Telecom's directors turned up to the company's annual meeting expecting to face the heat over chief executive Paul Reynolds' pay but it was outside the building where they received the biggest grilling.

More than 150 lines engineers picketed the Ellerslie Convention Centre to protest at the company's decision to switch to a new contract with Australian company Visionstream.

Sporting placards saying "Enough dirty tricks, greedy Telecom" and backed by a giant blow-up rat, the protesters called for Telecom to fix problems caused by the change, which has seen engineers lose salaried jobs and forced to start their own business as contractors under Visionstream.

EPMU national secretary Andrew Little said yesterday marked the official changeover of the Auckland Northland contract to Visionstream.

He claimed the company had failed to successfully make the transition in time because it had not been able to recruit enough staff and there were over 1000 faults in Northland.

"People have been without phones for weeks because of Visionstream's failure to offer decent wages employment to lines engineers. It's time for Telecom to listen."

Inside the meeting Reynolds said he recognised change was unsettling but he believed the company had made the right choice. He said the new model directly aligned the pay and reward of skilled technicians with great customer service.

"That's what has been proven time and again in Australia, where Visionstream lead the market for customer service."

But he apologised to the company's Northland customers.