Telecom Italia announced a redundancy plan that will see 170 managers, representing a quarter of its top executives, leave the company by the end of 2018.

The move is intended to reduce costs and ensure a “generational change” among top executives.

In a statement, Telecom Italia said it had struck an agreement with  Federmanager, the body that represents the managers, over the redundancies.

The cuts primarily affect those who have already made enough contributions to qualify for some of their pension, or will do so by the end of 2018. Alternatively, they are eligible for early retirement based on the country’s Fornero law, the 2012 legislation designed to shake up the jobs market.

The redundancies are also part of a process the company has started to reorganise and simplify its structures, with the redundancies laying foundations “for future initiatives to enhance and develop internal management resources”.

The plan will affect around a quarter of the Italian operator’s top managers, which consists of 648 executives, and the company said it will provide incentives to managers who have not yet reached a pensionable age, but accept redundancy voluntarily.

This includes a contribution of €20,000 to those managers who intend to start up a business, or to go freelance.