whats going on here?, page-7

CRAZY John's employees are likely to have a bleak Christmas, with up to 200 people facing redundancy after the holidays.

The news comes as staff last Friday marked the second anniversary of founder John Ilhan's passing.

On the same day they bid farewell to another of Mr Ilhan's long-time lieutenants, corporate sales manager George Midas.

As reported earlier this month, Crazy John's chief executive Brendan Fleiter plans to retire, to be replaced by chief financial officer Antony Sault.

After Christmas, about 150 jobs will be offshored to Mumbai, India, where the mobile phone retailer's parent, Vodafone Hutchinson Australia, operates a call centre. The restructuring would happen in the first half of next year, sources said.

The remaining Crazy John's staff to be made redundant next year would initially come from finance, credit management and customer relations, they said.

"Their tasks would be absorbed by VHA," sources said.

An air of uncertainty hung over Crazy John's and GRLmobile employees in Melbourne, they said. "VHA have not given them any answers on what's in store for the future."

Crazy John's unit and mobile virtual network operator GRLmobile, run by ex-Myer executive Michele Hamdorf, is a prepaid service aimed at the female youth market.

In August, company executives dismissed talk of GRLmobile's impending demise, describing it as pure rumours.

There were expansion plans afoot. Mr Fleiter had said GRLmobile's sales channels -- Australia Post, Kmart, Target, Dick Smith and Crazy John's -- would increase over the next few months.

Crazy John's employees fear that VHA's Sydney-centric management is intent on wiping the slate clean and consolidating its operations under one roof.

VHA has a 10-year lease on 11,000sqm of office space in North Sydney that can hold about 1000 full-time employees. The building will be completed by the middle of next year.

The first phase of the Vodafone-Hutchison marriage resulted in 320 staff cuts, split equally between the two wings of the merger.

Sources said benchmarking tests on "best practice" for integration was conducted with several local banks and the outcome was to keep Crazy John's running as a separate entity. "They're not following that advice at the moment," sources said.

A VHA spokesman declined to comment on possible retrenchments, saying "it's business as usual at Crazy John's".

In September, Mr Ilhan's wife Patricia sold her 75 per cent share in Crazy John's to Vodafone in a deal that valued the company at about $150m. Crazy John's had about 700 employees then and about 120 retail stores. The company has since been been reducing its workforce.

Crazy John's was founded in 1991 by Mr Ilhan, who at the age of 42 died suddenly while on a morning walk.

He attracted blue-chip investors National Australia Bank and Melbourne's Smorgon family despite a public legal stoush with Telstra after severing a 16-year relationship with the telco.