Financially stressed owing to the ongoing lockdown, Exide Industries has decided to impose a 15-30 per cent salary cut in the upper- and middle-management brackets.
According to a company communication reviewed by Business Standard, the company’s managing director and CEO, Gautam Chatterjee, has taken a 30 per cent pay cut while those at the director, president and vice-president levels will forego 25 per cent of their salary.
General managers and the deputies in this grade will suffer a 20 per cent reduction in salary, while senior managers will get 15 per cent less.
There will be no reduction in salary for all other grades.
The situation will be reviewed after the end of the first quarter ending on June 30.
Exide refused to comment on the development.
“The need of the hour today is to work on sharp reduction in our fixed costs. This calls for a little sacrifice from our employees as well. We will have to take a 15-30 per cent pay cut at selected upper levels in order to deal with this unprecedented crisis,” a communication signed by Chatterjee said.
The company reasoned that although its business performed “fairly well” till February, March has been a “wash-out”. The current market condition, Exide said, is very weak and cash flows have been affected as customers are not clearing their dues. Besides, the liquidity condition in the market has tightened, prompting the company to take this step.
While Exide has maintained itself as a debt-free company, the current situation has forced it to resort to banks loan to honour commitments made to employees and other stakeholders.
The company said it will try its best to protect managerial jobs in times of the ongoing crisis.
On March 23, Exide had stated that to contain the spread of Covid-19 and comply with various Central and state government orders, the manufacturing facilities and other offices have been shut temporarily till further notice.
Sources said Exide has decided to operationalise its logistics centres which distribute batteries. It will take a call on plant operations on a case-by-case basis.