Hewlett Packard Workers asked to take 10% pay cut

greenspun.com : LUSENET : Grassroots Information Coordination Center (GICC) : One Thread

Workers asked to take 10% pay cut THOUSANDS of workers at one of the world's biggest IT companies have been given until Friday to agree to a 10% pay cut. In an attempt to save more than £70m, Hewlett Packard has asked its employees around the world to sign up to the cost-cutting scheme.

All the computer giant's 3,700 UK staff have been asked to consider the voluntary pay cut by the end of this week.

Meanwhile, Carly Fiorina, the firm's chief executive, is earning a reported £50m over three years. US-based Ms Fiorina was named The Most Powerful Woman in Business by Fortune magazine last year. She has a personal bodyguard and has used a Gulfstream IV executive jet to visit the company's various offices around the world.

Hewlett Packard, the world's second biggest computer maker, blamed the pay cut demand on a slowdown hitting the industry worldwide. A spokesman said: 'The IT spending slowdown that began in the United States in December 2000 affecting the industry as a whole continues to spread globally. As a result, HP is taking additional long and short-term actions to ensure we become more cost competitive while working to increase revenue. '

More than a quarter of the company's international workforce of 90,000 have already agreed to the pay cuts. The scheme is targeted at employees across the board - from part-time staff and those on the factory floor, through to management.

Staff in the UK, including 1,300 at the company's research and design centre in Bristol, have been asked to take the pay cut from the beginning of this month to October 31. In a separate move, about 70 people are to be made redundant.

A 30-day consultation period is due to start next week and workers to be laid off will be selected on the basis of performance and whether their skills are needed to take the business forward. Only three months ago, the technology group - which manufactures everything from inkjet cartridges to £1m computers - warned of tumbling sales and said it was laying off 3,000 staff globally.

The spokesman added: 'Despite an increasingly gruelling business environment that could last for some time, we remain confident our strategy is the right one. We believe we will emerge from this downturn better focused to deliver our customers the solutions that they need to compete in this challenging environment.'

Employment law specialist Kieron Hill said the decision to seek voluntary pay cuts was 'unusual'. He said: 'There's nothing illegal about it if it's voluntary, but it is unusual for people to take pay cuts, especially in an industry where there are also skills shortages. I've never heard of it on this scale before.'

He added that he could not see how the financial benefits of a four-month pay cut would have much impact.

http://www.thisislondon.co.uk/dynamic/news/business_story.html?in_review_id=409282&in_review_text_id=358057

-- Martin Thompson (mthom1927@aol.com), July 05, 2001


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