TELUS Marketing Services Divestiture Questions & Answers (General, Employee & Customer) 04/99 General Questions 1. What kinds of services does TMS currently offer? TELUS Marketing Services is a call centre service bureau providing a broad range of inbound, outbound market research and consulting services to the North American marketplace. 2. Why is TMS closing down? TMS has been under a detailed review in the past few months. Although operating performance at TMS has improved, it is not at the level it needs to be. With the merger and a growth strategy, it makes sense to redirect the resources and telemarketing expertise into the Alberta based core services of BCT.TELUS. 3. When will TMS be officially closed? There will be a phasing out period while we work to redirect employees and complete our obligations to existing customers plus assist customers in securing new suppliers. We anticipate this being completed by the end of May 1999. 4. What about the TMS business plan which was recently approved through the year 2001? An approved business plan is not a guarantee for continuance of operations. 5. TMS experienced healthy growth in its first 18 months of operation. What events have occurred that are directly related to the business closure? TMS work is approximately 50% internal to BCT.TELUS and 50% external (mostly U.S. based). In general, the last year has seen intense pressure on operating margins resulting in an industry shift in the call centre business. Furthermore, TMS had a higher cost structure and although it reduced last fall, it was not enough to mitigate against lower than anticipated revenue. 6. Why did TELUS get into the telemarketing services business in the first place? TMS was created in 1996 in support of TELUS' growth strategy to secure new sources of revenue and to capitalize on the US teleservices industry opportunities through TELUS' own telemarketing expertise. 7. Whose decision was it to close down TMS? The decision was made by the BCT.TELUS Executive Management Council and supported by the TMS Senior Management Team. 8. How long has TELUS known about the possible TMS integration? TMS operations have been under review for several months, but it has only been a recent decision to adopt this redirection strategy for exiting the business. 9. How much will it cost to integrate the TMS business? Costs of redirecting the TMS business is still being reviewed and analyzed. 10. What happens to The Advisory Group? The Advisory Group was purchased by TMS and remains part of TMS. Advisory Group employees will be provided with the same opportunities and options or redirection or transition as other TMS employees. 11. TMS just purchased TAG a year ago - couldn't TMS make money at this? TAG has been a positive addition, with revenue growth of 34%. However, while revenue goals were met, the line of business overall did not achieve a profitable position. 12. How much money did TMS lose in 1998? As you know, BCT.TELUS does not disclose specific operating details. However, TMS faced a difficult year financially in 1998 and did not meet its operating income targets for 1998. The pursuit of an aggressive growth plan combined with the status of the U.S. teleservices industry contributed to a less than positive financial picture. 13. Is this closure a result of the merger? The detailed review of TMS operations concluded that there should be a divestiture of the business and a refocusing of resources towards the core businesses in BCT.TELUS. TMS revenue represents one-half of one percent of TELUS' total revenue, and less than one-fifth of one percent of BCT.TELUS' forecast annual revenue. With the merger integration activities, it makes sense to refocus the non-core services of TMS toward the core business of BCT.TELUS and toward enhancing customer service efforts. 14. Can we expect to see some of the other BCT.TELUS lines of business also close down as a result of the merger? All non-core businesses are under examination as to how they fit into the future of BCT.TELUS. 15. Does BC TEL have an equivalent operating company to TMS? No. 16. Will TMS services be provided by any other areas within BCT.TELUS and if so, where? All options for redirection of TMS services into Alberta based operations are currently being reviewed. 17. Why were you unable to be competitive in this area, and what does that say about your overall competitiveness? The business of TMS was a step outside of non-core services. BCT.TELUS is very competitive in its core business and will use the knowledge it gained in TMS toward the core services of BCT.TELUS. TMS is being integrated in support of the focus on core products and services. Employee Related Questions 18. How many full time jobs will be cut? Although there is no guarantee that there will be positions for everybody, we are actively looking into all Alberta based areas of BCT.TELUS that have a need for the skills we can provide to meet the business demands of individual operational areas. We hope to redirect as many people as possible. 19. Are you eliminating all contract positions? There are no "contract" positions at TMS. The majority of TMS employees are "casual" employees whom are TELUS employees serving the variable requirements of TMS work. 20. What areas are people going to work in for BCT.TELUS? We are currently looking at redirecting as many employees as possible into the marketing, market research, telemarketing and customer services areas of Alberta based operations of BCT.TELUS. 21. If half the work is being done by TMS was TELUS work, does that mean you need half the people to integrate back into the company? Possibly. We are looking at a number of areas in BCT.TELUS where these skill sets can be utilized. 22. How many employees will be affected by the integration of TMS? Approximately 400 employees consisting of 350 "casual" employees serving the variable requirements of telemarketing work and the remainder being regular full time employees. 23. What options are available for TMS employees? In addition to redirection and transition options we are also examining opportunities to migrate a number of current work activities into other Alberta based areas of the company. Where similar work exists, appropriate resources will follow. 24. Is this the first wave of layoffs as a result of the merger? All positions within BCT.TELUS are currently under review as the newly merged company integrates and restructures itself to operate most efficiently and meet business goals and objectives. 25. Will my status change (i.e. from flex/term) to regular if/when I am successful in obtaining work in another area? The status of positions in other areas of the company will vary, however, TMS employees will be treated consistently with other employees in the new work area. 26. Will my salary change if/when I am successful in obtaining work in another area? Salaries and benefits vary depending on the work area and type of position. Employees who are redirected to another position will be treated consistently with the other employees in that work area. 27. What about the compensation plan review that the Sales teleprofessionals are currently part of? Will that activity continue? The compensation plan review will not be continued. 28. What will happen to the corporate positions that provide direct support to TMS such as HR, Finance and IS? These positions will be considered as part of the overall integration activity and assessment processes are currently underway within their respective home areas. 29. What kind of career opportunity support can I expect to receive from Human Resources? On site facilities will be established in Calgary for TMS employees to direct inquiries, receive information, and drop off resumes. Arrangements are also being made in Calgary for on-site skills testing and training for resume preparation and interview skills. Edmonton employees will have access to the same support through designated HR support provided by Steve Tchir. 30. How should I go about finding another opportunity within BCT.TELUS? Human Resources areas throughout TELUS will be apprised of potential candidates from TMS for all vacancies in their Alberta based areas. Current job postings will be reviewed to determine potential skill matches and where possible, arrangements made to accept applications from TMS employees. In addition, you will be expected to update your resume and apply for jobs that you see available for which you qualify. This will be a joint effort; TMS acting as a funnel, attempting to locate as many opportunities as possible, and your initiative. 31. If my current work concludes prior to my finding alternate work will I be paid my regular hours of work while I apply on positions? If you are a Flex or Term employee you will not continue to receive an income until such time as you commence employment elsewhere in TELUS or receive a letter of termination. If you are a regular part- time or regular full-time employee you will be declared to be in Transition and the policies and procedures applicable to Transition will come into effect. (Note: some of the previous policies and processes have changed) More details on the specifics of this process will be provided as soon as possible. 32. If I am a regular employee who is not interested in an alternate position within TELUS can I opt for Transition? Employees do not “elect” transition. Transition is an outcome of the organization being unable to offer you a position of equal value (pay band) within the TELUS organization within a reasonable period of time. (Note: some of the previous policies and processes have changed) 33. If I am successful at securing work in an alternate position within TELUS but my current work is not concluded will I be released to the new position? If I’m not released will the position be held for me until I am available? Every effort will be made to release employees to new positions within TELUS to meet the needs of that business. In the event that the employee is critical to a closure element a reasonable release will be negotiated. In the event that a reasonable release cannot be negotiated the employee will be released to the new position and TMS senior management will determine alternate arrangements. 34. How will I know what positions are available within TELUS? When and how do I start looking? The TELUS Careers will continue to be available to employees, as will the TELUS Intranet. Additionally, TELUS HR will alert employees to potential opportunities. 35. Will TMS employees be given preference over other candidates due to the circumstances at TMS? No. The candidate best suited to the position from those who apply will be awarded the position. Customer Related Questions 36. How long will TMS continue to operate on current customer contracts? TMS will continue to fulfill all current obligations. 37. How many clients does TMS have and how do you intend to migrate those clients to other suppliers? TMS has 20 external clients and will work closely with each of them to secure an appropriate future supplier. 38. If you are abandoning this aspect of the business, won't BCT.TELUS have to contract out (internal call centre needs) the work to another supplier? No, internal work that is currently being done by TMS will continue to be done through other areas within BCT.TELUS. 39. How will you inform customers? All customers will be contacted by a personal telephone call from a TMS senior manager and by a customer letter. 40. What other telemarketing companies can TELUS refer customers to? You can contact TMS VP Sales, Chris Beadle at (403) 207-2104 to discuss alternate suppliers and customer needs. ------------------------------------------------------ TMS Divestiture: Employee Communication Sessions Questions & Answers 1. Is this move proactive or reactive? Both. We are reacting to the financial pressures we’ve been facing and proactively making this decision because it makes timely sense. 2. Will the call centers remain active? It is likely that Bert Cyr’s group will operate the existing call center at 28 Street. The RGO site will remain open while there is work or until the facilities are leased by someone else, but in any event, will not be operated by TMS any later than June, 1999. 3. Is there still going to be market research? No, not as we know it today. 4. Are there any plans to merge staff between TELUS and BC TEL? Redirection opportunities are for Alberta - based operations only. 5. What does this mean for us today? Business as usual in respect to meeting client needs. 6. What if we fill the majority of jobs and there’s still 100 or so people left? Redirection of as many employees as possible, where there is a demonstrated business need, is the goal. Employees unsuccessful in obtaining work elsewhere in BCT.TELUS will be treated in accordance with BCT.TELUS policies and process. Additional information on the policies and processes that will apply will be made available to all employees as soon as possible. 7. If I’m on a test campaign, do we prepare a resume and wait? Will we still stay on the test? We will first determine the clients’ needs and proceed with the work on that basis. Regardless of the work you are performing today, all employees should start preparing their resumes and applying for jobs within TELUS that are appropriate to their skill set. 8. What about employees who are on vacation or absent? The senior management team will be contacting all employees who are on vacation or absent. 9. Who is our point of contact? Your managers and team leaders remain your key contacts. In addition, human resource advisors will be assigned to employee groups. 10. Will employees have access to computers to prepare resumes? Yes. 11. Are employees allowed to stay on site on their own time to prepare resumes? Yes. 12. Will all campaigns end in 90 days? No. There will be a phasing out process, the timing of which is dependant on client needs and our requirement to fulfill our obligations. Some campaigns will end sooner. Others may last the full 90 days. 13. Will the merged company still have a marketing services? TMS will cease to exist. This is a divestiture. The focus is to redirect activities where it makes sense to do so into Alberta based operations. 14. Will you be looking at all areas within BCT.TELUS, not just telemarketing? Yes. 15. What is the time frame? We estimate 60 to 90 days based on current client obligations. 16. When/how will we know when not to come to work? We will operate “business as usual “ until you are notified otherwise. Employee absenteeism will continue to be monitored and remains a factor in assessing candidate suitability for employment opportunities elsewhere in the company. 17. Is there a guarantee/contract with Optima? No. 18. Will prep work and training have to be done on employee’ own time? The company will support 3 hours of paid time directed towards accessing training and the other options we have provided on-site for staff. All other activity will be conducted on the employees ‘ personal time. 19. Will we continue to receive telephone concession until we no longer have a position? Yes. 20. Are salary reviews still frozen? Yes. ====================================================== SPECIAL BULLETIN March 8, 1999 The following press release was released March 8, 1999 BCT.TELUS to redirect TELUS Marketing Services’ resources into core business Calgary, March 8, 1999 – BCT.TELUS Communications Inc. is exiting the third party call center business previously carried out by TELUS Marketing Services (TMS) and will be redirecting as many resources as possible in Alberta based operations of BCT.TELUS’ core services. TELUS Marketing Services (TMS) offers a broad range of inbound, outbound, market research and consulting services to the North American marketplace. TMS’ revenue represents less than one-fifth of one percent of BCT.TELUS’ forecast annual revenue. Currently, half of the business TMS does is for Alberta based operations of BCT.TELUS. The other half is for external clients, largely U.S. based. All customer contracts will continue to be honored. BCT.TELUS has decided that as company-wide merger integration continues, employee expertise at TMS will be more valuable working within the company towards growth in the core services and enhanced customer service. TMS currently has 50 full-time and 350 casual employees. Management will work to find employees positions within BCT.TELUS Alberta based operations; one of many steps the company is taking to integrate the workforce, build efficiency and create a strong national communications company. BCT.TELUS Communications Inc. is Canada’s second largest telecommunications company. The BCT.TELUS group of companies provides a full range of advanced communications services and products connecting Canadians with the world. BCT.TELUS trades on the Toronto and Montreal stock exchanges (stock symbol BTS). -30- For further information, please contact: Jeff Welke, BCT.TELUS media relations (780) 498-7236 jeff.welke@telus.com Distribution Note: This special bulletin has been distributed to all employees with Intranet/Microsoft Exchange. If you know of someone who may need this information but does not have access to these systems, please print a copy for them.