MONTREAL - Globalive will keep 800 employees hired for its new cellphone service with some of them doing paid volunteer work, while waiting to see if it gets federal approval to launch its wireless business, the company said Wednesday.
The CRTC prevented Globalive from launching its Wind Mobile phone service this month, ruling the company isn't Canadian-owned and controlled.
About 400 of Globalive's cellphone retail store and call centre employees in Calgary and Toronto have finished training and are volunteering at organizations such as food banks, boys and girls groups, literacy groups and the Salvation Army, said Chris Robbins, chief commercial officer at Globalive Wireless.
Robbins said Globalive hopes there's a quick resolution so its cellphone employees can get to work, but there's no specific time line.
"We're talking weeks, not quarters or years, for sure," he said of keeping them on the payroll. "Obviously to let 800 people go is a massive, massive business decision."
He said it doesn't make sense to let the employees go and then face the prospects of rehiring and retraining 800 people.
Robbins says others hired include technical, human resources, finance, sales and marketing and information technology employees. There were plans to hire another 200 in sales had Globalive been allowed to launch, he added.
Industry Minister Tony Clement is reviewing the Canadian Radio-television and Telecommunications Commission decision.
Globalive chairman Anthony Lacavera holds two-thirds of the voting shares and a roughly one-third equity stake in the company, while Egyptian telecom Orascom owns 65.1 per cent of Globalive's equity and one third of the voting shares.
However Orascom also holds much of the company's debt, a major sticking point for the CRTC.
Globalive had planned to launch this month in Calgary and Toronto and in the first-quarter of next year in Edmonton and Ottawa.
Analyst Carmi Levy said Globalive's announcement signals its optimism that it will ultimately succeed in satisfying the CRTC's Canadian ownership requirements.
"If Globalive was going to walk away from the table now, the last thing it would do is hold on to its employees," said Levy of Toronto's AR Communications Inc.
But if Globalive fails, it will have to let the employees go, he said.
"In that respect, the employees are the company's canary in a coal mine."
Global Telecoms Business website has reported that Orascom CEO Naguib Sawiris is still hoping a resolution will be found to allow Globalive to launch by the end of the year.
Globalive wants to be Canada's fourth major wireless carrier and compete nationally with Rogers (TSX:RCI.B), Bell (TSX:BCE) and Telus (TSX:T). It has spectrum across Canada, but not in Quebec.
Telus has sent a letter to Clement reiterating that Globalive's ownership structure doesn't meet Canada's foreign ownership restrictions.
"It would be wrong to allow one foreign controlled firm that did not play by the rules to drive the terms and timelines for such massive changes to our laws," said Michael Hennessy, senior vice-president of regulatory and government affairs at Telus.
Hennessy said Telus has never been opposed to foreign ownership restrictions being lifted, but all carriers must operate under the same rules.
Public Mobile CEO Alek Krstajic said if Globalive is unable to launch its business, he would be interesting in buying of it's put up for sale.
"We'd be very pleased to have that conversation," Krstajic said.
DAVE Wireless CEO Dave Dobbin said the CRTC decision should be upheld.
"There will still be competition," Dobbin said.