France Telecom-Orange commits to the French “generation contract” plan with the signature of a new agreement on senior personnel

Paris, Friday, January 11, 2013

On December 31, 2012, France Telecom-Orange signed a new agreement concerning the employment of staff approaching retirement age and on measures to develop the second half of their careers with French labour organizations CFDT, FO, CGC and CGT, representing 73% of the votes during the most recent elections of employee representatives and more than 80% as a proportion of representative labour organizations.

The seniors’ agreement, signed for a three-year period from 2013 to 2015, will apply to all personnel in France, regardless of their employment status, in all Group companies in which France Telecom SA holds at least 50% of the capital, directly or indirectly.
Despite the difficult economic conditions that have led to a drop in the Group’s business and profit margins, the agreement reaffirms the priority France Telecom-Orange has given to preserving job security for its employees, supporting the employment of senior staff and providing efficient career support.
The Group, in which one third of its employees in France will retire by 2020, is bringing together all of the components of the future “generation contract”, a legislation package currently being prepared by the French government. For the Group in France, this translates into a plan to recruit 4,000 permanent employees over three years, for the most part made up of young people. In addition, the Group has made a commitment to host 5,000 young people on work/study placements, a skills transmission system and an agreement aimed at preserving employment for senior personnel.
Stéphane Richard, Chairman and CEO of France Telecom-Orange, said: “With this agreement, and as demonstrated in the results of the latest social barometer survey, France Telecom-Orange is well prepared to meet the challenges it faces”.

the new seniors’ agreement focuses on five main fields:

  • career wind-down and transition between work and retirement

As a counterpart to a slight decrease of their wage, personnel aged 55 or more can enter a part-time plan to wind down their working hours over the period before retirement. The agreement allows senior employee to work 50% or 60% of their hours, for period 3 or 5 years, with 65% or 75% of their salaries. In line with the Group’s philanthropy strategy, it also includes a specific plan to allow eligible employees to volunteer within associations or NGOs that are Orange Foundation partners.
The Group estimates that up to 10,000 employees will subscribe to this new program, which is expected to represent a total cost of around EUR 1,400 million, of which EUR 1,100 million will be booked in 2012. A restated EBITDA figure will be disclosed during the presentation of the Group’s full year financial results to account for this extra cost. The remaining sum of around EUR 300 million will be booked between 2013 and 2019 based on the residual length of employment of staff within the program until their retirement.

  • anticipating career development

The Group commits to holding 12,000 “career orientation” interviews for personnel aged 55 and over for the three-year period of the agreement.

  • knowledge and skills transmission and increased tutoring

France Telecom-Orange will set up a new program to transmit knowledge and skills. The Group will also continue its efforts to develop tutoring and formally recognizing the role of tutors; it has made a commitment to providing 2,000 trained apprenticeship leaders or tutors during the term of the agreement.

  • improving working conditions

France Telecom-Orange will ensure that its employees have a suitable work environment so that they may conduct their work in the best possible conditions. It will also facilitate the possibility of telecommuting for employees aged 55 and above.

  • development of skills and qualifications; access to training

The Group is taking specific steps to ensure that personnel aged 45 and above have access to training, in particular by encouraging them to take advantage of their legal right to individual training (DIF).
This new seniors’ agreement is part of the France Telecom-Orange social contract that has been progressively implemented since September 2010, restoring a positive working environment.
The results of France Telecom-Orange’s 6th Social Barometer survey, which was carried out during the second half of 2012, once again confirm the improved working environment in the company, particularly with regards to the understanding and clarity of its strategy. Overall, perceptions of the quality of the working environment compared with that of other companies have noticeably improved:

  • 54% believe that the quality of the working environment is better than that of other companies (compared with 49% in June 2012 and 28% in October 2010)
  • 90% think it is better or identical (compared with 87% in June 2012 and 79% in October 2010)
  • The percentage of employees who think it is worse (3% compared with 4% in June 2012) has been divided by more than four since October 2010 (16%)

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About Orange

Orange is one of the world’s leading telecommunications operators with sales of 43.5 billion euros in 2012 and has 166,000 employees worldwide at 30 September 2013, including 102,000 employees in France. Present in 32 countries, the Group has a total customer base of more than 232 million customers at 30 September 2013, including 175 million mobile customers and 15 million fixed broadband customers worldwide. Orange is also a leading provider of global IT and telecommunication services to multinational companies, under the brand Orange Business Services.

Orange is listed on the NYSE Euronext Paris (symbol ORA) and on the New York Stock Exchange (symbol ORAN).
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Orange and any other Orange product or service names included in this material are trade marks of Orange Brand Services Limited.

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