The Communications Workers Union (CWU), which represents most of the 3,500 technical staff in Eircom affected by yesterday's announcement, has reached agreement in principle with the company on the creation of "two or three" joint ventures to supply services to Eircom and, possibly, its competitors.

While declining to reveal the exact nature of these businesses, the union's general secretary, Mr Con Scanlon, said they would centre on Eircom's "access network" which links customers to telephone exchanges.

Meanwhile, the union is to explore the possibility of workers taking a further shareholding in the telecoms company.

Mr Scanlon said the employee share ownership plan (ESOP) agreed before the flotation of Telecom Eireann last year prevented workers taking more than their current 14.9 per cent stake in Eircom.

But he added that the possibility of changing this aspect of the agreement would be explored with Eircom's board. Some 35 per cent of the company is for sale following a decision by Dutch firm, KPN, to dispose of its 21 per cent stake in Eircom and Telia's decision to sell its 14 per cent holding in the firm.

About 800 workers included in yesterday's announcement were expected to leave Eircom under the terms of a previous early release and voluntary severance programme, which has already reduced Eircom's workforce by 1,700.