Update June 18, 2020: After this story was posted, T-Mobile reached out to us with a statement about the layoffs. The company now says it is adding 5,000 jobs, fulfilling the pledge to add positions after the merger with Sprint.
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The communications industry is littered with broken promises about new jobs of late, and now T-Mobile is joining in with some layoffs of its own. The company is laying off hundreds of Sprint employees after the merger despite promising regulators that it would hire more workers if they allowed the merger to go through.
Q1 2020 hedge fund letters, conferences and more
The news about the layoffs at T-Mobile come the same week as AT&T announced layoffs of its own.
T-Mobile announces layoffs at Sprint
TechCrunch reports that on a series of conference calls on Monday, T-Mobile Vice President James Kirby informed hundreds of Sprint employees that they will lose their jobs. The tech blog obtained audio of one of the calls about the T-Mobile layoffs, which are affecting only Sprint employees. The job cuts come two months after the $26 billion Sprint-T-Mobile merger was completed.
On the call TechCrunch obtained audio for, Kirby said they were getting rid of Sprint's inside sales unit, which sells services to small businesses. He didn't say how many layoffs T-Mobile was doing. Nearly 400 people were on the conference call, and there were reportedly several similar calls throughout the day on Monday.
The Sprint employees who will lose their jobs will be laid off on Aug. 13. The WARN Act requires employers to provide two months' notice ahead of mass layoffs.
A source told TechCrunch that T-Mobile is doing layoffs in every division, but Sprint's inside sales unit seems to be the hardest-hit.
Promise to be "jobs-positive from Day One"
Interestingly, Kirby said the mass layoffs at T-Mobile will pave the way for the addition of 200 new jobs. He encouraged employees to apply for those positions during the conference calls. However, if the company is only adding 200 jobs and cutting hundreds more, it seems executives weren't entirely truthful with regulators about the merger with Sprint.
In a blog post in April 2019, then-CEO John Legere said T-Mobile's merger with Sprint would be "jobs-positive from Day One." He said their opponents were getting "REALLY creative in their claims." Specifically, he was talking about their claims about the impact the merger would have on jobs.
"This merger is all about creating new, high-quality, high-paying jobs, and the New T-Mobile will be jobs-positive from Day One and every day thereafter," he said. "That's not just a promise. That's not just a commitment. It's a fact."
After the news about the layoffs got out, it's going to be hard for T-Mobile to answer questions about this supposed fact that the merger will result in more jobs rather than fewer. While it's true that Legere isn't CEO anymore, it is telling that the company didn't wait to start laying off Sprint employees.
Opposition wasn't wrong about layoffs at T-Mobile
Legere made a big deal about how it was supposedly a fact that they would add jobs after the merger with Sprint. He claimed that people who said the merger would have a negative impact on jobs were trying to "mislead and scare people into thinking that their made-up 'numbers' about jobs at the New Y-Mobile are accurate."
He accused the opposition of pulling "numbers out of thin air to justify their claims."
"We also keep seeing the opposition try to use projected layoff numbers from an analyst's projections that were based on a completely different deal at a completely different point in time to discredit this merger."
He went on to describe the opposition's claims about layoffs as "offensive," although we now know that the opposition was correct about there being layoffs at T-Mobile following the Sprint merger.
He claimed that after the merger, T-Mobile would "invest nearly $40 billion in network and business expansion over the first three years alone." He claimed the company would "open five new, state-of-the-art New T-Mobile Customer Experience Centers" and expand its existing sites after the merger. Every new center was supposedly going to create about 1,000 jobs.
Legere also said they would be "bringing thousands of overseas jobs back to the United States" and "create nearly 5,600 new American customer care jobs by 2021." He also claimed that the combined company would "have more than 11,000 additional employees on our payroll by 2024 compared to what the combined standalone companies would have."
