'Outraged': Union lashes Telstra after 2800 job cuts amid AI push

The potential job cuts announced on May 21 amount to 2800 jobs, with most of the axed roles to go by the end of the year.

Telstra says the move will help save the company $350 million.

Chief executive Vicki Brady said the changes were needed to ensure Telstra could continue to invest in supporting the ever-increasing growth in data volumes on its networks.

"Some of the proposed measures, which require consultation with employees and unions, would result in up to 2800 job reductions from Telstra's direct workforce," she said in a statement.

"Telstra's ongoing investment in infrastructure, technology, innovation and service for our customers drives growth and underpins Australia's digital economy, contributing to the prosperity of the nation."

Community and Public Sector Union national secretary Melissa Donnelly told ACM the union was "outraged".

"This will have a real impact on the thousands of families who rely on these jobs and it'll have an impact on Telstra's customers," she said.

The job cuts come after the telco announced earlier this year it was accelerating its AI push, with "two in-house developed generative AI solutions" enabling "faster and more successful interactions with customers".

According to Telstra, trials during 2023 showed 90 per cent of employees using the tool saved time and increased effectiveness, resulting in 20 per cent less follow-up contact.

A Telstra spokesperson said the cuts did not have to do with the telco's AI push.

Treasurer Jim Chalmers labelled it a "very distressing day" for affected workers.

"We will be seeking advice from the ACCC [Australian Competition and Consumer Commission] about some of the claims that Telstra is making about their new pricing strategy and the role of the NBN," he said.

"From our point of view, we want to make sure - and the budget was part of this - that, as our economy changes, that we get better at adapting and adopting technology, that our people are the big beneficiaries of those changes in our economy and in our technology base as well."

Nationals leader David Littleproud said he was always "sceptical of Telstra and particularly for those that live in peri-urban areas and regional areas".

"When I've got towns that are without coverage, can't even use fax machines in businesses for two to three days, they have had a significant lack of investment in just getting the basics right," he said.

with AAP