Telefonica reportedly proposed laying off 5,040 employees as part of a plan to reduce costs, according to two trade unions.

Reuters reported while discussions with unions UGT and CCOO are ongoing, with the proposed job cuts potentially impacting 41 per cent of the employees in the Telefonica de Espana unit, 31 per cent at Telefonica Moviles and 24 per cent at Telefonica Soluciones.

The news agency noted the layoffs represent a 20 per cent reduction of about 25,000 employees across the operator’s staff in Spain.

According to Reuters, UGT stated Telefonica also proposed a 32 per cent reduction at subscription TV service Movistar+.

Bloomberg added a representative for the UGT union stated Telefonica will hold additional meetings with three other subsidiaries.

Earlier in November, Telefonica revealed its five-year strategic plan under CEO Marc Murtra which includes cutting its dividend payouts next year to prioritise investment in core technology.