Job cuts are inevitable in Rogers’ $ 26 billion deal to acquire Shaw, critics say

Executives at Rogers Communications Inc. promise growth and investment in the West, but critics say the company’s $ 26 billion deal to acquire Shaw Communications Inc. will also bring job cuts that Rogers has privately counted on but of. who does not speak publicly.

At a Canadian Radio, Television and Telecommunications Commission hearing this week, Rogers reiterated his promise to spend $ 2.5 billion on 5G technology and $ 1 billion on rural internet in British Columbia, Alberta, Manitoba and Saskatchewan.

It also plans to “create up to 3,000 net new jobs” in those four provinces, in addition to building an engineering center and maintaining a central office in the west, all key to winning support for the deal in Shaw’s hometown of Calgary.

The merger of Canada’s second and fourth largest telecommunications companies will affect millions of consumers and will also bring together two major employers: Shaw has 9,400 workers, while Rogers has 24,000 employees, more than half in the GTA, which is home to its headquarters in downtown Toronto.

But academics, public interest groups, a major telecoms rival and one of Canada’s largest unions say that while Rogers touts his investment plans to the broadcast regulator on the public stage, he’s not talking about the inevitable job cuts that they will come with the merger of two large cable and wireless businesses with overlapping departments of just about everything.

Behind closed doors, Rogers is almost certainly telling the Competition Bureau how much money the combined company will save, including by cutting jobs, said Robin Shaban, a public policy researcher and co-founder of economic consultancy Vivic Research.

In a twist on Canadian competition law, the deal could hurt competition and be bad for wireless, home internet or TV customers, but it would still get the green light from the office if companies can prove that generates significant savings. That is bad news for workers, Shaban said.

“We have a law that allows mergers that hurts competitors if the merger results in sufficient job losses,” he said, referring to what is known as the “efficiency defense.”

Shaban said companies often cite job cuts as one of the main cost savings, or “synergies,” as Rogers calls the $ 1 billion it expects to save annually within two years of closing.

“You can’t have a billion dollar annual cost savings and not have job cuts,” he said.

“I don’t think there is any question that when you get a merger like this, companies are looking for efficiencies and that’s always a keyword for losing jobs,” said Gregory Taylor, professor of communication studies at the University of Calgary.

The CRTC is focused on the transfer of broadcast licenses, while the federal Innovation office and department are conducting parallel reviews of wireless license ownership and competition. It is also not expected to hold public hearings.

When asked if the bureau is considering how the deal will affect the workforce, spokesman Jayme Albert said the goal is to see if it will substantially decrease or avoid competition.

“While we understand that mergers can have an impact on employees, when determining whether a transaction will result in a substantial decrease or prevention of competition, we generally do not take into account the impact that a transaction may have on jobs or employment.” .

Unifor, which represents 26,000 telecommunications workers and 500 in the broadcasting and film sectors (as well as unionized workers at the Star), told the CRTC on Thursday that it is concerned about the loss of broadcast jobs after that Rogers told the regulator that he will end up with about $ 13 million annually. local news funding that Shaw provides to Global News and redirects it to its own station, Citytv.

Unifor said that could lead to the loss of more than 160 jobs based on estimates of $ 80,000 per job. (Global owner Corus Entertainment has indicated that it will turn to other sources of funding, which could hurt other independent broadcasters.)

The Public Interest Advocacy Center and the Forum for Research and Policy in Communications also told the CRTC that they expect to lose broadcast jobs with any new hires on the telecommunications side. PIAC said those could be temporary network installation jobs.

Rogers spokesman Andrew Garas said Thursday that about 60 percent of the 3,000 Western positions will be in Alberta and most of the rest will be in British Columbia, noting that “the jobs will span a variety of permanent roles.” He said that investments in infrastructure mean “equipment is needed to build it, maintain it and serve the customers who use it.”

“As we move through the integration process … we will continue to have a strong employee base in all markets in which we operate in Canada,” he said. “Together with Shaw, we will (be) a truly national company with local teams that can continue to serve local customers and businesses in the communities where we live and work.”

Garas did not say whether or not the job cuts would be part of the $ 1 billion in synergies, which he said would come from lower network costs and the elimination of “duplicative technology associated with greater scale.” The company also expects higher revenue as customers make more use of its faster networks.

Telus Corp warned the CRTC on Tuesday that the transaction would contribute to a “hollow out of the Western Canadian business community,” and said the large amount of debt Rogers is taking on to pay for the deal “will inevitably lead to job losses. working in western Canada. ”

The deal has “a particular impact on Calgary,” Taylor said. “The political class here will hesitate to speak out against the Shaw family, but this will mean the loss of another important corporate headquarters in a city that is already suffering.”

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