allow it reorganise its operation andrespond to industry demands and intensive

competition. Nobody could have anticipated thedramatic changes that have occurred sinceConference 2006 and how these would impact on howwe do our business and on the priorities we set forourselves at that time.

The regulatory environment remains very challengingwith the constant drive for so called competition atalmost any price to the incumbent. Those regulatory

policies allied to the failure of Government to agree acoherent and cohesive telecommunications strategyfor Ireland has led to the position where capitalinvestment and network development only happenwhere there is at least some prospect of a return to theshareholders. Failure to invest in the network and innew generation technologies with a particularemphasis in fibre, will damage the National economyand will make it extremely difficult for the business toprovide decent customer services.

The long term Company agenda is still unclear, andwhile the issues of new services like VOIP, IPTV, greaterbandwidth, NGN etc. need clearly defined strategies,

the energies of Babcock and Brown seem to be solelyfocused on the separation of the network and retailfunctions with the disposal of key assets such as therecently purchased Meteor Mobile. This critical issue

will need very serious examination by your Unionbefore we make any decisions as to whether wesupport the process or not and our only considerationmust be the long term viability of the jobs, pay andconditions of our members.

Once again the partnership structures have comeunder heavy scrutiny during the past two years with thechange agenda since the LRC agreement being

handled directly through the IR process rather thanpartnership. Under that agreement once more we areobliged to carry out a review of the partnership modeland we will have the opportunity at Conference forBranches to express their views before the review isfinalised in June 2008. Whatever the result of thatprocess, we must develop a way to ensure theinvolvement of our elected Branch representatives.

As the voice of telecommunications workers on thisisland we will continue to face tough agendas on yourbehalf .That we have done so successfully is a tributeto all of you and your predecessors who have given sounselfishly for so long. I look forward at this conference


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1to arriving at conclusions which will assist us as wecontinue our work into the future.

Steve Fitzpatrick,General Secretary,

Communications Workers Union.


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O v e r v i e w

1

For a considerable period of time we have been tryingto establish the future strategic direction of eircom inrelation to key investment decisions. This information isvital in order that we can prepare, you the members, forthe impact that those decisions will have on your pay,conditions and terms of employment. There is nodoubt in anybodys mind that there is an urgent needfor the company to invest in its existing networks aswell as investing in next generation technologies if the

company is to be successful into the future. While weall accept that the companys future success isnecessary to maintain protect and improve our lot, thereis little doubt that those investment decisions willimpact on the day to day work that many of ourmembers carry out. As a result of the attachedpresentations, the Union will shortly begin to engagewith the company on how these new programmes willbe implemented, what the impact will be on our

individual members and on what opportunities thecompanys investment plan presents for the Unionmembership in eircom as a whole. We will also bediscussing with the company how this agenda can bestbe facilitated along with the Unions agenda.

The following information, which is a summary of thevarious presentations, should give each of you a betterfeel for the future direction of the company.

BackgroundOn the 21st of March a joint workshop was held inorder to provide, among other things, an overview ofthe current and future trends within the telecoms

market in Ireland. Specifically, the purpose of theworkshop was to:

Update participants on current issues andchallenges

Act as a forum for information sharing

Increase understanding of strategicchoices

The attendance included the CEO Rex Comb andmembers of his executive and senior managementteams. The CWU participation was lead by the G.S.Steve Fitzpatrick and included the D.G.S., National

Overview


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1Officers, National Co-ordinators and the members ofthe Telecoms Sectoral Executive. Following words ofwelcome and introductions from both leaders, theworkshop commenced. It extended over approximately

five hours and during this period a colossal amount ofinformation was shared and commented on. Thefollowing is a brief summary of the variouspresentations and key messages, which were deliveredon the day by the CEO and his senior executive team.

Introduction and

Presentation 1In beginning the presentations the CEO, Rex Comb,set out the context under the broad headings asfollows:

1. State of the Nation/ Financial Overview2. Key Strategic Programmes.

At the commencement of his input the CEO outlined

some financial commitments and the fundamentalneed to maintain earnings from Fixed Line at severalhundred million per annum for the foreseeablefuture. In parallel with this aim, a capital expenditureprogramme would be rolled out across a broad range

of technologies and services and would, over the nextthree years, cost several hundred million Euro. Thesetwo pivotal corporate objectives would be achieved bya high level strategy consisting of:

Growing revenue whilstcontaining/reducing costs

Targeting Capital expenditure andoptimising corporate finance

The CEO went on to give some details as to how theseaims could be achieved but stressed that the FixedLine costs could not grow by more than the revenuegrowth, and that this would invariably require areduction in costs, both pay and non-pay. Inelaborating on this matter the CEO made the point thatwhile the number of employees had declined by nearly40% since 2001, the overall pay bill had fallen onlymarginally.

In turning to the Broadband Market the CEO confirmedthat the target of 500,000 subscribers, on the eircomnetwork, by December 2007 would be achieved early

and this represented a significant corporate milestone.He added however that whilst it was expected that thenumber of Broadband customers would continue togrow, the average revenue per broadband customerwould decline and this decreasing margin would flow

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1from a combination of regulation and increasinglyaggressive competition. It was further expected thatthe competition from cable would be particularlychallenging in the centres of major population, and that

this potential threat to eircoms revenue base woulddemand innovative solutions.

The CEO then went on to present some detail on theexcellent performance of Meteor and its increasingmarket share as the 3rd Mobile operator. Figures werealso provided as to the cost implications associatedwith the acquisition of the last 3G licence.

In concluding this part of his presentation the CEOstressed that the overriding priority for the Fixed LineBusiness was Customer Service. He reiterated that topquality customer service was not just a nice to havebut was a must have if eircom was to maximise thebenefits from a dynamic and ever changingmarketplace. In this context there was an absoluteimperative to create a customer centric organisation

through a combination of productivity enhancement,infrastructure performance and process effectiveness.This would require new things to be done and oldthings to be done in different ways across broadswathes of the Fixed Line organisation.

Key Strategic Programmes Presentation 2In opening on this section of his presentation the CEOstated that a detailed and probing current stateanalysis of the organisation had been conducted overthe previous nine months. This had resulted in,following consideration by the Board and SeniorManagement conferences, the adoption of a portfolioof Eight Strategic Programmes (See below) whichwould deliver a combination of shorter termimprovement and transformational growth. Each of the

eight programmes would have a sponsor from theExecutive Team who would have overall responsibilityto ensure delivery of the programme benefits. Therealisation of the expected benefits would accrue in theshort, medium and longer term and overall co-ordination and governance of the various programmeswould reside within a Strategic Programme Office.

Key Strategic Programmes

Mobilise the Company to achieve our goals.

Deliver on our customer service targets.

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1 Maximise efficiency and cost reduction.

Deliver improvement through people.

Drive Broadband and Next Generationportfolio growth.

Design and build our Next Generationnetworks.

Design and build our Next Generationbusiness and system architecture.

Drive growth in our mobile business.

In concluding on this section the CEO reiterated thecriticality of the eight programmes and their potential

to transform the organisation, thus securing eircomscompetitiveness and prosperity into the future.

Network Operations Presentation 3

Strategic Challenges Facing NetworkOperationsThe financial year just ended has been anextremely challenging one for NetworkOperations:

Operating volumes: -Operating volumes have increased significantly fromthe previous year driven mainly by market demand forbroadband service, PSTN service arising from the

continuing strong housing growth throughout thecountry. This strong demand has arisen from both theRetail market and the Wholesale market. In addition,volumes of faults have been significantly higher thanthe previous year driven by a number of severe stormsthroughout the year. Our network, particularly ouroverhead network is vulnerable to severe weatherconditions.

Service Levels:-While our service performance for service delivery hasimproved throughout the year there are a number ofkey areas where our service did not meet target. This ismainly on repair for both PSTN and DSL services andhas been driven by the volumes outlined above.

In the short and medium term future there are a

number of significant challenges facing us:

Network PerformanceIt will be necessary to invest in the network in order tomaintain network performance and make it more

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1resilient to severe weather conditions. This is donethrough network renewal investment and a number ofkey preventative maintenance programmes. A keychallenge for us is to balance the need for investment

in renewal of the network with the need to build nextgeneration networks.

Service LevelsBoth the Retail and Wholesale markets have set outthe required service levels in their markets which posesignificant challenges to Network Operations andrequire improvement in both our service delivery andrepair performance.

Productivity ImprovementIn order to offset the impact of inflation on ouroperating costs it is critically important that we improveproductivity in order to meet the demands of the

market and provide a satisfactory service level. Thiswill require process improvements to our centre/fieldoperating model together with improved productivityand output from our technicians in the field.

The Network Operations management team arecurrently finalising an integrated strategic plan toaddress all of the above competing demands forinvestment, service improvement and cost reduction.

An integrated set of investment decisions are being finalisedto support service improvements

INVESTMENT AREA WHAT IT DELIVERS NET OPS CHALLENGESNGN Core

NGN Access

NGN IT

Access Renewal

Wireless/Fixed Cellular

More flexible bandwidth cheaper

Ability to compete with cable

More competitive propositions

Improved stability in the access

Alternative to long line copper

INVESTMENT

Alignment between accessand core

Resourcing Programme Management Skill Sets

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1Summary and Key Issues: Improvements in customer service are

imperative to protect our revenues and thebusiness.

The various market channels, includingwholesale, have set out their marketrequirements for service performance.

We have significant gaps in performanceagainst these.

To achieve these levels of performance weneed to:

Put service improvement plans at the coreof all our decision-making.

Implement a more robust centre/fieldmodel, with the centres in greater control ofthe work.

Address the productivityvariances across teams insimilar networks, through arevised management modeland improved individualperformances.

Next GenerationTechnologies Presentation 4The companys recent decision to invest in nextgeneration technology is one, which has received abroad welcome from all stakeholders. The decision isdirectly linked to two of the eight strategic programmesthat management has designed as key elements in thecompany strategy and will impact on several others.The deployment of next generation technology acrossthe network will not only enable the business to exploit

technological development but allows the developmentof new product ranges and facilitates cost reduction.However investment will not be confined to newtechnology alone which will deliver capability andcapacity, resources are also committed to improvingcost & quality as outlined in the figure below:

INVESTMENT PROGRAMMECapacity

Capability Cost & Quality

InfrastructurePerformanceImprovement

NGN Core NGN Access NGIT Mobile Billing IPTV 3G

Access Growth Core Svcs Growth PSTN Growth Mobile RAN Coverage DSL Coverage

Network Renewal Pole Replacement Test Automation & Eqpt Vehicles

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1The deployment of next generation technology inthe network is driven mainly by:

Product demand for greater bandwidth.

Cost effective connectivity to meet majorcustomer migration to IP.

Continued housing stock increase andbroadband demand.

Competitive threat from cable.

Demand from OAOs.

Allied to the planned network upgrade is the equallyimportant plan to design and build next businessgeneration and system architecture to enable the newtechnology to be fully exploited to maximise the returnon investment. The current IT architecture serves alegacy business model and has developed over time inan ad hoc manner to meet new products andprocesses. It is in some respects inflexible andcumbersome. To address this the company mustdeploy new business systems that support:

New IP based products. Broadband customers and their PSTN

services.

All new products.

In either case, network or support architecture, it is notsimply a matter of rolling out the new and switching offthe old. For a considerable period both nextgeneration and legacy technology & systems willcontinue to stand side by side in the network as acontrolled migration is managed.

Retail Presentation 5The Managing Director outlined the overall currentposition regarding retail. He spoke of the challenge ofmaintaining earnings in the fixed line business, which

would require: Aggressively defending traditional

revenues.

Growing new wave revenues.

Significantly restructuring and controllingour retail cost base.

He said that maintaining high levels of winback in an

intensely competitive market is becoming increasinglydifficult even before the relaunch of the cable threatscheduled from another major player (UPC) for this

Autumn. He added that more focus would be requiredto reduce churn and this represented a key imperative

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1coupled with the need to grow New Wave revenue,specifically broadband and associated online and IPTVservices.

In concluding his remarks the Managing Director

emphasised how critical it was to ensure that pay andnon pay costs are restructured in line with revenueperformance, to guarantee earnings are retained at therequired levels as outlined by the CEO.

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R C F i n d i n g s

2

PayWe have been used to lodging claims at JointConciliation Council in order that our members wouldreceive the percentage increases recommended underNational Wage Agreements. The first phase of theagreement Towards 2016 was paid in the normal wayvia discussions at Joint Conciliation Council. We hadlodged a claim well in advance for the 2% payment due

on the 1st May 2007 under Towards 2016 Agreement.It was obvious that some posturing within the Companywas taking place due to the lack of decision takingpertaining to the claim. A number of Joint ConciliationCouncil meetings were held where the Companyindicated that they were still considering the claim.

The National Executive decided at its meeting in May(3rd 2007) after being briefed that the Company were

still considering their position on the claim to sanctionthe holding of a ballot of the members for industrialaction, if confirmation of payment was not received bythe 22nd May 2007. Notwithstanding the delay it cameas a major surprise when the Company by way of

senior management issued a Memorandum ofUnderstanding document at the end of May to theCWU Officials. A delegation met senior managementand told them that Union the could not and would notbe signing the said document. Notwithstanding ourstated position the Company reiterated that they wouldnot pay the outstanding phase of 2% due since the 1stMay 2007, unless the Union was willing to sign theMemorandum of Understanding.

The National Executive decided on the 12th June 2007to ballot all of its members in pursuit of full and timelypayments of outstanding amounts due to them underTowards 2016. The other three Unions who make upthe Unions staff side in eircom informed us that theytoo were balloting their members for the same reason.The result of the ballot for industrial action in eircomwas:

Total ballot polled 5200Total number of votes cast 4501Total number valid votes in favour of proposal 4351

Votes against the proposal 146Spoiled votes 4

Pay & LRC Findings

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2This ballot of 84% of membership, voted 96.7% infavour of supporting the National Executive decision totake action in pursuit of our justifiable claim. At the timethe Union thanked all the CWU activists for the sterlingwork invested in delivering such an overwhelming result.

The Union met the Company on the 11th July 2007,where the Company tabled a similar document to thefirst one when again the Union considered that it wasway beyond the concept of normal ongoing change asspecified in Towards 2016 Agreement. The Unionformally served 7 days notice of industrial action ineircom on the 12th July 2007 as provided for under the1990 Industrial Relations Act.

The Labour Relations Commission requested bothsides to attend the Commission for talks on the dispute.The talks were facilitated by Kieran Mulvey, ChiefExecutive and Kevin Foley, Director of Conciliation.

After three days of discussion the Labour RelationsCommission issued settlement terms on Wednesday18th July 2007. The Telecom Sectoral Executive meton Thursday 19th July and formally accepted the terms.

The settlement terms commit the Union with theCompany to agree in partnership the steps necessaryto ensure the long term survival and profitability of theCompany. From a Union point of view this was not an

issue as it was what we had been doing since the initialprivatisation.

Proposal of the Labour

Relations CommissionIt is clear to the Labour Relations Commission that the

parties face significant challenges in terms of dealingwith the business issues facing the Company. It is alsoclear to the Commission that both parties arecommitted to constructive and realistic jointengagement utilising partnership and other internal

structures to find agreement in relation to all issues in

all areas of the Business.The Commission is also clear that an industrial dispute

in relation to the terms of Towards 2016 was notenvisaged by the parties to that agreement and is in no

partys interest in eircom at this time.

Taking all of the above into account the Commission makes the following proposal to the parties:

Proposal The 2% phase of Towards 2016 be paid by the

Company as soon as practicable with effect fromthe due date.

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2 The parties commit to all the provisions of the

Private Sector Pay Agreement contained inTowards 2016.

In this context also and in a spirit of partnership

the parties commit to uninterrupted operation of the Partnership structures in eircom.

The parties confirm to the commitments already agreed and articulated in JCC Report No. 601.

The parties commit fully to immediate andconstructive engagement at JCC, PSG and other

appropriate business unit a on the Companyschange programmes and initiatives with a view to

prompt finalisation of agreement. The Union sidewill respond ideally within 20 working days of each proposal being tabled.

The parties agree to immediately carry out a review to improve the effectiveness of internalPartnership structures, processes and

accountabilities with external support or the assistance of the NCPP as may be agreed. This review should be completed by 30th September 2007.

The parties agree that in the context of thecompanys change programmes and initiatives,

priority agreement is required, ideally by 31st August 2007, on the precise details of operationof the Resource Business or other similar unit for the eircom group as may be agreed, as anessential tool to re-assign, re-train and upskilldisplaced staff in line with the principles agreed

as part of the Blue Book.

The parties agree that in the context of eachchange programme, prompt engagement is

required to develop jointly solutions to the significant staff impact issues which flow fromthem, including those arising from the currentVR/VL scheme. The Parties commit to utilising all

necessary internal procedures in order to resolveto finality any issue of disagreement which mightemerge. The parties agree also to utilise the

services of the LRC, in the case of genuinely exceptional matters and circumstances if

necessary where disagreement persists followingthe exhaustion of all internal procedures.

Towards 2016The next phase of Towards 2016 of 2.5% was due onthe 1st February 2008. This claim was lodged on the17th October 2007. Agreement was reached on the

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R C F i n d i n g s

2payment of same on the 15th February 2008 at JointConciliation Council. The points agreed were :

The Parties reaffirmed their commitment to theterms of JCC Report No 604 of the 23rd July

2007, which incorporates the terms of theirsettlement reached in accordance with theLabour Relations Commission proposal of the18th July 2007.

The Parties have determined a new completiondate of the 30th June 2008 in respect of a reviewto improve effectiveness of internal partnershipstructured processes and accountabilities.

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3

VodafoneIntroductionMr Charles Butterworth was appointed Chief ExecutiveOfficer of Vodafone, Ireland in late 2006. At meetingswith staff and representatives, Mr Butterworth set outhis vision for a Vodafone Ireland under a project calledDestination 2010. Mobile penetration has reached120% in Ireland and despite this phenomenal growth inthe market the average revenue per user hasdecreased. Under Destination 2010 Vodafone intendto become a communications provider for mobile, fixedline and broadband the objective of becoming theground breaking leader in the Telecommunicationsmarket. The strategy is underpinned by the decisionby Vodafone Ireland to purchase Perlico, a Companywhich is in the fixed line business.

Vodafone InternationalIn Countries where Vodafone employees are members ofTrade Unions, Vodafone have good working relationshipswith the Trade Unions. The same cannot be said of

countries where Trade Unions are attempting to recruitVodafone employees into Trade Unions. A case in pointis the situation in South Africa where Vodacom havedismissed staff for joining the Communications WorkersUnion. We have given support to our colleagues inSouth Africa through a campaign organised by UNI. Aspart of this campaign the attended the Annual GeneralMeeting of Vodafone shareholders in London andhighlighted the plight the CWU in South Africa. The CEO

for the region met a delegation from UNI and undertookto open up a dialogue with the CWU in South Africa witha view to resolving their issues.

Subsistence Increases andArrearsThe issue as to whether eircom or Vodafone were liablefor the payment of arrears of subsistence from April

2000 to May 2001 when the de-merger took place wasthe subject of a Labour Court hearing. The LabourCourt recommended that further discussions shouldtake place on this matter at the Labour RelationsCommission and following those discussions the

Mobile

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3following recommendation was issued by the LRC.

(i) The Company should pay the outstandingarrears.

(ii) The parties should negotiate an increase in the

current rates of subsistence having regard for theincreases in the Consumer Price Index.

Both the CWU and the Company accepted therecommendations and following a meeting with theCompany the implementation of the recommendationswere agreed.

The CWU welcomed the successful outcome of thosediscussions and in doing so acknowledged the

assistance of the LRC in bringing this matter toconclusion.

With regard to (ii) discussions commenced with Vodafone and agreement was reached that the level ofthe increase, to apply with effect from 1st March 2007would be 4.8%.

The revised rates are:

Outsourcing of AD & MIn 2007 Vodafone decided to outsource its European

Application Development and Maintenance operationsin Europe to IBM and EDS, IBM was selected as the

outsourcing partner for Vodafone Ireland. Severalmeetings took place between CWU, Impact andManagement teams from Vodafone and IBM. Staffwho transferred to IBM did so on a voluntary basis.The following was agreed between the parties and arecontained in a local service agreement between

Vodafone Ireland and IBM.

Representation Terms & Conditions of Transfer

Job Security Pension Arrangements Retention Plan Fixed Term Contracts PRSI payments Work Locations Benefits Potential Offshoring

Project EVOThe Vodafone Group announced in late 2006 details ofProject EVO. This project is a Global businesstransformation programme to implement a singleintegrated operating model supporting a single ERP

Day Allowance Low 13.29

Day Allowance High 32.57

Night Allowance Normal 99.10

Night Allowance Reduced 84.90

Night Allowance Detention 49.57

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3model across Finance, Supply Chain and HR. The 17majority owned Vodafone OpCos including VodafoneIreland will be impacted by this development. Thetimescale for the completed project is 2010.Vodafones

Executive Committee have taken a decision to locate a Vodafone Operations Centre in Hungary (VOCH) tohandle this part of the business. The VOCH will operateas a shared service centre and will deliver newcommon processes to all Vodafone OpCos and this willrelease OpCo Finance/SCM/HR teams to focus onvalue added activities while the VOCH will focus onprocess improvement and control and is due to be

operational from September 2008. A VodafoneProcurement Company (VPC) has also been set up inLuxemburg and will be operational by April 2008.

Vodafone Ireland was due to go live sometime in mid2009 but following a review of the timescales and thefact that India is to be integrated into Evo in a uniquestream. This would allow Vodafone to put in processcontrols to support Indias rapid growth and to useEvos Core Business Model to facilitate Indiasintegration into Vodafone, this has now resulted in arevised implementation programme with Ireland goinglive along with Egypt and Turkey in April 2010.

Global Technology andTerminals FunctionsGlobal organisational changes have recently beenannounced regarding Global Technology and Terminals

functions.

From 1 April 2008 each European OpCos Technologyand Terminals functions will report to the Global GT.This new structure will ensure a consistency ofstrategies and architectures and will achieve anoptimisation of costs across OpCos.

The proposed operating model for these functions willbe based on a Hub & Spoke structure, which will

ensure clear accountability & aligned objectives acrossEurope. To facilitate this evolution, European CTOs willreport into the Global Technology organisation. In thecase of Vodafone Ireland the CTO will report into theUK which will be a hub. There will be no other changesat this stage to the reporting structure. All HR functionswill continue to be managed by local OpCo HumanResources Departments.

At a meeting with the Company the Union raised anumber of questions regarding governance andindividual OpCo responsibilities due to the change.

It was stated that OpCo CTOs will continue to beresponsible for all currently delivered OpCo services

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3and will retain responsibility for local quality,deployment and budgets. However, the local CTO willshare within the Global function design responsibilityand implementation for the European NetworkEvolution program. The local budgets will be managed

by individual markets and results will be maintained inthe local OpCos accounts.

Both functions will also preserve a local reportingrelationship to the OpCos and will be integrated in thelocal governance bodies to ensure alignment with localoperational and commercial priorities.

Merging of Admin and AgentSupportThe Company presented proposals to Partnership tomerge the Back Office support teams both AgentSupport and Admin. The reasons for this includedgaining some cost efficiencies within the Back Officearea, to provide a greater span of work and increasemulti-skilling and to achieve a more equitable sharingof the workload across the existing teams. The

Company believe that when multi-skilling is achievedthis will lead to further efficiencies.

The merging will be phased in as follows:-

Phase 1 Merge Postpay Admin & Agent

Support with Prepay Admin to follow at a laterdate.

Phase 2 As further efficiencies are rolled out decrease the team size (as per previous

proposals redeployment to front line teamsmanaged via:

Churn Voluntary process Attendance Performance

Transfer of Credit Management

Resourcing to VodafonePartnership was advised in November that following aninternal operations review Vodafone had decided tomanage the Credit Management function internally withdirectly employed Vodafone employees. Up to thenemployees in the Credit Management functionconsisted of a mix between Vodafone and RigneyDolphin employees. It was agreed that to implementthis, the transfer must be treated as a Transfer of

Undertaking for the purposes of the EuropeanCommunities (Protection of Employees on Transfer ofUndertakings) Regulations 2003. Under the regulationsall the Rigney Dolphin employees engaged on CreditManagement work for Vodafone Ireland were offered


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3Other Items Discussed at theCustomer Ops Partnership O/T Payment in Dundalk Logged Hours

Proposed Rota Changes escalation process Data Team Expansion Managing Prepaid Campaign Intervention Vault Review Impact of Vodafones purchase of Perlico on

Customer Ops

Field Force ReorganisationIn the early summer a presentation was given toPartnership regarding a proposed reorganisation of theField Force. The Field Force are responsible for fieldmaintenance of 2G, 3G switch & base stationinfrastructure plus supporting technologies. They alsocarry out associated activities including customersupport, project support (access and testing), plusbuilding facility management. The present structure hasbeen in place since 1996. The main body of work carried

out by the team is seen as a vital component of theoverall technology Operations E2E Service Managementfunction. However, operational practices within theteam were not seen as optimal and a requirement wasidentified for a reorganisation of the team.

Under this organisational review, it was proposed toimplement a major restructuring of the Field Force.These Changes included 1) introduction of three newteams, each team lead by a Team Co-ordinator. 2) Theintroduction of an integrated workflow managementsystem giving real-time fault management and 3) Theremoval of non-core activities from the teamsresponsibilities.

Following consideration by Partnership thefollowing was agreed:-

1. New Team StructureThe new team structure will consist of 3 teams, witheach team lead by a Team Co-ordinator. The 3 teamswill be North, South and Dublin. The Team co-ordinatorwill be responsible for the day to day organisation ofeach team and terms and conditions have been agreedfor these positions.

2. Integrated Workflow ManagementRemedy will be redeveloped to improve the current

Trouble Ticket scheme and to provide for a remotehandheld solution. This will facilitate better planed,scheduled working and where possible automate,optimise, dispatch of TTs. It will also build on currentanalysis of work activity in the field force.

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33. Core Field Force ResponsibilitiesThe Field Force team is presently engaged in manyactivities for both Vodafone operations and otherdepartments within Vodafone Ireland. The Field Force

team are used by internal teams as an extension totheir teams. Work requests are passed to Field Forcewith out any consideration of its impact on operationalmaintenance work. These jobs are mainly unplannedfrom an operational point of view. The responsibility ofthis work is also passed on to the Field Force. Cost isnever discussed as overtime/work time is funded byOperations. Access to sites is a major stumblingblock. Landlords are becoming increasingly stricter

with who has access to their premises.

A work shop with team members will be required tofully identify what is core and what is not core work.Once complete the mechanics of how work is assignedto FF by other departments and how it is financed canbe finalised. This workshop should be completed bythe 3 team coordinators and line manager.

Other Items Discussed at NetPartnership Pay and Reward Field Area. SOC Training.

FLS Staffing. Pulse Survey (Technology). CSS Workload Balance. DT Team Resourcing.

European EmployeeConsultative Council MeetingJuly 2007Mick Farrell represents the Union on the VodafoneEuropean Employee Consultative Council.

Presentations on the following items werepresented to the meeting:

VF Performance, Strategy and Key Initiatives. AD & M. EVO. EMAPA. People Update.

Vodafones Key Strategy Revenue stimulation and cost reduction in

Europe. Develop new streams through Mobile Plus. Deliver strong growth in emerging markets. Align capital structure and shareholder returns

policy to strategy.

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3Revenue stimulation will beachieved through driving fixedto mobile substitution through Customer Value Focus. Promotions (Voice and SMS). Roaming.

Outgoing voice usage increased 22% in FY 06/07 inEurope.

Strategy for cost reduction inEurope AD& M outsourcing, IBM and EDS were selected

as outsource partners, this is progressing acrossGroup.

Network Supply Chain annual savings forecaston network spend within two years.

EITO European Data Centre Consolidation. *RAN Sharing MOU signed by both Spain and UK. EVO in early stages of multi year programme.

Hungary selected as shared service centre. Vodafone Procurement Company.*Network Sharing initiatives are locally driven. Situations need to beexamined locally to see if there is clear advantage in sharing, localOpCos do not want to give away any competitive advantage with RANsharing.

In the UK VF and Orange have more or less the sameNetwork and market share and have the samebusiness objectives so a long term stable partnershipcan be achieved.

The Groups long-termambitions for Europe Lead in all European Markets. Be the preferred and strongest Mobile Internet

data provider. Have the best perceived brand and service in

Europe. Maintain superior profitability vs competitors.

Have the best working environment andmanagement.

AD & M Key MilestonesJanuary 06 IOC established project to explore alternateoutsourcing arrangements for AD & M. Based on afeasibility study an outsource model was pursued.

September 06 EDS and IBM selected as AD & M

partners. November 06 MSA signed. December 06 LSA for UK, Spain and Czech

Republic signed. December 06 June 07 other OpCos follow.

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3Decision on ApplicationOperations

A decision was taken to have AD & M in a stableenvironment before any further decisions were taken

regarding the future of Application Operations. Vodafones options for AO are:

Leave AO as it is and develop some efficienciesthrough internal rationalisation.

Centralise AO within VF, Global Operations orEITO.

Outsource it to Partners.

This decision on AO will be taken in the new-year.

EVOProject EVO is the business transformation programmeto implement a single integrated operating modelacross SCM, HR and Finance.

This programme impacts on 17 majority ownedOpCos.

It will provide:

A single source of data. Standard common process. A universal language for products and

terminology.

Identification of the best commercial resourcesacross global supply chain.

Consistent employee experience.

A Shared Service Centre has been selected for

Budapest which will enable VF to operate globaltransactions from a central location. The SSC releasesSCM, HR and finance teams to focus on value addedactivities while the SSC focuses on processimprovement and control.

As part of the implementation of EVO a VodafoneProcurement Company (VPC) is to be set up. InJanuary the Group Executive Committee approved theimplementation of a VPC which will be based inLuxembourg and will be a stand alone company thatwill procure goods and services on behalf of

Vodafones OpCos.

It is envisaged that the VPC when fully up and runningwill have approximately 130 employees based inLuxembourg (most migrating from global category

teams).The VPC will commence with a team of 15 people inOctober and trading will commence for a small numberof categories in April 2008.

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3People UpdateEmployee Engagement Vodafones aim is to have employee engagement

levels in the top quartile of companies in each

market. Identified key touchpoints to address this. VF are focusing on those touchpoints that have

biggest influence on people engagement. These touchpoints are:

Organisation and Change. Communications and Involvement. Learning and development.

Resourcing. Reward and Recognition. Health Safety and wellbeing.

MeteorThe Union supported eircoms decision to purchaseMeteor. We regarded the purchase as a good strategicmove which enabled eircom to re-enter the mobilemarket. We also saw it as an opportunity for the Unionto recruit new members in Meteor. Previous attemptsat recruitment had been stymied by localManagements anti-Union attitude.

The General Officers met Senior Management fromMeteor and eircom on a number of occasions with aview to negotiating a framework relationshipagreement between Meteor and the Union. Despiteassurances from Senior Management in eircom thatthey were supportive of the Union, it became obviousthe anti-Union mentality of Meteor Management wasprevailing. In view of the lack of progress the NationalExecutive Council decided in June 2007 to withdrawco-operation from Project Nova. In July 2007 it wasdecided to withdraw from Partnership. Subsequently ameeting took place between the General Secretary,Deputy General Secretary, Rex Comb, CEO, eircom

and Robert Haulbrook, CEO, Meteor and the CEOswere left under no illusion about the Unionsdetermination to recruit Meteor staff into the Union.The content of a document which had come into theUnions possession was highlighted at the meeting.The author of the document had set out what in theiropinion were the strengths, weaknesses, opportunitiesand threats in Meteor and the following appearedunder the heading Threats:

Involvement of some members in Trade Union membership leading to more difficult management situations.

Both CEOs denied all knowledge of the document. We

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3eventually reached agreement on a relationshipframework agreement between Meteor and the Unionand the following joint communication was issued toMeteor staff with the agreement:

Meteor Mobile CommunicationsAnd

The Communications Workers Union

A Joint Communicationto Meteor Staff

Meteor has always considered the wellbeing of

employees to be a fundamental value as the Companycontinues to develop and grow the highest priority willcontinue to be placed on employee welfare. As animportant part of this process Meteor and theCommunications Workers Union (CWU) have begunworking closely together to build a partnership for thefuture.

We are pleased to announce that the CWU is nowformally recognised by Meteor Mobile Communicationsas the sole representative body for staff members inthe Company and that Meteor acknowledges the rightof staff to join the CWU, should they so wish.

The Communications Workers Union recognises thebusiness needs of Meteor and is committed to helpingthe Company grow and prosper for the benefit of allemployees.

The CWU represents 16,000 staff in Irelandscommunications sector, and it currently has almost8,000 members in eircom.

The Union acts for its members collectively viaindustrial relations processes and on a personal basisby representing individuals. The CWU also offers freelegal advice in addition to providing training anddevelopment.

Meteor and the CWU are currently agreeing accessarrangements so that the Union can meet all interestedMeteor staff in the near future to explain the benefits ofmembership.

In the meantime, should any Meteor staff member wishto get further information about the CWU, call (01) 8663000 or log on to www.cwu.ie.

Signed:

Robert HaulbrookChief Executive OfficerMeteor Mobile Communications

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3Terry DelanyDeputy General SecretaryCommunications Workers Union.

Date: 11th October 2006

The story of Meteor would not be complete withoutmention of the local CWU representative, Martin Quinn.Martin has stuck by the Union in very difficult timesand at great cost to himself and he is to becommended for his loyalty to the Union. Thankfully thesituation at Meteor has improved and the Union has agood working relationship with Management and alarge percentage of Meteor staff have joined the Union.

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S t r u c t u r a l S e p a r a t i o n

4

It would not be possible to deal with all aspects of

Babcock & Browns proposals for Structural Separationin one section of the report, and what follows is asummary of events to-date.

In September 2007 Pierre Danon, Chairman of eircom,Rex Comb, CEO and Senior Management requested ameeting with the General Officers of the Union. Thepurpose of which was to explain Babcock and Brownsproposals for the Structural Separation of eircom.

Under the proposal eircom will be split into twoseparate companies, ServCo which will comprise ofthe retail sections of the Company and NetCo whichwill comprise of network operations. The rationale putforward by Mr Danon for this proposal was that in late2007 it was expected that Vivianne Redding, EuropeanCommissioner, would issue a directive which wouldrequire Regulators and telecommunications companiesto bring forward proposals for Structural Separationand in these circumstances it would be advantageousfor eircom to commence the process of StructuralSeparation in consultation with ComReg and the

Government. The advantages of Structural Separation

for the aforementioned is that it would eliminate thedifficulties on Local Loop Unbundling, as competitorscould use eircoms network on an agreed price and thisin turn would lead to an explosion of competition.ServCo would be sold and this would generatesignificant cash return for Babcock and Brown.NETCO would be classified as a utility company andthrough a re rating, shareholders would receive a betterreturn on their investments.

Babcock and Brown engaged CRA Associates, aconsultancy group who issued a report recommendingStructural Separation. In November 2007Commissioner Redding did issue a report on theTelecommunications Industry in Europe, however thereis no mention of Structural Separation. FurthermoreCompetition Commissioner Neelie Kroes and IndustryCommissioner Gunter Verheugen issued a documentstating Separation is not only superfluous but alsodamaging, it wont stop former monopolies fromdiscriminating against competitors who need to usetheir networks and damaging because the measure

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4could deter investment in ultra fast broadbandnetworks. The proposal for Structural Separation didnot find favour either with Alto the lobby group forother Telecommunications providers. The Chairman of

Alto, Mr Liam OHalloran urged ComReg and theGovernment to reject any eircom offer to sell its retailarm and its Meteor Mobile Phone Business stating thatprices to businesses and consumers would risefurther while service standards and broadbandavailability would decline.

The union engaged Mr Kevin Morgan IndependentConsultant. Mr Morgan lives in Australia and has atrade union and telecommunications background. Hehas issued a very detailed report in which he is highlycritical of Babcock and Browns proposals for theStructural Separation of eircom. He also highlightedthe fact that CRA do not have a consistent approach tothe issue of Structural Separation and a report issuedby CRA in Australia on the issue of StructuralSeparation states the following:

Structural Separation in Telecommunications raisesfar greater complexities and difficulties than thoseencountered in gas, electricity, rail, ports and airports.These complexities and difficulties arise from thetechnically dynamic nature of the telecommunications

industry, which make i t difficult to determine theappropriate functional boundaries and from thesubstantial uncertainty that characterises demand andsupply conditions going forward. In essence securingthe gains from the continued rapid development ofTelecommunications technology requires an integratedoperation that spans networks and services, fixed andmobile, conduit and content. Placing artificial barriersto such integrated operations is likely to be deeplycounter productive. Not only will this cause costs torise but even more importantly it is likely to mean thatconsumers do not get the full benefit of new productsand services.

In summary Only the US market has seen structural

separation with the 1985 AT&T break up intoeight companies. That break up damaged theUS telecommunications industry especially in thecellular/wireless market

It has taken two decades for the US industry toreassemble the former Bell monopoly and reestablish the USAs standing as a leader in thetelecommunications industry

BT agreed to functional separation but there were

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4trade offs including the removal of price capregulation

No regulator has sought to impose structuralseparation and the weight of opinion amongstindustry analysts, consultants and academics isthat the costs of structural separation outweighany potential gain

Many commentators consider that changingtechnology and the move from copper based,circuit switched networks to fibre transmissionand IP platforms makes structural separationredundant as a regulatory tool

Loss of cash flow for investment

Greater regulatory oversight

Pressures on staff with truncated career pathsand doubts about security of employment andpension rights.

Structural Separation would lead to yet anotherdisruptive ownership change and restructuringwhen the company is undercapitalized andshould be focusing on broadband and NGNrollout

It would strip out the recently acquired mobilenetwork which is an integral part of anyconvergence strategy and which will be meshed

in with the fixed network in an IP environment.

Heavily impacts on consumers with increasedprices and severe impacts on quality of serviceespecially in the unbundling process.

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W h o l e s a l e N e t w o r k s

Review of Access NetworkOperationsSince our last Biennial Conference the Union hasnegotiated and facilitated the implementation of a widerange of change measures. This would not have beenpossible but for the commitment and co-operation ofthe SEC, Partnership Co-ordinators, BranchSecretaries and a wide cross-section of Branchrepresentatives. Therefore thanks is due for the effortput in to the finalisation of the various agreements,some of which were both complex and staff sensitive.Most of the issues, which arose, were dealt with in aneffective manner, however communications aroundsome of the possible impacts must be improvedparticularly were redeployment issues arise. In thewider context the Partnership process itself has beenunder strain and is subject to ongoing review. (The

details of the new Partnership arrangements areoutlined further in this Report.)

The Access Network and the various functions thatsupport it represent a primary and vital asset.

Consequently any change initiatives need to make

good business sense, be flagged at an early stage andindicate any staff impact. These are just a few of thecriteria against which that all proposed changes haveto be measured.

The following is a summary of some of the majorchange measures concluded over the past two years.

Project NovoProject NOVO, which involved a new platform forWorks Management and replacement of theToughbook, had been on the agenda for aconsiderable time. It was proposed originally to theONPG and the Sectoral Executive in early 2005. Due toa variety of reasons, some technical, the projectexperienced significant delays.

Following the Unions successful campaign on theMETEOR recognition issue in mid 2006, the Executiveagreed to reengage with NOVO via the WorksManagement Focus Group. Consequently a projectNOVO Field Trial was agreed and completed in early

Wholesale Networks

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2007. The Trial involved 8/9 teams, both S.A. and S.D.and feedback from the technicians involved was quitepositive, particularly the speed at which jobs weredownloaded on to the BlackBerrys. An extensiverange of supports, including training were allocated

to NOVO to ensure user familiarity and confidence.These supports, which according to the feedbackworked extremely well, were in place for the period ofthe Trial and continued for the duration of the overallrollout in Spring 2007.

Service Order IncentiveSchemeSservice Order Incentive Scheme was an issue, whichtook up a considerable amount of time in 2006. Part ofthe difficulty was the opposing positions in principletaken by different branches and the requirement for theSEC to try and reconcile these positions. In October2006 a circular was issued from Head Office whichstated, inter alia, While it is fair to say that not allbranches support the present scheme as theirpreference is for overtime or because they view it asdivisive, it was still the belief of the NEC that there isenough merit to the scheme to continue with it. Thevoluntary nature of the scheme means that nobody is

forced to operate it while considerable additionalearnings are being realised by members who supportthe scheme in many areas in the country.

As the Service Order reduced in 2007 the scheme waswound down and no proposals have been advanced todiscuss an alternative.

PQO Right Sizing At the end of 2006 a comprehensive report was issuedby the N.E.P.G. and agreed by the SEC. An extractfrom the report stated that:

The purpose of this report is to right size the PQOorganisation in line with current contractor spend and

activity. The company are committed to introducing a new contractor self-auditing model for the start of the next financial year (April 07). The PQO role will change accordingly and will be reviewed in partnership to meetthe demands of that model. This new model will be

agreed in the intervening period and any opportunitieswithin that new organisation will be open to those 76

currently in the PQO organisation.While most elements of this report were implementedsome issues, which were discussed but not formallyagreed, remain, most notably the understanding that

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was reached around the issue of PQO regrading. Thismatter has not yet been finalised.

Cable Pressurisation and

MaintenanceIn the Autumn of 2006 the Service AssurancePartnership Group brought forward an agreementwhich provided for a new method of operation withinthe Cable Pressurisation area.

SAPG AgreementNew method of operation for cable pressurisation &

maintenance.

The SAPG met and considered a proposal on a newmethod of operation for cable pressurisation andmaintenance as part of discussions on the new FMOfor the SA field organisation. Following thesediscussions the SAPG has agreed to:

1. Centralised Operating Model

The centralisation, control and live monitoring of thepressurisation system and alarms will be carried out inthe National Fault Management Centre (NFMC) inLimerick which will be responsible for:

Centralised monitoring of alarms andperformance of alarm diagnostics.

Network management including changemanagement procedures for NE & Contractors.

Network administration & reporting.

Existing resources in the NFMC will be trained toperform these roles.

Pressurisation jobs and routine maintenance will bedispatched to the field teams by the Service AssuranceWork Management Centre (WMC) via the Advantexwork management system. Service Assurance Teamswill carry out first level fault condition assessment andclearance, based on priorities set by NFMC.

The National Pressurisation Team will provide 2ndLevel expert support on hardware problems andleak/fault localisation and repair.

Fault condition assessment and clearance, basedon priorities set by NFMC.

2nd Level expert support on hardware problemsand leak/fault localisation.

Joint repair and cable changeovers as required Carry out the compressor machine and hardware

maintenance tasks and routines. Transducer programming and distribution. This team will work into the national Preventative

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Maintenance organisation. IT systems administration e.g. user access etc.

will migrate to Systems Administration inBusiness Planning and Support.

2. Network Blackspot Task ForceIt was agreed that exchanges in the Eastern part of thecountry would be brought up to target standard using atask force approach comprising staff members ofpressurisation teams and others where necessary.

3. Pressurisation Team

On completion of the implementation of centralisation

and centralised work management and the eliminationof pressurisation black-spots the pressurisation teamwill be right sized in accordance with span of controlagreements. The National Pressurisation Team willwork into the national Preventative Maintenanceorganisation.

4. Next Steps / Implementation

The SAPG agreed on the following next steps: Communications to key stakeholders. NOPG. NFMC, Pressurisation teams, SA Field Managers

and teams. Phase 1: Establish a project team of appropriate

subject matter experts to implement centralisedoperating model.

Phase 2: Establish task force for phase 2.

Resourcing for ServiceIn December of 2006 a four-page letter was receivedby the Union from eircoms Director of Operations. Theletter set out in some detail the then pressing customerservice issues. A report titled Before the Storm onthe contents of this correspondence was presented to

the SEC at its December meeting.

Before the StormOperations Director met informally with NationalOfficers Fri 1st December followed by note to G.S.and National Officers on the Service Issues.

Key Points Pressure from Customers and COMREG

regarding eircoms Service Performance. Backlogs in both Service Assurance /Service

Delivery.

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DSL Volumes are up 49% year on year. PSTN/ISDN demand up 13% year on year. Retail/Wholesale demand 26% ahead of

forecast. Fault volumes up 16% Eastern Areas and 11%

overall. Doing lots of work (good productivity) going

backwards. Pending Orders touching 19,000. Faults could reach 10,000 normally resourced to

clear approx. 1450 daily with Proactive Repairsupport.

Cannot allow service to continue to deteriorate,

particularly in high revenue areas where there ismost competition e.g. Cable Operators.

Proposed Next StepsEstablish Joint Group to agree detail of effectiveinitiatives and monitor implementation.

Initiatives could involve (both short term and longer

term).

Additional resourcing/ staffing in Service Assurance and Service Delivery in Eastern Areas.

Movement of staff between NE, S.A. and S.D.(Team Rebalancing)

TESL involvement in DSL jumpering Recruitment.

Following consideration of the above report andadditional information it was agreed to establish a JointGroup to deal with the issues arising. This group wastitled the Resourcing for Service Group.

Resourcing for Service -Partnership Agreement

1. IntroductionDue to increased demand for broadband our DSLvolumes are up by 69% year on year. The PSTN andISDN demand is also up by 13%, year on year. Overallthis year our retail and wholesale demand is up by26% based on previous forecasts. On repair our faultvolumes in the field are up by 16% in eastern areas.Furthermore we have not been able to resource ourpreventative maintenance programmes on the East

Coast due to the high levels of faults.In the context of the above there is an absoluteimperative on eircom to meet customer servicedemands. The Company and Union in partnership have

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h o l e s a l e N e t w o r k s

therefore explored and agreed how best these servicechallenges can be met.

Outlined below and in the attached appendices are thekey elements of the agreed measures for Quarter 4(Jan to March 07).

Mobilisation of existing Service Assurance,Service Delivery and Network Engineering staff tomeet required demand in Service Assurance andService Delivery.

DSL Jumpering initiative in Dublin to releasesuitability skilled technical staff for Service

Assurance field activities. External resource requirements.

2. Mobilisation of existing ServiceAssurance (SA), Service Delivery(SD) and Network Engineering(NE) staff to meet requireddemand in Service Assuranceand Service Delivery

This measure is designed to address deficits throughthe deployment of SA, SD and NE staff. Suitably skilledindividuals will be identified and assigned immediatelyto the local team where the deficit exists within 50miles.

In addition there may be scope to assign some RetailEnterprise unit staff.

Following the assignment of such adjacent resources,deficits will still exist, primarily in eastern-based teams.These deficits will be addressed by deployment onmobility (i.e. > 50 Miles) of resources from SD, SA andNE for Quarter 4. Mobility is a key feature of thisagreement and all teams in scope will be expected tomake the required contribution. Also as part of themobility process, local consultations will take placeprior to the deployment.

To facilitate this and as an exceptional measure, aproductivity incentive scheme will apply for SA, SD andNE staff in scope. This will apply for SA, SD and NEstaff mobilising greater than 50 Miles into Dublin onService Assurance. Details of this scheme are outlinedin Appendix 1.

3. DSL Jumpering initiative inDublin to release suitably skilledtechnical staff for ServiceAssurance field activities.

The primary driver for this DSL jumpering initiative is torelease suitably skilled staff for SA field activities. Thiswill be achieved by mobilising Retail Enterprise Unit

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(REU) staff where available to Dublin on DSL jumpering. To facilitate this and as an exceptionalmeasure a productivity incentive scheme will be put inplace for those REU staff mobilising greater than 50miles into Dublin. Details of this scheme are outlined in

Appendix 1. Where there is a resource gap followingthe implementation of this initiative, contractors can beused for DSL jumpering in certain exchanges. Theextent and location of such contractor activity will bediscussed locally. Allied to this, other initiatives may beconsidered during the quarter.

4. External resource requirements All internal Network Engineering available resourceswill be programmed based upon agreed priorities interms of skill sets. The contracting out of any resultingexcess work will be implemented as per existingagreements. The levels of spend will be reviewedquarterly in Partnership to monitor contractor activity.

Appendix 1 Enhance Mobility Options

1. REU

For REU staff moving to Dublin, the followingenhanced option will be available:

Mobile StaffDublin OnlyOperation DSL activi ty

(Mon 0830 -FridayclosingminusTravel Time)

QualityMeasures Success of provide

IndividualTargets

ProductivityBonus

80completetasks perweek, 1,040withinquarter

Bonus payment on DSLCompletes 1040 orgreater = 2,000, 988 to1039 = 1,500, 936 to987 = 1,000, 884 to 935= 500,


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Medicals for Rigging StaffThe Union received the note below which, followingconsideration was agreed.

Medical certification of fitness forrigging dutiesDue to the nature of rigging work, there is a strongburden of duty of care on the company in relation tothe safe working of these staff. It is essential thatriggers be medically fit to perform their duties safely.While riggers undergo an initial medical when they areappointed to these duties, the process is not repeatedat this time. In recognition of this duty of care, weintend to introduce ongoing medical certification forfitness for rigging duties.

The Safety, Health and Welfare at Work Act 2005makes provision for this requirement in Section 23.

Section 23 provides for:

An employer to require that an employee undergoassessment by a registered medical practitioner,

nominated by the employer. The employee to notify the employer in any case

where the assessment indicates that theemployee is unfit to perform the work activities.

If at any time the employee becomes aware thathe/she is suffering from any disease or physicalor mental impairment, which would impair his/herability to perform the work activities safely, thenhe she must notify the employer or the registeredmedical practitioner, who will in turn inform theemployer.

Best practice in industry is that rigging staff wouldattend every 2 years up to age 50 and annually for over50 year old. This is practised in BT. It is intended thatthis best practice, medical fitness certification cycle,be introduced immediately for all rigging staff in

eircom. Arrangements will be put in place to identify suitablemedical practitioners to carry out this certification andmake appointments for staff who have not had medicalcertification in the last two years.

The medical check is intended as a specific check onfitness for rigging duties and not a general medicalcheck up.

Head of Core Network BuildNetwork EngineeringNovember, 2006

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Business Support Restructuring

A report from the NOPG on Business Supportrestructuring was presented to the Union in early 2007.The report set out a number of proposed changes inthe support functions within Network Operations. Thereport further recommended a process, to be known asthe Network Operations Enterprise Unit, through whichthe ensuing redeployment issues might be addressed.

Network Operations Enterprise unit A key element in the restructuring of Business Support

functions involves finding solutions for the staff who will be displaced through the restructuring process. It is proposed to establish a dedicated unit within theStrategy & Change organisational unit in Network Operations to manage this transitional process.

Based on experience and existing models, thefollowing principles have been developed and will be

adopted by the unit: -

It is recognised that for change to proceed successfully the implications for staff re-deployment, must be assessed as a top priority

and therefore, alternative options for individuals must be identified.

Re-deployment is an on-going process. To support re-deployment, a number of enablers

are required:

Training and Development Mobility across organisational boundaries Flexibility

It is important to stress that the unit should be viewed as a process rather than a physical place and that the number of staff assigned to the unit will be a function of the ability of the unit to absorb them. In this regard it is

the objective of the unit to ensure where practical thateach member of staff will prior to assignment to theunit be designated either their new redeployment roleor a specific project role.

This unit will initially consist of staff displaced from theBusiness Support restructuring. People assigned tothis unit will be available for project work or re-

assignment to alternative positions that may become available within Network Operations or across theeircom Group.

This unit will have a line management structure and will

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have a separate cost centre. The role of manager of theunit is to: -

Ensure resources are optimised to meet the needs of the business.

Support people through change. Facilitate the identification of realistic career options and life choices.

Foster ongoing personal development with a viewto optimise resource opportunities.

Encourage mobility across work disciplines Manage stakeholder relationships.

Celerant Engagement

In early 2007 the Union considered a Companyproposal to engage with the Celerant ReviewExtension. Celerant was (is) a U.K. based consultancywith expertise in the telecommunications industry.They had been engaged by eircom to undertake, interalia, a comprehensive analysis and review of allaspects of the field and centre activities within theService Delivery and Service Assurance organisations.

After some internal debate the Union agreed to furtherengagement with the Celerant Review and theoutcome of this review was labelled Project Clear.(Further details on Project Clear are outlined elsewherein the Conference Report)

Utility VehicleRestructuring/Centralised PolingDiscussions on the above proposal began during 2006at a Sub Group of the Operations National PartnershipGroup. Following a series of meetings the documentbelow was agreed with the Union in Spring 2007. Itwas also recognised that issues would arise that wouldneed to be dealt with during the implementation phaseof the agreement.

Update on UV CentralisedPoling Fleet/Utility Fleet

restructureThe issue of the UV Centralised Poling Fleet Model hasbeen under discussion at the Network OperationsPartnership Group (NOPG) up to last December. Youwill be aware that since December the focus of thepartnership process has been to address the CustomerService crisis and that a joint Company/ partnershipgroup was formed to explore and agree measures toaddress these service pressures.

It is now timely to revisit the UV Centralised Polingmodel issue with view to implementing the proposaland thus free up resources in a efficient way to addressthe customer service pressures.

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UV Centralised Poling modelTo recap, the Utility Truck is a heavy and expensivevehicle typically equipped with auger, crane and winchand is capable of towing heavy cable carriers. It is aflexible and useful vehicle, used to stand poles anderect cable. There are approx. 117 vehicles acrossService Delivery, Service Assurance and NetworkEngineering, usually one per team.

There are a number of business factors, which requirea restructuring of the Utility Fleet operations, whichinclude:

Age of fleet requires considerable immediate

investment to continue with current operationalmodel.

High vehicle replacement cost at approx.80,000 yielding an immediate investment of6m required to replace aged fleet.

Poor utilisation with current average 2 2 polesstood per week per vehicle and 34 vehicles usingzero fuel during June.

High vehicle running costs with high maintenanceof hydraulic elements which deteriorate with age.

High level of second vehicles amongst UV crews,with UV used typically 2-3 days per week.

Only 10% - 20% of UVs used every day.

UVs used for functions which cheaper and lightervehicles could be used (winch capability, heavycable towing).

Vehicles often off the road due to non-drivingcrew.

In summary, the UV fleet is poorly utilised and thecurrent operational model too expensive and requiretoo much immediate capital investment to continue.

Following discussions, the main aspects of theproposal are as follows:

A centralised UV Poling fleet will be establishedconsisting of 30 UV vehicles and 60 staff (2 perCrew/UV) managed by 1 SOM and 4 CTMs.

The UV Fleet will be headquartered at thelocations listed in the table 1.

TEAM AEH

CTM 1CastlebarDonegalLetterkennyRathedmondTuam

CTM 2Dundalk

AthloneDublin NorthDublin South

Continued. . .

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Table 1The Selection criteria will, if necessary, follow a 2-stageprocess:

Stage 1 Staff within S.A and S.D. currently engaged on

regular UV duties will be asked to apply for thenew dedicated fleet.

Each member of the UV crew must be trained onthe Operation of the UV.

Each member of the UV crew must hold acurrent/valid Category EC driving licence.

Staff will be selected based on Skill set and

experience as per Skills/Experience questionnaireand in line with the needs of the Business.

Where all the above are satisfied selection will becarried out based on Seniority.

In the event of the Stage 1 process yielding insufficientstaff in relevant locations, the selection arrangementswill be extended under stage 2 to appropriate staff

within Network Engineering currently engaged on U.V.duties.

It must be stressed that the establishment of aCentralised Poling Fleet constitutes a key initiative withrespect to, among other things, contractor substitution.Therefore the new dedicated poling fleet will berequired to be resourced from Service

Assurance/Service Delivery staff and/ or Network

Engineering staff currently engaged on UV duties asper Stage 1 and 2 above. It is expected therefore thatan assignment process will not be required providedthe staged process delivers the necessary staff.

TEAM AEHContinued . . .

CTM 2CavanDroghedaLongfordMullingar

CTM 3

Arklow

DungravanWaterfordNaasNew RossPortlaoiseThurlesTipperary Town

CTM 4BantryCaherciveenBandonKillarney

MallowNewcastlewestTemplehillTraleeEnnis

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RedeploymentCentralising the UV Poling Fleet will result in the needto create some redeployment opportunities. In thecontext of renewed emphasis on Network Renewal ithas been agreed that the proposal outlined belowrepresents the best way forward in most cases.

1. Proceed with the implementation of the NationalUV organisation as agreed.

2. Redeploy the resulting circa 50 displaced staff tothe interim Proactive Repair Field Forceorganisation to deliver, within their relevant areas,the required programmes which include:

Chronic DPs. Network Sealing. Lightening protection. J Hook replacement.

Staff redeploying to Proactive Repair will be providedwith all appropriate resources including training andequipment.

After the circulation of the agreement on U.VRestructuring a communications process waslaunched to update all staff in scope. However thestage 1 and 2 process did not get the required

numbers and the following letter issued from HeadOffice in Summer 2007.

Colleagues,

Attached is a copy of the Agreement on U.V.as previously circulated. Please be aware that having gonethrough the selection stages in the Agreement a

significant number of areas do not have the required numbers to staff the Utility Vehicles. (The areas inquestion are in red on page 2 of the attachment.)

Can I urge you all, especially in the light of the most

recent National proposals, to encourage eligible staff inthe areas in question to urgently reconsider applyingfor these vacancies. The Company have made it clear to the Union that they will move to an assignment

process, in accordance with the Agreement, if they do not get the required numbers.

Regards.

Notwithstanding the above correspondence, of the 60staff required to operate the U.V Fleet just 34 appliedand the remaining staff were assigned. Finally the UV.Fleet was up and running in autumn of 2007.

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Relocation of CustomerComplaints Function

IntroductionThe agreement on Business Support Restructuring setout the arrangements for a customer complaint unitwithin Network Operations as follows:

A centralised customer complaints unit, located in onecentre, under the management of this centre while

servicing the needs of all the Functional Business Areaswithin Network Operations. This unit will consist of a

number of full time customer complaint resolvers located in Cabra.

This agreement has not yet been implemented as itwas considered prudent to continue with the businessas usual arrangements in the Business until the volumeof complaints became more manageable and therewas further clarity on the strategy for centres.

The turnaround on resolving complaints is significantlyoff the target of 80% resolved within 10 days, andrequires the constant scrutiny of the resolvers toprogress updates and closure of complaints.

Revised proposalThere is a requirement therefore to move to the singlecustomer complaint model immediately to address thiscustomer service issue. Following a review of theoriginal decision to locate the unit in Cabra it has been

decided to propose relocating the function to theGalway FSC with a staffing of one manager and 5 staffon complaint handling. This will deliver the requiredfocus and efficiency to allow us reach our statedtargets on complaint handling. The work that this teamcurrently handles would be distributed across the other4 Field Support Centres (Dundalk, Ennis, Waterfordand Killarney).

The staff in Cabra currently on customer complaintswill be re-assigned to PCC duties.

Why Galway FSC?Galway is the preferred candidate centre for thiscentralisation opportunity for the following reasons:

The current FSC in Galway which is located in theadministration building, has 5 COTs plus 1 CTM,currently carrying out the Field Support functionfor the old West Region (Galway and Sligo areas).

This is right sized for the requirements to deliveron our complaint handling targets.

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With the reorganisation of the field organisationsthere is no longer a need for regional specificfocused centres.

The centre in Galway is of such a small size thatits viability as a FSC is in question.

With the roll out of the blackberry units to fieldstaff and the reduction expected in call volumesspace will be created ac

Documents

NEC eComms Report 2008