Nortel Networks, the Canadian telecoms giant, has refused to rule out job cuts at its plants in Ireland after it announced plans to make a further 10,000 employees redundant worldwide.
The Canadian group, which employs 1,000 people in the Republic and more than 2,700 people in Northern Ireland, rocked financial markets yesterday when it warned of increases in losses and additional job cuts.
Nortel expected a net second-quarter loss of $19.2 billion (€22.2 billion) arising from charges incurred in restructuring the company.
The latest redundancy programme comes just weeks after the telecoms group announced plans to lay off 20,000 people. A spokesman for Nortel said the group had not yet identified where the new job cuts would take place but the latest move means Nortel will have reduced one-third of its workforce by the autumn.
"We hope the restructuring programme will be completed by the end of September and when we identify the businesses that will be affected we will begin an open and honest consultation process with employees," the spokesman said.
He said the company had not entered into any consultation process with any regions to date and that no breakdown was available on geographical locations affected by the latest restructuring. Mr George Matchett, from the GMB Union in Belfast, said union representatives had obvious concerns about the latest job redundancy programme. Ninety people were made redundant in Northern Ireland in the last round of job cuts while 40 jobs were lost in Galway earlier in the year.
"Nortel has not contacted the union about this latest development so we would hope this means that Northern Ireland will escape further job losses. The group has increased its workforce in Northern Ireland by 25 per cent over the last year but we will just have to wait and see whether we will be affected by this latest decision," Mr Matchett said.
Nortel Networks is one of the largest manufacturers of telecommunications equipment in the world. Its state of the art facility in Monkstown on the outskirts of Belfast focuses primarily on systems integration and research and development for the group's optical internet business.
The vast majority of the group's employees in the Republic, 900, work at its research and development centre in Galway while a further 100 work in Shannon and Dublin.
Mr John Roth, president of Nortel, blamed a downturn in equipment purchases and the impact of restructuring charges for the increase in net losses in the second quarter. "Led by the United States, the global telecoms industry is undergoing a significant adjustment," Mr Roth said.
"Nortel Networks expects to take a restructuring charge of approximately $830 million during the second quarter associated with the completion of the reduction of 20,000 positions and the closure of certain facilities," Mr Roth added.
He said the company was unable to predict how it would perform in the third quarter because the market was still very uncertain.
