Famous two-wheeler manufacturer TVS Motor Company send out a shocking news where it has decided to reduce the salaries of its employees after the steep fall in sales amid the COVID-19 pandemic.
This big announcement was made by company's chief executive officer KN Radhakrishnan, who communicated the decision to employees on May 23.
“The company has chosen to rollout a salary reduction across different levels for a period of six months, starting May 2020 to October 2020. We will review the situation depending on the business condition that exists then”, said the internal communication reviewed by CNBC-TV18.
Taking a look back at the month April, employees at TVS Motor Company were paid their full salaries then.
“In the wake of the unprecedented crisis, TVS Motor Company has rolled out a temporary salary reduction across different levels for a period of six months (May to Oct, 2020). There will be no salary reduction at the workmen level. However, there will be a 5 percent salary reduction at the junior executive level and about 15 to 20 percent at the senior management level. It was heartening to see employees coming forward and offering to take salary reduction voluntarily”, TVS Motor Company spokesperson told CNBC-TV18.
Ever since the coronavirus outbreak has taken place, an internal memo from the company stated that COVID-19 crisis has had a detrimental impact on business operations not just in the country but globally too.
“Many sectors have implemented stringent measures to overcome this crisis. This includes cost cutting, job reductions, and salary cuts. Therefore it is important that we take cognizance of the situation and react appropriately”, the letter further added.
Weeks back, Bajaj Auto, too announced a salary cut across levels but the company later deferred the decision.
The country's auto sector is facing a demand crisis as a result of the COVID-19 pandemic.
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