Several SL Blue chip firms announce pay cuts to manage Covid-19 hidden costs

Several SL Blue chip firms announce pay cuts to manage Covid-19 hidden costs

9 April 2020 09:01 pm

In sign of imminent private sector financial down turn triggered by Covid-19 crisis, several Sri Lankan blue chip companies are taking measures to mitigate the inevitable blow it will have on businesses.

Leaders from some of the companies most affected by the pandemic are forfeiting their paychecks as the pandemic worsens.

From the airline industry to hotels to business firms, CEOs have announced that they are willing to take partial or full pay cuts.

On April 2, SriLankan Airlines said in a statement that it has implemented cost saving measures to ensure survival of national carrier and livelihoods of employees, including the mandatory salary reductions from the staff starting from 2.5% to 25% for a period of three months.

Other measures include; freezing all the salary increments to be implemented in the year 2020, and temporarily terminating operations from 8th to 21st April, 2020 with the exception of cargo services which have a direct impact in saving costs.

Premier blue chip company John Keells Holdings (JKH) also announced a series of cost-cutting measures including pay cuts for Executives and freezing of new recruitment for three months to survive the impact of the ongoing COVID-19 pandemic crisis.

Issuing company internal memo John Keells Holdings chairman Krishan Balendra stated that directors will face a 60% salary cut, and other executives a 35% salary cut. While travel allowances (excluding the loan deduction component) will not be paid for the next three months.

Meanwhile, Sri Lanka’s biggest apparel exporter Brandix Lanka Ltd. (BLL) also divulged a number of cost-cutting moves, including pay cuts as high as 60% for executive cadre, and Board members foregoing compensation, as internal measures to manage the impact from COVID-19 pandemic.