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Rockwell CEO takes a 25% pay cut, but plant workers get a bonus
Rockwell Automation has announced that it is cutting the salaries of its non-manufacturing employees temporarily by 7.5%, with chairman and CEO Blake Moret taking a 25% pay cut, and all senior vice-presidents losing 15% of their salaries, as part of the steps that the company is taking “to align its costs with anticipated market conditions in light of the Cpvid-19 pandemic”. However, Rockwell’s manufacturing workers will not be affected by the pay cuts and are, in fact, receiving one-off additional payments in recognition of their work in serving the company’s customers “during this difficult time”.
“Our first priority is the well-being of all our employees, and we are taking significant steps to keep our people healthy and safe at this time,” says Moret. “The Covid-19 pandemic has created unprecedented challenges, and I have never been prouder of the efforts of our employees and partners. Their dedication is helping to ensure that our customers in the life sciences, food and beverage, and personal care industries are able to deliver the products that are critical to so many people and companies around the world.
“Rockwell Automation operates from a strong financial position,” Moret adds. “While our fiscal second quarter sales held up well despite significant pressure from China in the quarter, we expect that as Covid-19 impacts more countries and economies, we will face lower demand in many of our served industries for a period of time.
“As a result, we are taking pre-emptive actions to align the company’s cost structure with this environment. We are doing so in a way that minimises workforce reductions and enables us to continue making strategic investments in technology and domain expertise that are important to Rockwell Automation’s success over the long-term.”
Rockwell currently anticipates that there will be no payouts for its incentive compensation plans during the 2020 financial year. The company is eliminating discretionary spending across the organisation, and is instituting other temporary cost actions that will take effect at most of its locations around the world by the beginning of May. The board of directors has reduced its cash fees by 50%.
The company’s matched funding is being suspended for US employees participating in its 401(k) retirement savings plan.
Rockwell says it plans to reverse these temporary actions “as soon as possible as markets recover”.
