Rodney Davis, former president of Cable and Wireless Jamaica, claims his former bosses have withheld half of his agreed compensation. - Winston Sill/Freelance Photographer
Rodney Davis, terminated last year as chief executive officer of Cable and Wireless Jamaica, has sued his former employers to recover £201,840 (J$28 million), or half of what he said was the agreed settlement when he was shown the door in August 2007.
In court documents Davis said C&W claimed to have withheld the cash because of alleged breaches of authority by him in contracts executed while he was boss of the Jamaican subsidiary of the UK-based telecoms firm.
Accusations rejected
Davis, who rejects the accusations in court papers as "disingenuous" could not be contacted for comment on the case filed on his behalf by the Kingston law firm Nunes Scholefield and DeLeon.
He did not return several telephone calls to his office - Davis now works with Joey Issa at Cool Corporations - but claims in court documents that the full amount due to him is £403,680 (J$56 million), which should have been paid in two instalments, subject to his full compliance with the terms of a signed agreement.
C&W declined to speak to the issue.
"Talking about a past employeee of Cable and Wireless, it is just totally inappropriate that I comment in any way," said Phil Green, who last August replaced Davis as the boss of C&W Jamaica and has been busy reversing most of the initiatives of his predecessor.
Revolving door
The company up to this week had filed no defence to the lawsuit.
The CEO's office at C&WJ's corporate headquarters on Half-Way Tree Road in St Andrew has been something of a revolving door for its occupants since the liberalisation of the Jamaican telecoms market at the start of the decade and the Irish upstart, the mobile phone company, Digicel, used the island to launch a big foray into the Caribbean and Central America. Relieved of its monopoly, Cableand Wireless lost market share and bosses in London opted for a conveyor line of CEOs in a desperate bid to grab back business and boost profitability.
Davis, a young, blunt and edgy personality who former colleagues say was given to convening early morning meetings and grilling his executives on operational details, was brought into the company in August 2005 with a mandate to change the fortunes of C&WJ.
He came with a two-year blueprint to return C&WJ to market dominance, and quickly began to shed managers and appeared set on a strategy of matching the brash, young, cool image that had been cultivated by Digicel.
He talked a lot about improving the customer experience of C&WJ's subscribers.
Among Davis' initiatives was the introduction of Homefone, a system that allowed fixed line customers, to opt for a pay-as-you go service, as well as the so-called 10/8 plan that effectively lowered rates on mobile services.
Cable and Wireless has not provided details on the performance of these initiatives, but critics suggest that while they may have had success in attracting customers they hurt the bottom line. For instance, many fixed line subscribers migrated to Homefone, but Cable and Wireless lost the monthly mandatory line rent that such customers used to pay.
Digicel's dominance
In the case of the 10/8 plan, analysts argue at the time of its implementation C&W already had cheaper mobile rates than its major competitors, Digicel.
Although the move might have bumped up Cable and Wireless' share of the mobile market, it did not cut into Digicel's dominance. The upshot: with most C&W's mobile calls terminating on Digicel's network, its bottom line began to erode.
For the financial year ending March 31, 2008 C&WJ reported a net loss of $4.2 billion, after a write-down of $5.1 billion on its mobile telephone network and the utilisation of $3 billion in tax credits to shore-up its bottom line.
Just one year before, the company had reported profit of $2 billion.
One of Davis' initiatives, sponsorship of the reggae festival, Reggae Sunsplash - at the time viewed by analysts as part of Davis' attempt to burnish C& WJ's image for cool — was among the items cited as cause by Davis' former bosses to withhold a portion of the former CEO's termination package.
Accent group
Phil Green, new president of Cable and Wireless Jamaica, said it would be inappropriate to comment.
They claim that he was personally involved.
Bernard Buckley, Cable and Wireless plc's group human resource director, according to Davis' court papers, also cited the outsourcing of the company's contact centre, to a group called Accent.
Buckley also claimed that "evidence of 'unsubstantial' journal entries has come to light through an investigation into the company's affairs during the time you were president and CEO", alleging that the transactions could not be substantiated.
"(There was also) evidence that you breached limits of authority adopted by the company or allowed those limits to be breached," Buckley said in his letter, according to Davis' court filings.
However, Davis, whose total termination agreement was for £403,680 sterling - to be paid in two instalments - said the concerns raised by Cable and Wireless only arose in Buckley's letter of March 28, three days before the outside date for the payment of the second tranche.
Contrived and disingenuous
Davis' court filings said the claims against him were "contrived and disingenuous and cannot support or form any basis for reliance on the said clause" of the termination agreement on which C&W relied for its action.
"... The reasons are based on sweeping allegations with only veiled suggestions by no specific allegations of wrongdoing on his part amounting to material breach as alleged or at all," Davis' lawyers said in their filing.
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